An evaluation of the staff functions of internal auditing

Abstract

Internal auditing is a staff function common to all organizations. Institutional research is a staff function unique to institutions of higher education. Both functions are internal to the organization, conduct appraisals of the organization, and collect data about the activities of the organization as a service to management. The study found that 77.6 percent of the available professional staff time in the surveyed university internal audit departments was devoted to accomplishing the Scope of Work standards. In institutional research offices this percentage was 32.1 percent, and in the private corporation internal audit departments it was 79.7 percent.

The purpose of this dissertation was to evaluate the independent appraisal function (internal auditing) in universities, and compare this function in universities with the same function in similar sized private business enterprises. A questionnaire survey procedure was used to: (1) evaluate the internal audit function in universities based on the Scope of Work standards as adopted in the Standards for the Professional Practice of Internal Auditing (SPPIA) in 1978, (2) consider all independent staff functions in universities that could be performing these Scope of Work standards, and (3) gather data for statistical comparisons of the proportion of total resources devoted to the Scope of Work standards in universities and in private business enterprises.

Statistical tests of the proportion of total resources devoted to accomplishing the Scope of Work standards in the two test groups were conducted. Resources used in the tests were number of employees and operating expenditures devoted to the Scope of Work standards. The null hypothesis (proportion of resources devoted to the SPPIA Scope of Work standard are equal) was accepted at the three levels of significance tested.

Other data were collected from the respondents in each test group. In almost all cases this supplemental data reinforced the results of the tests of the primary hypotheses. That is, the internal auditing function in the surveyed universities is very similar to the internal auditing function in the surveyed private corporations.