A risk-based internal audit methodology for Greek local government organizations

Michail Pazarskis, Andreas G. Koutoupis, Maria Kyriakou and Stergios Galanis

Abstract

Internal audit activities have been expanded worldwide in order to protect local government organizations and, in particular, municipalities. Although several previous studies have examined internal auditing in local government organizations worldwide and provided further development in this area, none of them have developed a methodology for identifying and evaluating the possible risks when preparing an audit plan in municipalities in relation to Greece and elsewhere. This paper aims to address this gap and to ensure the adequate identification, assessment and linkage of the risks that characterize the municipality within the audit universe, leading to the corresponding preparation of an audit plan based on audit priorities. Further, the proposed methodology follows the International Professional Practices Framework and the International Standards for the Professional Practice of Internal Auditing.