Internal audit practitioners’ perspectives on corporate governance compliance at Namibian Regional Councils

Abstract

Internal audit practices improve the quality and importance of the management system, thereby increasing the efficiency and efficiency of the organization. The evaluation of internal auditing is self-motivated, particularly in increasing attention to the contribution of Corporate Governance. This study evaluated internal audit practitioners’ perspectives on corporate governance compliance at Namibian Regional Councils. The study used mixed methods of data collection. The population of the study were internal auditors from the eight Regional Councils of Harpdap, Omaheke, Otjozondjupa, Erongo, Kavango east, Zambezi, Oshikoto and Khomas Regional Councils, and the Ministry Urban and Rural Development. Convenience sampling technique was used to select twenty-four internal audit practitioners in selected Regional Councils, while purposive sampling was used to select eight officials from the Ministry of Urban and Rural Development. Quantitative data was collected through questionnaires and qualitative data was collected through interview guide. SPSS V.21 analyzed quantitative data and results were presented in tables and figures for easy interpretation. Content analysis was used to analyze qualitative data. In-depth interviews and questionnaires were related to the research objectives. Ethical principles were adhered to by obtaining approval letters, informed consent, principle of fair treatment, anonymity and autonomy, confidentiality and privacy, good faith and non-maliciousness, and principles of justice. Results showed that Corporate Governance principles, good leadership in internal audit practitioners, commitment of corporate discipline, independence of internal audit practitioners, corporate insurance, timely and accurate disclosure of financial performance, effective internal audit functions were complying with relevant laws and effective internal control systems were effective. However, the decision-making process was poor; internal auditors did not have any authority related to the activities they were auditing. Ineffective communication, limited balance of power and authority, poor management of Regional Councils, absences of audit and risk committee, as well as an insufficient number of staff made compliance of internal auditing ineffective. The Namibia Regional Council’s internal audit practitioners have a negative impact on compliance with Corporate Governance principles because the internal audit department of RC is small compared to the amount of work involved. This issue may not result into corporate assurance, timely disclosure and accurate disclosure of performances of financial positions. The reasonable conclusion of the study is that most of the Regional Councils in Namibia have not clearly followed the corporate governance principles of internal audit practitioners and cannot be effectively implemented. There was a serious mismatch between the principles of corporate governance in the structural arrangements of important institutional capabilities that support performance work. The study puts forward some recommendations that the compliance of internal audit practitioners in the Namibia Regional Council must exercise good leadership and integrity in judgment when guiding them to comply with corporate governance principles. In order for the Namibia Regional Councils to create value for their growth, it is necessary to improve timely information disclosure mainly in financial aspects. Poor disclosure of internal audit information can breed corruption and undermine accountability. The Government of Namibia should prioritize the implementation of the proposed incentivized performance monitoring and evaluation system for all RCs (CRO, Internal Auditors and audit committee), as this will ensure accountability, encourage hard work and competitiveness among RCs while also rewarding hardworking.