Corporate ethical climate and effectiveness of internal audit activities of firms
Keywords:
corporate ethical climate, internal audit activities, descriptive-correlation study, Philippines, managerial accountingAbstract
This research evaluated the relationship between the corporate ethical climate and the effectiveness of internal audit activities within cooperatives and corporations in Digos City, Philippines. Specifically, the study aimed to identify the dimensions of corporate ethical climate that most significantly impact internal audit effectiveness. A standardized questionnaire was distributed to 150 board members from various cooperatives and corporations. The research showed an overarching high level of corporate ethical climate across various indicators, with the exception of self-interest, which was rated slightly lower. In parallel, the effectiveness of internal audit activities was also ranked as very high. Analysis via Pearson product-moment correlation indicated a significant association between ethical climate and audit effectiveness. Stepwise regression analysis further pinpointed personal interest and organizational interest as key predictors of audit activity effectiveness, suggesting that higher ethical standards within these domains correlate with more effective audits.
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