Impact of Board of Directors on the Internal Auditing Compliance with the Standards in Gulf Countries

DOI: 10.5176/2251-1997_AF16.49

Authors: Abdulaziz Alzeban

Abstract:

This study provides empirical evidence of the differences in the degree of internal audit compliance with the International Standards for the Professional Practice of Internal Auditing (ISPPIA) in five Gulf Countries, and examines the association between the characteristics of the board of directors, and internal audit compliance with the ISPPIA. The data set, coming from annual reports and a total of 113 usable questionnaire responses completed by Chief Internal Auditors in listed companies within those countries, indicated that no significant country differences were evident in their internal audit compliance with the ISPPIA. At the same time, it was found that ISPPIA compliance by internal audit departments was influenced by board characteristics (size, and independence). In bringing a Middle Eastern perspective to the existing literature on the adoption of the ISPPIA, the paper provides a welcome insight into the quality of Gulf companies’ corporate governance.

Keywords: Internal Audit, ISPPIA, Board of Directors, Gulf Counrties