AbstractsBusiness Management & Administration

Internal auditors are playing a vital role in the corporate governance structure of an increasing number of organisations and are a fundamental component of the combined assurance task force. The objective of this study is to analyse the relevance and value of the written assessment regarding the effectiveness of internal financial controls in a combined assurance environment within the financial services industry from the chief audit executive’s (CAE) perspective. Survey research was selected as an inquiry strategy. The survey research that was conducted, was in the form of questionnaires. The financial service companies that appeared on the 2012 Top 200 African Listed Companies were utilized as the population of this research study. Based on the outcome of the results of the research study, the relevance and value of the written assessment regarding the effectiveness of internal financial controls should be customised for and by every organisation. The most important aspect, firstly, is that the significant financial risks relating to material misstatement of the organisation’s financial position are identified. Secondly, that the internal audit activity performs a formal assessment on the effectiveness of the internal financial controls relating to the above mentioned risks, in the form of a written report. The results of this research study endorse the fact that the King III Report on Corporate Governance emphasises the role of internal audit in combined assurance and corporate governance. It was further noted that internal audit is perceived by the CAEs within the financial services industry as one of the most important role players within an organisation’s combined assurance processes. The written assessment of the effectiveness of internal financial controls is seen as the result and/ or final outcome based on Principle 7.3.6 of the King III Report (Institute of Directors Southern Africa, 2009:45). If all the associated stakeholders and/ or assurance providers offer valuable and constructive feedback on how to assess, manage and mitigate the significant internal financial control risks facing the organisation, it has the potential to result in increasingly sound corporate governance for the organisation.