Internal audit and ethics: the case of the South African Social Security Agency.

Abstract

The Institute of Internal Auditors requires internal auditors to comply with its stipulations on inter alia, ethics in the profession of internal auditing and the code of ethics for internal auditors. In this context, the study on which this article reports, considered among other things the importance of promoting ethics in the profession of internal auditing, as well as the role of the internal audit function in enhancing internal controls. The research design and methodology for the study was qualitative. Data was collected using the case study approach, wherein on the one hand, one-on-one interviews with senior managers were conducted and on the other, open-ended questionnaires were completed by junior managers. This article1 suggests that, if all the necessary conditions under which an internal audit function can promote ethics in the profession, are not in place, the function itself also fails in improving ethical conduct/behaviour. In particular, the outcome of the research points to the importance of compliance with laws and regulations that govern the implementation of an internal audit function. The research findings indicate that compliance with rules and regulations by internal audit functions is one of the critical conditions that must be met for an internal audit function to contribute to the promotion of ethics in that profession as well as the enhancement of internal controls.