Boris Tušek

The importance of the supportive control environment for internal audit effectiveness – the case of Croatian companies

Abstract The paper investigates whether a supportive control environment is associated with the internal audit effectiveness and what characteristics of a control environment are important in this respect. A survey was conducted via a questionnaire on 54 mostly large companies in Croatia. Appropriate methods of statistical analysis were used in order to analyse the survey results. According to the research results, in the case of a supportive control environment there is a greater chance that the internal audit will be effective and that its recommendations will be taken into account to a greater extent. In addition, the survey results showed a statistically significant correlation between perceived internal audit effectiveness and a higher level of supportive control environment.

The influence of the audit committee on the internal audit operations in the system of corporate governance – evidence from Croatia

The activities of the internal audit and audit committee in a company are of exceptional importance for the good practice of corporate governance. For the audit committee, performing numerous roles and responsibilities of are not possible without the appropriate interactions with the internal audit department. On the other hand, the quality of the internal audit operations in a company is largely determined by the cooperation with the audit committee. This research analyses the influence of the audit committee on the internal audit operations in the sense of achieving the numerous roles and tasks of modern internal auditing in the system of corporate governance. On the basis of the conducted empirical research, using a questionnaire, the following hypothesis was tested: the efficiency of the internal audit function increases through its inclusion in the activities of the audit committee. Before the analysis and discussion on the results of the conducted empirical research on the influence of the audit committee on the improvement of internal audit activity, obtained by using methods of analysis and synthesis, induction, deduction and comparative method, some relevant aspects are researched regarding the relation between the internal audit function and the audit committee in the system of corporate governance.