The Impact of Establishment of Audit Committee and Internal Audit Unit on Improvement of the Financial Accountability of the Universities and Research Institutions

Abstract

Before 2005, financial accountability of using Iran universities' financial resources was held in the hands of treasury officers who were selected by the ministry of Finance and Economic affaires. From 2005, based on the fourth economic, culture and social program act, the financial control system changed and financial managers were selected by the heads of universities. This has made these universities presidents responsible for financial accountability of deploying and expending financial resources to board of directors and the supreme audit court since 2005. Because of this financial control system change, it seems that the establishment of Internal Audit unit and Audit Committee is essential in order to improve the financial accountability of such organizations. In this research we have tested this matter by means of questionnaires filled by accounting and auditing experts (Including financial officers, financial managers, independent auditors and supervisors) of those universities. According to our findings, the establishment of Internal Audit unit and Audit Committee in universities will have a major impact on improving the financial accountability of the mentioned organizations.

Keywords

• higher education and research institutions
• internal control
• financial accountability
• internal audit unit
• audit committee