TITLE:
An Assessment of the Effectiveness of the Internal Audit on the Performance of the Public Sector: Case Study of the National Revenue Authority (NRA)
AUTHORS:
Abu Kai Kamara
KEYWORDS:
National Revenue Authority (NRA), Effectiveness, Internal Audit (IA), Performance, Automated System for Customs Data (ASYCUDA, Audit Service Sierra Leone (ASSL)-Office of the Auditor General, Supreme Audit Institutions (SAIs)
JOURNAL NAME:
Open Access Library Journal,
Vol.10 No.8,
August
25,
2023
ABSTRACT: Effective IA involves evaluating the organization’s internal control system and risk management practices to improve its effectiveness. Internal auditors evaluating the organization’s internal control system and risk management practices improve the organization’s internal control system and risk management practices and are essential for effective IA. By providing independent assessments and recommendations in these areas, IA contributes to enhancing the organization’s overall governance and ensuring the achievement of its objectives while minimizing risks. In addition, activities related to evaluating compliance with laws and regulations and supporting fraud prevention are critical components of effective IA. By ensuring compliance and supporting fraud prevention, IA helps the organization maintain its integrity, ethical standards, and legal obligations while minimizing the risk of financial loss and reputational damage. Furthermore, the activities related to improving the organization’s operations and performance are also essential for effective IA. By identifying operational inefficiencies and providing recommendations for improvement, IA helps the organization achieve greater operational effectiveness. Additionally, by evaluating performance management systems and providing insights for improvement, IA contributes to enhancing the organization’s overall performance and strategic outcomes. Moreover, by providing recommendations, IA helps management and key stakeholders make informed decisions to enhance the organization’s performance, reduce risks, and ensure compliance with relevant requirements. Although this research contributes to the existent literature on the effectiveness of the internal audit on the performance of the public sector, however, the research findings are not generalizable but limited to NRA although good practices can be adopted from this research. The research finding reveals that NRA maintained an effective Internal Audit Department that has competent staff members and is resourced by Management in the midst of limited resources that contribute significantly to improving an organization’s risk management, internal control, and governance processes. It provides independent and objective assurance, adds value, and supports the audit committee, senior management, and external auditors in fulfilling their respective roles. However, the IA is faced with challenges that serve as a limitation to audits: With the modernization of revenue collection using automated software programs like Automated System for Customs Data (ASYCUDA) World, Electronic Cash Register, and Integrated Tax Administrative System, the audit department should be equipped with automated audit tools or technology to enable the Internal Audit and Controls to deliver on its assurance mandate and proffer appropriate recommendations that will add value and strengthen public confidence. The asymmetry of information and timely provision of information sometimes challenges the delivery of internal audits and also the challenge faced by the internal audit department has been the failure of most departments to respond to audit reports after long waiting times.