INTERNAL AUDIT MANAGEMENT PRACTICES OF SELECTED COOPERATIVES IN MOUNTAIN PROVINCE
RACHEL F. FAGYAN

ABSTRACT

The study aimed to assess the internal audit management practices of selected cooperatives in different municipalities of Mountain Province. It focused on the level of knowledge of the Audit Committee and the Board of Directors (BODs)on internal audit management practices; the extent of application of internal audit management practices; the relationship between the level of knowledge and the extent of application of the BODs and the audit committees on internal audit management practices; and the level of influence of factors affecting the level of knowledge and application on internal audit management practices of the members of the Audit Committee and the Board of Directors.

The study concentrated on cooperatives categorized as Small and Medium Entities (SMEs). Using purposive sampling method, the study consisted of 104 total respondents which included 69 BODs, and 35 Audit Committee members. Questionnaires and informal interviews were used to gather data.

Findings show that the BODs and the Audit Committee were both moderately knowledgeable of the internal audit management practices. The internal audit management practices by the BODs and the members of the Audit Committee were moderately applied. Statistical inference showed that a significant difference on the level of perceptions of the respondents on the extent of applying internal audit management practices.

The level of knowledge of both the BODs and Audit Committee members is significantly associated to their internal audit management practices.

From the findings, it could be concluded that both the BODs and Audit Committee members were knowledgeable and practicing some internal audit management practices but there are still concepts which are not known and practiced by them. It can be further concluded that there are various factors affecting the internal audit management practices of the BODs and Audit Committee members such as their knowledge on internal audit management, presence of cooperative policies on the conduct of audit and the presence of audit manuals or auditing systems and procedures.

With the above conclusions, it is thus recommended that the BODs and the Audit Committee members to attend trainings on internal control, audit management, financial management, and applicable rules and regulations affecting the cooperatives. Further, Operation Manual, Internal Audit Manual and written internal control policies and procedures should be crafted and approved by cooperatives and be provided to the BODs and Audit Committee members. Finally, a standard audit committee report should be made by the cooperatives to capture all the findings and recommendations of the Audit Committee.