Abstract: The paper examines the influence of internal audit independence on the financial performance of Small and Medium Enterprises in the construction industry in Mombasa County. The specific concern is to determine the effect of four components of internal audit independence namely: records accessibility, reporting structure, internal auditors ‘qualifications and internal audit roles on the financial performance of Small and Medium Enterprises in the construction industry in Mombasa County. The population was 65 Class 8 National Construction Authority (NCA 8). Systematic sampling is used in getting the sample size of the construction companies from different construction companies and expected sample derived from internal auditors, audit committee members and audit assistants of the sample population. The font size used is between10 and 24. The research reveals that some construction companies within Mombasa County do not accord the internal auditors the independence they deserved to effectively give their opinion on the financial statements of the organizations. SMEs should be given Public education by the Minister for commerce and industry on the importance of internal audit independence. The government should establish an internal audit unit, which should be independent to ensure that all SMEs in Kenya comply with the laid down audit procedures and rules.
Keywords: Internal Audit, Audit Independence, Small and medium enterprises, Construction Industry, Auditing, Financial Performance.
Title: The Influence of Internal Audit Independence on the Financial Performance of Small and Medium Enterprises: A Case of the Construction Industry in Mombasa County
Author: Harrison Kiema, Anwar Ahmed, Jane Ndirangu
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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