Audit committee attributes, internal audit function, and fraud risk management: a case of CGIAR organizations in Kenya
Date
2025
Authors
Owiti, P. A. O.
Journal Title
Journal ISSN
Volume Title
Publisher
Strathmore University
Abstract
More than ever, all stakeholders in an entity must work collaboratively to effectively tackle the ever rising risk of fraud. The role of the audit committee has been determined to be central in effectively managing fraud risk in organisations. Whilst numerous past studies have been conducted on the effect of audit committee attributes on fraud risk management their conclusions have been varied. Additionally, these studies did not consider the moderating variables between the audit committee attributes and fraud risk management. Consequently, these past studies demonstrated geographical, contextual, methodological, and conceptual gaps. This study’s objective was to contribute in bridging the noted research gaps by assessing the level of influence of the audit committee attributes on fraud risk management in organizations and the moderating effect of the presence of an internal audit function. The study was conducted on nine CGIAR organizations with a presence in Kenya, targeting a sample of 185 respondents selected through stratified random sampling. It applied the quantitative research design and used a questionnaire with closed-ended questions and a 5-tier Likert scale for data collection. Ordinal logistic regression was used to test the direct influence of audit committee attributes on fraud risk management. The study's findings revealed that the audit committee attributes i.e. composition, independence, meetings, and expertise significantly predicted variations in fraud risk management. The moderation model demonstrated that the internal audit function significantly enhanced the relationship between audit committee attributes and fraud risk management. The study concluded that audit committees that had well constituted and inclusive memberships; that were functionally relationally, and structurally independent; that held frequent and well-structured meetings; and that had committee members with adequate financial know-how were critical in achieving effective fraud risk management. Further, the study also concluded that the presence of internal audit functions enhanced the effectiveness of audit committees in enhancing fraud risk management. The study recommended that policymakers, regulators, CGIAR headquarters, and CGIAR organizations enhance the characteristics of audit committees and institute fraud risk framework. The findings of the study will also inform future research into the interplay between audit committee characteristics and the internal audit function on fraud risk management. The study’s limitations included the limitation of scope to CGIAR organizations; the application of a quantitative methodology which excluded information that could have been derived from adding qualitative approaches; and the exclusion of audit committee members as respondents to the study.
Description
Full - text thesis
Keywords
Citation
Owiti, P. A. O. (2025). Audit committee attributes, internal audit function, and fraud risk management: A case of CGIAR organizations in Kenya [Strathmore University]. http://hdl.handle.net/11071/15732