Serving Two Masters: Does CEO Openness Moderate the Relationship Between Audit Committee Support and Internal Auditors’ Effectiveness? Ugandan Evidence

Abstract

Purpose – This study investigates the effect of the interaction between board audit committee support and chief executive officers’ (CEOs’) openness to internal auditors’ ideas on internal auditors’ effectiveness

Design/methodology/approach – This explanatory study, based on the positivistic paradigm, surveyed 128 internal auditors of formal financial institutions in Uganda and analysed the data using partial least squares structural equation modelling (PLS-SEM).

Findings – The results suggest that CEO openness enhances the positive relationship between board audit committee support and internal auditors’ effectiveness.

Research limitations/implications – A supportive board audit committee is necessary but not sufficient for internal auditors' effectiveness, and CEO openness enhances the board audit committee's support-internal audit effectiveness relationship. This study illuminates the view that internal auditors’ effectiveness can be significantly enhanced by leveraging CEO openness and simultaneously calling for audit committee support for internal auditors.

Originality/value – This study contributes to answering the research question of how internal auditors serving two masters, the board’s audit committee and the CEO, affect internal auditors’ effectiveness.