An Investigation Of The Impacts Of Internal Audit Departments in Small To Medium Firms (Case Study Of First Pack Marketing

Abstract

This study investigates the impacts of internal audit departments in small to medium-sized enterprises (SMEs), with a focus on First Pack Marketing. Given the global concerns about corporate governance and accountability, internal audits in SMEs have become increasingly significant. This research was grounded in agency theory and employed a mixed-methods approach, utilizing questionnaires and interviews to gather data from internal audit personnel, audited departments, and executive directors within First Pack Marketing. The findings reveal that while First Pack Marketing has established internal audit policies and procedures, there are challenges in their implementation, primarily due to inadequacies in personnel competence and budget constraints. The study also highlights a significant correlation between the effectiveness and efficiency of internal audit functions and factors such as clearly defined roles and policies, audit quality, and the independence and objectivity of auditors. The research concludes that robust internal audit functions, characterized by skilled personnel, clear policies, and independence, are crucial for enhancing audit effectiveness in SMEs. Recommendations include regular policy reviews, enhanced training for auditors, and strategies to safeguard auditor independence. This study contributes to the understanding of internal audit functions in SMEs and offers practical recommendations for enhancing their effectiveness.