CHAPTER FIVE DISCUSSION OF THE RESULTS 5

CHAPTER FIVE
DISCUSSION OF THE RESULTS
5.0 Introduction
This chapter presents discussion of the results of the study on how the components of code of ethics for internal auditors influence the effectiveness of internal audit function in the public sector.
5.1 Discussion
5.1.1 Gender distribution of respondents
The study findings shown by Figure 3 revealed that 58% of the respondents were male while 42% respondents were female. These findings appeared to have significant proportion in terms of gender and avoided gender bias information due to the fact that women nowadays are increasingly employed in the public sector, in the same way as men. This is supported by the study conducted by Nzalayaimisi (2013) who found that, due the presence of rights and equal access of women in employment in Tanzania, many women have been employed in the in public sector. Thus, it was possible to get sufficient information from both genders on the influence of code of ethics for internal auditors on the effectiveness of internal audit function in the public sector.
5.1.2 Integrity of internal auditors

The findings of the study shown in table 4.12 reveal that, the coefficient of integrity of internal auditors was 0.175 and the p-value was 0.037. This means that, there was a positive relationship between the integrity of internal auditors and the effectiveness of internal audit function. Similarly, integrity of internal auditors has got important contribution to the prediction of the effectiveness of internal audit function because it has a p-value less than 5% which was statistically significant for the study. Thus, integrity of internal auditors was very important determinant of the effectiveness of internal audit function in which the public sector entities should give more emphasis in their internal audit function.
Also, the study findings shown by table 4.6 reveal that, all individual variables that constituent the integrity of internal auditors have greater mean as compared to the overall mean. This implies that, internal auditors hold integrity which is very essential for effectiveness of the internal audit function in the ministry because they performed audit activities in a professional way, honestly and they observed institutional laws, standards, policies and procedures in place.
The study findings were similar with the results of the study conducted by Leung and Cooper (2009) who found that, internal auditors need to uphold integrity as they inherit a position of trust and objectivity in their actions. They need to be sensitive to recognize ethical matters during their audits, analyzing them and advising their managements accordingly. By doing so, they will be able to improve their internal audit functions in their organizations.
Likewise, Coderre (2009) found that, internal auditors need to maintain a high level of integrity because it will create trust and thus provide a basis for the reliability of their assessment within and outside their organizations which eventually improves the effectiveness of their internal audit functions. Similarly, Njoroge (2016) found that, integrity of internal auditors is very important ingredient to the effectiveness of internal audit function in the public sector because they ensure ensuring effective utilization of public resources. Equally, the study conducted by Bailey (2010) found that, in public organizations with internal auditors who are upholding code of ethics for internal auditors, there is a positive correlation between the effectiveness of internal audit function and the overall organization’s performance.
5.1.3 Objectivity of internal auditors

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The study results shown by table 4.12 reveal that, the coefficient of objectivity of internal auditors was 0.186 and the p-value was 0.022. This means that, there was a positive relationship between the objectivity of internal auditors and the effectiveness of internal audit function.
Similarly, objectivity of internal auditors has got imperative contribution to the prediction of the effectiveness of internal audit function because it has a p-value less than 5% which was statistically significant for the study. So, objectivity of internal auditors was very vital determinant of the effectiveness of internal audit function in which it should be given more emphasis by the public sector entities.
Correspondingly, the study findings shown by table 4.7 reveal that, majority of variables that constituent the objectivity of internal auditors have greater mean as compared to the overall mean. This implies that, internal auditors hold objectivity which is very essential for effectiveness of the internal audit function in the ministry. This is because internal auditors were avoiding any relationship that may be in conflict with the interests of the ministry and they contributed to the legitimate and ethical objectives of the ministry.
The study findings were similar with the results of study conducted by Suwaidan and Qasim (2010) who found that, the objectivity of internal auditors contributes most to the confidence and effectiveness of the internal audit function. This is because internal auditors are not participating in any activity or relationship that could damage to the fair assessment of their organization operations.
Equally, the study by Prawitt et al., (2012) found that, effectiveness of internal audit function is influenced by the level of objectivity hold by internal auditors. By being objective, internal auditors are not supposed to accept anything that might harm or believed to be hurting their professional opinion.
Also internal auditors are supposed to disclose all material facts which, if not disclosed, could impair their objectivity which will in turn affect the effectiveness of internal audit function. They are supposed to be objective in order to improve the effectiveness of internal audit function in the public sector (Njoroge, 2016).
5.1.4 Confidentiality of internal auditors

Table 4.12 shows that, the coefficient of confidentiality of internal auditors was 0.073 and its p-value was 0.334. It means that, there was a positive relationship between the confidentiality of internal auditors and the effectiveness of internal audit function in the public sector. Besides this, even if their relationship was positive, confidentiality of internal auditors has not significant contributed to the prediction of the effectiveness of internal audit function because its p-value was greater than 5%. Thus, confidentiality was not an important determinant of the effectiveness of internal audit function in which the public sector entities should give more emphasis in their internal audit function. The findings were similar to the results of the study conducted by Pallant (2010) who found that, the variable with the level of significance beyond 5% is not making a significance contribution for the prediction of the dependent variable.
However, table 4.8 shows that, internal auditors were very careful in the use and protection of data that were available when performing the audits. Also, they were not using any information for their personal gain which means that, they hold the information acquired during the audits confidential. The study findings were in line with the results of the study by Rahahle (2017) who found that internal auditors need to uphold information confidential when performing their audit tasks which eventually influence effectiveness of internal audit function in their organizations.
5.1.5 Competence of internal auditors

