Abstract:
Internal auditing of the organization measures the effectiveness of internal controls through
internal Auditors’ efforts. They assess whether the controls are properly designed,
implemented and working effectively and make recommendations on how to improve internal
controls. Internal controls play a vital role in operating day to day activities efficient and
effective manner. For that purpose internal audit supports by verifying the proper implication
of internal controls. The internal auditors’ preliminary evaluations of internal control in actual
audit engagements is required to make a study and evaluation of the existing system of
internal control for the purpose of determining the amount of reliance that may be placed on
the system. This research was conducted to investigate to the impact of internal audit on
verification of internal control application. The study was done as a survey and Harischandra
Mills Public Limited Company was selected as the research site. Sample was selected on
random basis with 100 respondents. Primary data for the study was collected by self
administered questionnaire and indepth interviews. Self administered questionnaire was
developed using 5 point likert scale considering the variables of internal audit and internal
controls. Secondary data for the study collected by internal audit reports and internal control
manuals. The collected data was analyzed using mean comparison, standard deviation,
chronbach’s alpha and correlation matrix. The study concluded that internal audit has a
significant impact to verify the internal control applications and it ultimately supervise the
proper usage of internal controls.
