Objectives: This study aims to examine the impact of the effectiveness of the risk management process on risk-based internal audit practices. It focuses on understanding how various factors contribute to strengthening risk management and its subsequent influence on auditing approaches. Methodology/Design/Approach: This quantitative, survey-based research utilized a Likert-scale questionnaire adapted to the Iranian context. Out of 436 distributed questionnaires, 408 were validated and analyzed. Partial Least Squares Structural Equation Modeling (PLS-SEM) was employed using SmartPLS software. The reliability and validity of the constructs were confirmed, and the hypothesized relationships were tested using path coefficients and t-statistics. Findings: The results indicate significant relationships between internal auditors’ responsibilities, risk management training, and management support with the effectiveness of risk management. Additionally, a significant association was found between risk management and risk-based internal auditing. The findings further show that risk management acts as a mediating variable in the relationship between internal auditors’ roles and management support with risk-based internal auditing; however, it does not significantly mediate the relationship between risk management training and risk-based internal auditing. Innovation: Grounded in Iran’s economic and organizational context, this study fills a gap in domestic literature and demonstrates the evolving role of internal auditors. Beyond their traditional duties, internal auditors increasingly engage in monitoring, assessing, and evaluating risks that may hinder organizational objectives. They also play a growing advisory role to management, as managers remain responsible for implementing and executing risk mitigation strategies within business entities.
Moghaddam et al. (Thu,) studied this question.