Abstract:
Internal auditors are indispensable professionals for the effective risk management within every organisation. Therefore, the purpose of this study was to evaluate the functions of internal audit and its ultimate impact in ensuring effective risk management in Commercial banks in Ghana. Descriptive research was carried out using both qualitative and quantitative methods of research through the administration of questionnaire. A sample size of 45 internal auditors was used for the study and data was analysed using the Statistical Package for the Social Sciences (SPSS). It was identified that although most of the internal auditors within the commercial banks in Ghana are not registered members of the Institute of Internal Auditing, they are allowed to work independently without any hindrance from management of the banks. Moreover, it was identified that the functions of internal auditors are to review all internal controls, review processes and procedures, and make recommendations for management with regards to best practices in ensuring optimum productivity and performance of the bank. Additionally, the internal auditors of the commercial banks are involved in the risk management, risk mitigation, and risk monitoring. This has made the reports of internal auditors have much influence on management’s decisions in making and amending policies, business strategies, and guidelines, the introduction of new controls within the management of our products and services. Conclusively, a strong and positive relationship was established between functions of internal auditors and risk management and functions of internal auditors and impact of bank’s compliance to regulations within the banking industry. Therefore, it is highly recommended that the management of the bank should put in place a quarterly internal audit overhaul to strategically review all its risk management practices against expectations of the regulator.
