The Role of Internal Auditors in Local Authorities in Malaysia
Good governance is precondition for competitiveness of a firm, market and economy. As part of the government machineries, Local Authorities also should observe and maintain good governance as they are entrusted with public money.Overseas literature has shown the importance of internal auditing in management of local authorities. Additionally, local internal auditing literature also revealed the importance of internal auditing as important governance structure in organisation. With respect to internal audit function, Treasury circular 2/79 requires all government department including Local authorities in Malaysia to establish internal audit department. The function and responsibility of internal auditors in government department are specified in that circular. This study will provide empirical evidence on the existence and scope of internal auditing in local authorities in Malaysia.The same variable used in the study done by Zakaria and Selvaraj(2002) are tested on internal auditors in Local Authorities in Malaysia. Sample of this study consists of head of Internal Auditor in Local Authorities of Southern State in Peninsular Malaysia. Given the importance of internal auditing in every type of organisation, it is hoped that this study will benefit the institutions and its stakeholders in their effort towards establishing and maintaining good governance.
Keywords: Internal Auditing, Local Authorities
Lecturer, Department of Accounting, International Islamic University
Lecturer, Department of Accounting, University Malaya