(2012) further noted that for effective management of SACCO resources, audit committee members should possess a wide range of knowledge, skills and personal attributes including sound judgment, integrity and high ethical standards; strong interpersonal skills and the ability and willingness to challenge and probe. Omondi (2012) indicated that, specifically, audit committee members must have expertise, or access to expertise, that goes beyond mere familiarity with financial statements. They must be able to understand the rules, and, more importantly, the principles that underpin the preparation of financial statements. That is, they must be prepared to invest the time necessary to understand why critical accounting policies are chosen, how they are applied and
44 satisfy themselves that the end result fairly reflects their understanding (Omondi, 2012). These assertions affirm the fact that, in determining the composition of the audit committee, it is important to balance formal qualifications with consideration of personal qualities and relevant experience. Majority of the sampled respondents (74.5%SACCOM and 59.9%ISACCOA) strongly agreed with the view that remuneration of internal auditors is considered when forming internal audit committees. 17.0% of the sampled SACCO Managers and 27.4% of the sampled Internal SACCO Auditors agreed. At the same time, 2.5% of the sampled SACCO Managers and 3.3% of Internal SACCO Auditors were undecided, 3.5% of SACCO Managers and 5.7% of the Internal SACCO Auditors disagreed whereas 2.5% of the sampled SACCO Managers as did 3.7% of the Internal SACCO Auditors strongly disagreed. These findings point to the fact that the role of the audit committee is for the board to decide, and it should tailor its terms of reference to the SACCOs’ specific needs and clearly outline the committee’s duties and responsibilities, including structure, process and membership requirements. This is indicative of the fact that, considering the financial expenditures and the intense public scrutiny placed on SACCO boards, the SACCO managers must act to establish effective and transparent audit committees. 4.5 Stakeholders’ Involvement in Internal Auditing As per research objective three, the researcher intended to establish how often stakeholders are involved in internal auditing and factors which are considered when involving audit stakeholders in internal auditing in SACCO. Data was collected from SACCO Managers and Internal SACCO Auditors and the results are shown in Table 10;
45 Table 10: Frequency of Audit Stakeholders in Internal Auditing of SACCOs Frequency of Stakeholders’ Involvement SACCO Managers Internal SACCO Auditors f % f % Very Often Often Sometimes Rarely Never 10 6 7 12 10 17.9 21.4 25.0 42.9 35.7 27 25 36 46 65 24.1 22.3 32.1 41.1 58.0 Table 10 indicates that a fair proportion (42.9%) of the SACCO Managers indicated that stakeholders are rarely involved in internal SACCO auditing, 35.7% indicated never, a quarter (25.0) indicated sometimes, 21.4% indicated often whereas a paltry 17.9% indicated very often. In the same vein, slightly more than half (58.0%) of the internal SACCO Auditors
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