Exploring organizational drivers of internal audit effectiveness: insights from an emerging market

This study examines the key factors influencing the effectiveness of internal audit functions in businesses operating in emerging markets, with a particular focus on Vietnam. We employ multiple theoretical frameworks and employ a quantitative research method based on a sample of non-financial listed firms in Vietnam. In addition, we assess the effectiveness of internal audit in three key aspects: adding value to the business, increasing stakeholder awareness of the internal audit function, and enhancing stakeholder satisfaction with internal audit. The results from surveys indicate that the effectiveness of the internal audit function is significantly impacted by several factors, including the characteristics of internal auditors (capabilities, independence, and objectivity), support from senior management, the presence of an audit committee, and the legal system. The findings from this study have significant contributions and implications for the literature and practice. Our study contributes to the literature by presenting various measures of internal audit effectiveness and suggesting several potential factors that influence the effectiveness of the internal audit function in an emerging economy. The findings from this paper are also helpful for practitioners and policymakers in designing suitable regulations, guidelines and practices for the internal audit function to enhance its effectiveness.