Evaluation of risk-based audit factors affecting performance of internal audit in the public sector, a case of South-Rfft Region, Kenya.

Abstract

Intemal Audit departments that have adopted Risk Based Audit (RBA) have been envisaged as key in achieving proper management of financial and non-financial resources in public sector. Nevertheless, not much is known on how Risk Based Audit factors have contributed towards the performance of Internal Audit departments. This study sought to evaluate Risk Based Audit factors affecting performance of internal audit departments in public sector. The specific objectives were to detennine: the extent in which the listed RBA factors have been applied in Intemal Audit in public sector, the level of perfonnance achieved by Intemal Audit in public sector and the effects of RBA factors on perfonnance of internal audit in public sector. The study adopted cross-sectional survey research design to achieve the objectives. The study employed a census of all the 36 district Intemal Audit units in central government and 20 internal audits in local authorities in South Rift, Rift Valley province. Primary data was collected from the study respondents using structured questionnaires administered by the researcher. Data was analyzed with the help of the Statistical Package for Social Sciences (SPSS) computer software. Descriptive statistics such as mean, median, mode and percentages were used to analyze and present the data. Correlation analysis was used to analyze the relationship of variables. Results from data analysis support the following key findings; RBA factors has been moderately applied in internal audit in public sector within South Rift region; the overall internal audit performance in terms of Timeliness, Cost, and auditee demands was generally high, the RBA factors are positively correlated to and significantly influenced internal audit performance; and external factors such as the Government Regulations and Professional Standards had some influence on intemal audit performance in public sector. This study recommended the need to strengthen particular aspects of RBA in the internal audit in public sector; effective application of RBA‘ factors in order to achieve measurable improvement in the internal audit performance and address the influence of external factors such as the Govemment regulations and Professional Standards on performance of intemal audit in public sector.