Abstract:
Internal auditing has progressively gained prominence as a corporate governance
mechanism. There are some important differences between internal audit practices
in the private sector and their counterparts in the public sector, but changes in
the public sector have arguably reduced these differences, especially with regard
to governance. This study compares specific dimensions of a public and a private
sector internal audit function as a component of a more comprehensive corporate
governance mechanism, in the context of public sector reforms, including the
adoption of governance and management frameworks originating in the private
sector. The study is based on primary and secondary data, drawing on the views of
similar stakeholders. The findings of the study support the view that even though
internal audit functions in South African national departments are perceived to be
valid corporate governance mechanisms, they are not yet as well established as those
of the listed companies in South Africa selected for this study. The elements where
the internal audit functions of the public sector were found to be lacking highlight
areas where improvements are needed to achieve a well-established internal audit
function as an effective public sector corporate governance mechanism.
