Proactive Internal Audit Strategy and Firm Performance: Empirical Evidence from Thai-Listed Firms
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Abstract
Over the past few decades, despite the fact that there has been an attempt to improve internal audit quality, frauds and corruption still occur. Moreover, black swan events bring about financial crises, which can shake the foundations of the global economy. This suggests ineffective internal audit functions at an organizational level, which lack integrating, building, and reconfiguring strategies. In particular, proactive strategies are required to adapt to ever-changing economic environments. Therefore, this research aims to investigate the effect of proactive internal audit strategies (PIAS) on firm performance. This study indicates that PIAS: internal audit system integration, participative internal audit, comprehensive business risk assessment, and advanced internal audit technology application have a significant effect on its consequences; except outsourcing internal audit utilization. Additionally, fraud prevention competency, superior operational excellence, transparent business practice, stakeholder credibility have a strongly positive effect on stakeholder credibility and firm performance. Moreover, this study also demonstrates that stakeholder credibility has a significant positive impact on firm performance.
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