THE NEXUS BETWEEN INTERNAL AUDIT INDEPENDENCE AND FIRM PERFORMANCE OF LARGE FIRMS: THE CASE OF ROMANIA AND POLAND

The influence of internal auditors on firm`s performance represents an ongoing debate between scholars and practitioners, academics and regulators, managers and auditors. This study examines whether the audit characteristic such as internal auditors independence has an influence on firm performance. We use a series of linear regression estimations in order to test the influence of internalauditor’s independence on firm performance for a sample of large companies from Romania and Poland. Overall, our results indicate, that an independent internal audit committee has a beneficial influence on company performance in listed and unlisted companies. Thus increasing the independence of the internal audit committee can lead to a higher resource management of the company, which is reflected in an increase in the overall performance. A more independent internal audit committee can lead to a higher performance in the companies from Romania and Poland.