European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) DOI: 10.7176/EJBM Vol.11, No.7, 2019 108 The Impact of Ethics & Objectivity of Internal Audit Personnel on Transparency & Accountability Case of Zimbabwe Local Authorities Moses Jachi 1 Lucky Yona 2* 1. Midlands State University P. Bag 9055, Gweru, Zimbabwe 2. Eastern and Southern African Management Institute P.O. Box 3030, Arusha, Tanzania Abstract The study aimed at examining the impact of Ethics & Objectivity of Internal Audit Function on transparency and accountability. The study adopted ethics & objectivity (as determined by internal auditors’ personal needs strength and enhanced by the Chief Audit Executive’s leadership style), as the independent variable and transparency & accountability as the dependent variable. The effect of internal audit function on transparency & accountability was assessed through management perception, organization policy, auditees’ cooperation and risk exposure of the organization. Survey data was obtained from a sample of 182 internal audit and management personnel from local authorities in Zimbabwe using semi-structured questionnaires. Correlation and regression analysis were used to test the hypothesis that internal audit function ethics & objectivity is positively associated with transparency and accountability. Study findings reveal that internal audit function ethics & objectivity is positively associated with transparency & accountability. The study established the need to improve operational paradigms guiding internal audit in Zimbabwe local authorities so as to empower internal audit functions and ensure they judiciously act in the best interest of the public, especially in circumstances where the general ethical conduct of their respective local authorities is defective and against public interest. Keywords: Ethics &Objectivity, Internal Audit Function, Transparency & Accountability DOI: 10.7176/EJBM/11-7-09 Publication date:March 31 st 2019 1. Introduction Ease of accessing information obtained by a government is a concern for every taxpayer (Neu, et al., 2013; Roussy & Brivot, 2016), because of the strong linkages that exist between transparency and ethical issues concerning corruption and administrative deviations (Piotrowski & Bartelli, 2010; Adiputra, et al., 2018). Ethics as a philosophical concept refers to a branch of knowledge that deals with ideal human behaviour, which relates to practices that result in highest levels of well-being (Billington, 2003). Applied in business context on a broader perspective, ethics concerns ideal practices and decisions by corporate players founded from a moral framework (Pinnington, et al., 2007), within which the ethical and unethical parameters are defined in the context of justice and humanity (Kinicki & Williams, 2013; MacDougall, et al., 2015). Billington (2003) outlined crucial tenets about ethics and morals, asserting that individuals cannot avoid making moral or ethical choices because societal connections call for moral and ethical actions (Billington, 2003). This entails that a rational internal auditor has an ethical and moral obligation to make an objective decision because the position he hold arouses societal expectations for him to act like wise (Billington, 2003; Carmichael, 2004; Holt & DeZoort, 2009; Christopher, et al., 2009; West, 2017). Objectivity of internal audit personnel is a personal trait that enables them to maintain impartiality, eliminate bias and safeguarding against conflict of interests (Abu-Azza, 2012). The Institute of Internal Auditors’ International Standards for the Professional Practice of Internal Audit overemphasise on the close relatedness of the concept of objectivity to independence (IIA, 2016). However, considering the extent of non-audit services resident internal auditors are usually associated with, the unavoidable personal relationships that build with people working together (Venasco, 1994; Kimotho, 2014), the question remains as to how a resident internal auditor can significantly hinge on independence for objectiveness. The increased recognition of the role of internal audit services towards more of a management-service (Kimotho, 2014; Roussy & Brivot, 2016) which comes with commensurate familiarity and social pressure threats requires a different view of the sources of strength of internal auditor objectivity towards an ethics bias than independence. With the recently gained significance of internal audit to the organizational governance processes (Jennnings, 2003; Brown, et al., 2003; Moeller, 2004; IIA, 2016), it can be appreciated that the performance of auditors is not only being affected by their special skills, organizational setups, but also by their ethical decision making ability (Woodbine & Liu, 2010). In practice, the ethical standards of internal auditors are often challenged by dilemmas involving split loyalty, the expectation gap and conflict of interests between various parties (Venasco, 1994; Larking, 2000; Woodbine & Liu, 2010). The recent developments within the internal audit profession have motivated a number of studies in to the profession tasks and activities. However, no much research has focused on