Performance audit : the need for a responsive approach case study in Oman

Al Subhi, Sheikha S.

Abstract

In recent times performance audit has become a subject of attention, experimentation, application and debate in the public sectors across the global world. Performance audit is not a replacement for financial audit; indeed, it is a type of audit that aims to examine the economy, efficiency and effectiveness of a public sector entity. Thus an important role is reserved for performance external auditing executed by external state audit institutions, sometimes known as national audit offices.

A number of studies have criticized the contribution of performance audit in delivering recommendations that are not representative of citizens’ needs and/or preferences and do not consider social values. Thus this thesis examines whether performance audit practices and reporting take into account the public perspective and social value performance elements. Moreover, it concentrates on understanding the process of decision-making by performance auditors during their assessment and evaluation of public sector performance. The latter involves discussion and explanation of the approach implemented by performance auditors and how does certain types of information in the early stages of the auditing process influence their reporting process. Further, this research provides arguments regarding the contribution of performance audit in improving public sector services, and provides recommendations for decision-makers.

The Throughput model is used to form a theoretical framework allowing us to understand the relation between using performance information and performance perception, and judgement and decision-making in performance audit reporting. The different pathways show how auditors prioritize certain aspects of organizational performance in their assessment and decisions.

Auditors from the State of Audit Institution in Oman (SAI) participated in this study by responding to an online questionnaire. Structural equation modelling (SEM) via partial square least (PLS) was used as a data analysis approach to test the hypothetical relationships. The first stage used was the measurement model assessment, and the second stage was structural model assessment, via the smart PLS version 2. Additionally, indirect exploratory effects of the moderators (such as gender, age, experience level and educational level) were examined using multi-group analysis (MGA) method.

The findings show that auditors in performance audit rely heavily on performance information of the audited entity to make their judgements, and that their perception of social value and being public responsive does not impact upon their judgement. Simultaneously there was a direct relation between performance perception and decision-making, and a strong relation between judgement and decision choice (i.e. reporting) in performance audit. The findings located some areas of weakness in current performance audit practice. Moreover, the findings of this research may be of great value and have empirical contributions to make for government decision-makers, auditors of state of Audit institutions and managers of public sectors.

Citation

Al Subhi, S. S. (2016). Performance audit : the need for a responsive approach case study in Oman. (Thesis). University of Hull. Retrieved from https://hull-repository.worktribe.com/output/4222215

• Thesis Type: Thesis
• Deposit Date: Feb 27, 2020
• Publicly Available Date: Feb 23, 2023
• Keywords: Business
• Public URL: https://hull-repository.worktribe.com/output/4222215
• Additional Information: Business School, The University of Hull
• Award Date: Oct 1, 2016