Effect of Internal Audit Practices on Financial Performance of Banks in Ghana

Abstract

Internal audit (IA) practices are considered as one of the key measures necessary for promoting healthy business activities. In this study, the researchers examine the effect of internal audit practices on the performance of banks in Ghana. The study used a sample of 154 respondents from 5 selected banks, the study adopted the quantitative research approach, data was analyzed using inferential statistical methods such as correlations and regression analysis. The study results indicate that there is a strong positive effect of monitoring, risk assessment and information and communication on the financial performance of banks in Ghana, whereas there was no significant effect of control environment and control activities on the financial performance of banks in Ghana. The study recommends that the management of banks should strengthen the control environment, by enhancing the policies and procedures adopted by the banks in safeguarding assets and properties, there is the need to continuously review the existing policies, procedures and activities performed to ensure that they have not outlived their usefulness in the wake of changing competitions and advancement in technology and management orientation.