Impact of internal audit and internal control on the reduction of managerial opportunism: An empirical study on Moroccan companies

Abstract

The question of the opportunism of business leaders has given rise to a very long- winded literature which has returned to the Centre of current concerns, particularly in various scientific disciplines, and also in the concerns of policy makers. The purpose of this paper is to examine the impact of internal control and internal audit on the opportunistic behavior of managers of a sample of 59 Moroccan companies located on the Rabat- Casablanca axis.

This articles seeks to present the problem of opportunism of leaders by borrowing the theory of rootedness was developed in the late of 80s by A.Sheleifer, R.W.Vinshny and R.Morck. The contribution of this theory is important for analyzing the opportunistic strategies of managers and their implications on the company’s performance and on control systems, our ultimate objective is to seek to provide answers to the following questions: to what extent do internal control and internal audit actually contribute to reducing the opportunism of leaders?

To answer this delicate question, we confronted our reflections in the field based on a quantitative study and used the SPSS version 22 statistical analysis software to measure the intensity of the causal relationship between the variables.

The contribution of this study to the current empirical review is to provide some lessons and observations from the field. The theoretical discussion of these observations also allowed us to propose patterns of cause and effect relationships between internal control, internal audit and the opportunism of the managers of companies in Morocco. 

All these findings lead us to confirm that the impact of the internal audit and internal control of the reduction of executive expediency is quite heavy. In addition to opportunism in the enterprise, the analysis of the opportunism oh the leaders of family groups be the subject of new research.

Keywords: internal control, internal audit, opportunism, specialist committee, special investment 

JEL Classification: M40

Paper Type: Empirical Research