Influence of Institutional and Decision Usefulness-related Factors on the effective Implementation of External Auditor’s recommendations in Tanzania’s Ministry of Finance (Vote 50)

Abstract

This study investigates the influence of auditee organisation Institutional and
auditee individual actors’ decision usefulness factors on the effective
implementation of the Controller and Auditor General’s Recommendations in the
Central Government. The study employed a Descriptive and explanatory study
designs, with the Ministry of Finance (Vote 50) selected due to its pioneering and
exemplary role in financial management of the country. Data were collected using
structured questionnaires administered with key staff of the Ministry of Finance
(MoF). The study found that the critical auditee organisation institutional factors
including pressure from the accounting and auditing professional board, followed
by pressures from development partners/donors, public pressure, the relationship
between CAG and his clients, adoption of ICT (EPICOR, LAWSON) and
government laws. Overall, the findings illustrate the role of institutional theories
(OIE and NIS) in explaining the auditee institutional environment that shape the
effective implementation of CAG’s recommendations by public officers.
Furthermore, the findings reveal the critical auditee individual actor factors
including skills and knowledge in effective implementation of CAG’s
recommendations. On the other hand, limited professional liability by public
officials emerged as an impediment to effective implementation of the CAG
recommendations. Thus, the study findings appreciate the role of the decision
usefulness concept that promote understandability acquired from skills and
knowledge for the effective implementation of CAG’s recommendations by public
officers. The study findings also posit that public officers need to practice the
professional liability, which was currently unappealing. In a nutshell, the study
has established both institutional and decision usefulness factors that are
significantly related to effective implementation of the CAG recommendations by
public officers in the emerging economy contexts, with Tanzania serving as an
example.