Determinants of Internal Audit Function Effectiveness and its Implication on Financial Reporting Quality

Effective internal audit function can support management to produce qualified financial reporting. The purpose of this study is to examine the influence of competency and objectivity of internal auditor toward internal audit function effectiveness and its implication on financial reporting quality. Survey was conducted on 87 companies listed in Indonesia Stock Exchange and analyzed using path analysis. The empirical results indicate that competency and objectivity of internal auditor have a positive and significant effect on internal audit function effectiveness and financial reporting quality. Furthermore, internal audit function effectiveness is significantly related to financial reporting quality