Abstract
The advancement of technology has greatly aided industrial growth, including that of the
internal audit profession. Emerging technology can significantly enhance efficiency in the
internal audit process; however, internal audit functions (IAFs) are challenged to adapt to the
state and rate of digital transformation, and hence risk being viewed as not contributing any
value. Emerging technologies present the IAF with the possibility of reorganising its services
to continue to meet the evolving needs and expectations of its stakeholders. This research
discusses the barriers to the adoption of emerging technologies by the in-house IAF. The
study sought to determine the impact of these barriers on the effectiveness of the IAF. This
research makes key contributions to in-house IAF by identifying the specific barriers that
hinder IAF in implementing emerging technologies and the impact this has on IAF
effectiveness. The research findings will assist IAFs in determining how to harness emerging
technology to generate value and be regarded as a strategic partner by stakeholders.
A quantitative research method was appropriate for this study, and a questionnaire research
design was adopted. A purposeful sampling technique was used to select the respondents
that constitute the sample of this study. The population of the study is made up of the five
public research councils in South Africa, and the sample will be limited to the councils that
have an in-house IAF. Primarily, data was be collected using a structured questionnaire
directed at Chief Audit Executives (CAEs) as the executives of the IAF are responsible and
accountable for the performance of the IAF. The questionnaire was be limited to the CAEs of
the research councils in South Africa that have established an in-house IAF.
The empirical results indicate that in-house IAFs are still behind in digital innovations. While
to a certain extent the sampled councils have adopted emerging technologies at the
organisational level, their IAFs lack innovation, and some of the organisational barriers that
are impeding this advancement include lack of senior management support, the role of the
audit committee support, and an ineffective IAF. The specific barriers identified include a lack
of technological skills, lack of budget to invest in digital transformation, change in the internal
environment and business maturity, organisational support for using the technology, training
in technology usage, knowledge and awareness of the technology, embracing change
management and auditors’ attitude towards the emerging technology, the size of the
organisation, management support and buy-in, current technology being used by the
organisation, and the age of IT infrastructure in place. The findings imply that organisational
barriers to emerging technology adoption impact the overall effectiveness of the IAF. It may
be difficult for an ineffective IAF to contribute value or achieve certain organisational needs.
iv
To effectively adopt emerging technology, IAFs need great support from their stakeholders,
and the IAF itself must possess the right quality to enable an adaptation. Confronting these
barriers will improve the effectiveness of IAFs and ensure that they can integrate technology
into the internal audit service delivery model.
Key words: Internal audit function; Effectiveness; Technology; Emerging technology, Senior
management; Audit committee, Barriers