The study findings as shown by table 4.12 reveal that the coefficient of competence of internal auditors was 0.234 and its p-value was 0.037. It means that there was a positive relationship between the competence of internal auditors and the effectiveness of internal audit function in the public sector.
Also, competence of internal auditors has a reasonable contribution to the prediction of the effectiveness of internal audit function because its p-value was less than 5%. Thus, competence of internal auditors was very important determinant of the effectiveness of internal audit function in which the public sector entities should give more emphasis in their internal audit function.
The findings were similar to the results of the study conducted by Arena and Azzone (2009) who found that, internal auditors need to be competent at all time in order to discharge their duties effectively so as to improve their internal audit departments.
Correspondingly, the study findings shown by table 4.9 reveal that, all variables that constituent the objectivity of internal auditors have greater mean as compared to the overall mean. This implies that, internal auditors were very competent which is very important for the effectiveness of the internal audit function in the ministry. This is because internal auditors were allowed to attend professional certifications and other continuing professional development trainings by management of the ministry in order to improve their skills.
Majority of the respondents indicated that, internal auditors possessed appropriate education in accounting, finance and auditing that allowed them to audit all operations of the ministry efficiently. The results were in line with the findings of the study conducted by Reghunandan (2005) who found that, knowledge in accounting, finance and auditing is very important attribute in the performance of internal auditors and also used as a means for evaluating the effectiveness of internal audit function.
Also, during interview with one internal auditor at the Ministry on the kind of supports that internal auditors need from the management in order to help them to comply with the code of ethics for internal auditors and eventually improves the effectiveness of internal audit function, he said that, “internal auditors need to attend professional trainings and seminars particularly related to Code of ethics for internal auditors apart from attending other trainings allied to other matters such as risk management and internal controls review”.
This finding of the study was similar with the result of the study conducted by Cohen and Sayag (2010) who found that, internal auditors need to participate in professional trainings related to their fields and complete continuing professional courses. By doing so, they will be able to demonstrate up-to-date knowledge so as to improve their competencies which eventually improve the effectiveness of the internal audit function in their respective organizations.
Moreover, the study findings were in line with the study conducted by Hailemariam (2014) who found that, competency of internal auditors is one of the critical characteristics of the effectiveness of internal audit function in the public sector. This is in line with the IIA’s standard 1210, on proficiency of the auditor which requires internal auditors to possess the knowledge, skill and other competencies necessary for performing audit activities efficiently.
5.1.5 Regression analysis

Table 4.10 shows a model summary of regression analysis between four independent variables which were integrity, objectivity, confidentiality and competence of internal auditors and dependent variable which was effectiveness of internal audit function in the public sector. The value of R was 0.873; the value of R square was 0.762 and the value of adjusted R square was 0.739.
The findings from table 4.10 shows that, 76.20% of changes in the effectiveness of internal audit function were attributed to the four independent variables in the study. Positivity and significance of all values of R shows that, the model summary was significant and therefore gave the logical support to the study model.
The four independent variables that were studied explain 76.20% of the effectiveness of the internal audit function in the ministry as represented by the R square. This means that, the four independent variables contributed about 76.20% on the effectiveness of internal audit function at the ministry while other factors not studied in this research contribute to 23.8% of the effectiveness of internal audit function at the ministry.
The regression model of the study as presented in the chapter three was Y = ?1X1+ ?2X2 + ?3X3+ ?4X4 + ?, where by Y was effectiveness of internal audit function in the public sector, X1 was integrity of internal auditors, X2 was objectivity of internal auditors, X3 was confidentiality of internal auditors, X4 was competence of internal auditors, ?1, ?2, ?3 and ?4 stand for correlation coefficients and ? was an error term.
Based on the regression analysis shown in Table 4.12, the model became as Y = 0.175X1 + 0.186X2 + 0.073X3 + 0.234X4 + 2.455. This means that, if all factors (integrity, objectivity, confidentiality and competence of internal auditors) were held constant, effectiveness of internal audit function would be 2.455.
Also, for every unit increase in integrity of internal auditors, the effectiveness of internal audit function would increase by 0.175. Likewise, a unit increase in objectivity of internal auditors would lead to an increase in effectiveness of internal audit function by 0.186.
Similarly, for every unit increase in confidentiality of internal auditors, the effectiveness of internal audit function would increase by 0.073 while a unit increase in competence of internal auditors would lead to an increase in effectiveness of internal audit function by 0.234.
The study findings show that, the variables of the code of ethics for internal auditors issued by the global institute of internal auditors influenced the effectiveness of the internal audit function in the public sector. Majority of the respondents indicated that internal auditors had been providing appropriate facts, fair and unbiased audit recommendations.
During interview with one respondent at the Ministry of agriculture on the level of satisfaction with the audit recommendations provided by internal auditors, she said that, “internal auditors provide useful audit recommendations which help to improve the internal controls of the ministry”.
Also, respondents indicated that, internal auditors respected the value and ownership of information and hold information confidential by not disclosing information illegal or prudent use of information for their personal gains.
The findings of study as explained above were similar with the findings of the study conducted by Ljubisavljevi? and Jovanovi (2011) who found that, internal audit function provides reliable, objective and neutral service to their users in order to enhance the effectiveness of the internal audit function.