Accounting skills, auditor independence, and internal audit effectiveness: Evidence from a provincial inspectorate in Indonesia

Weak internal control and recurring audit findings in Indonesian local governments raise questions about how effective internal audit is in the public sector. Drawing on agency theory and stewardship theory, this study examines the effect of internal auditors’ accounting skills and independence on internal audit effectiveness at the Regional Inspectorate of North Sulawesi Province. An explanatory quantitative design was applied, using a questionnaire on a four-point Likert scale distributed to all internal auditors of the Government Internal Supervisory Apparatus (total sampling); 63 usable responses were analyzed with multiple linear regression. The results show that accounting skills and independence each have a positive and significant effect on internal audit effectiveness, and that both variables jointly have a significant effect. Independence is the stronger predictor, and the model explains a substantial share of the variation in audit effectiveness. This study contributes by isolating accounting skills, rather than general auditor competence, and by providing evidence from a provincial inspectorate, where research remains scarce. The findings imply that the Inspectorate should strengthen accounting-specific competency development and protect auditors from intervention. The results should be read with caution because the data come from a single institution, rely on respondents’ perceptions, and exclude auditors who did not respond.