FACTORS AFFECTING THE RELATIONSHIP BETWEEN INTERNAL AUDIT AND EXTERNAL AUDIT IN BANKS AND THEIR IMPACT ON STRENGTHENING THE INTERNAL CONTROL SYSTEM AND REDUCING THE COST OF EXTERNAL AUDITING

Abstract

From the viewpoints of internal auditors and external auditors on banks located in Istanbul, this study looked for to discover the variables influencing the interaction between internal audit alongside external audit, as well as their effects on improving the internal control system and lowering the cost of external audit. In order to achieve its aims, the study developed a questionnaire that was appropriate for the study's subject and objectives, and (262) questionnaires were delivered to external auditors who do audits on banks and to internal auditors employed by banks operating in Istanbul. Utilizing (262) questionnaires with a 100% recovery rate, the study employed the descriptive statistical analysis technique to identify and evaluate the study variables. The study's conclusions demonstrated how vital it is for internal audit with external audit to play complimentary roles in attaining performance for banks by bolstering the internal control system and minimizing the external auditor's fees. The audit committee is crucial in encouraging the mutually beneficial connection between the internal auditor and the external auditor as well as the external auditor's dependability on the internal auditor's function. It is also crucial in fostering the two parties' dedication to continuous learning in order to foster mutual competent trust. These elements all work together to enhance the partnership, coupled with the two sides' regular and efficient communication and consultation. The study's conclusion included a number of recommendations. The audit committee must correctly do its duty by outlining requirements that will improve the chance of cooperation between internal and external auditors, with that being the most important.. The professional should remain up to date on developments in the banking industry and be willing to interact and discuss their business goals in order to reduce redundancy and complete effective audits