We examine whether internal auditing provides value to organizations by reducing risk. We compare the changes in risks between audited business units and matched non-audited units within the same company. This design allows us to isolate the importance of an internal audit while holding constant...

We understand relatively little about factors that affect the internal audit function's ability to serve as an important monitor of financial reporting quality. We therefore study how turnover of the chief audit executive (CAE) influences financial reporting quality and stakeholders'...

We examine whether firms with managers that have prior internal audit experience are less likely to manage earnings. We find that firms with managers that have internal audit experience are associated with less overall earnings management, driven by lower real earnings management. Importantly,...

Prior academic and practitioner literature argues that the ethical tone at the top of an organization is a key factor in establishing an effective internal control environment. Drawing on self-concept maintenance theory and in-group bias theory, we predict that entry-level staff auditors will...

While the internal audit function (IAF) plays a critical role in organizations, it faces challenges in finding sufficient numbers of high-quality job applicants to fill its ranks. We examine experienced external auditors' perceptions of internal auditing and how their perceptions may influence...

This paper examines factors affecting non-accounting business professionals' willingness to work in internal auditing. In a 2 x 6 experiment with 502 participants from across the country, we find that, in contrast to prior research examining accountants, business professionals have relatively...

Auditors increasingly employ technologies to improve audit quality. Using a design science approach, we examine whether using drones and automated counting software can improve audit quality and thereby improve financial reporting. We assess three dimensions of audit quality—efficiency,...

This paper examines factors that influence job applicants' willingness to apply for positions in internal auditing. We predict and find evidence that job applicants are dissuaded from applying for internal audit positions. In two separate experiments involving participants at seven universities,...

International and U.S. accounting and auditing standard setters have focused considerable attention and rule making around group audits and in particular the reporting quality of subsidiary entities. We examine how membership in a consolidated group and the related group audit affects the...

The internal audit function's (IAF) regular interaction with management and continual presence within the organization place it in a unique position to monitor the organization. Although the IAF has significant potential to evaluate and improve corporate governance, research has yet to explore...