Abstract

Purpose - To examine the influence of internal auditor characteristics on the effectiveness of internal audit with moral courage as a moderating variable in the banking industry in South Sumatra and Jakarta. Design / methodology / approach - The data analysis method used is Structural Equation Modeling (SEM) by implementing the rule of thumb assessing Convergent Validity, Discriminant Validity, Reliability, F test hypothesis testing, Coefficient of Determination (R2), Moderated Regression Analysis (MRA) and t test. Findings - The results showed: Characteristics of Internal Auditors, Moral Courage has a positive and significant effect on the effectiveness of internal audit. Moral courage weakens the influence of the characteristics of internal auditors on the effectiveness of internal audit. Internal auditors have a weak attitude of moral courage by considering concurrent positions. Practical implications - The characteristics of the Internal Auditor must refer to the attributes that must be possessed by each internal auditor, among others; capability, integrity, objectivity, effective communication, proficiency, appropriate professional experience, as well as training and development as well as paying attention to strong locus of control and ethical awareness in audit assignments. Originality / value - In contrast to most previous studies, this study is located on indicators of the characteristics of internal auditors (integrity, capability, locus of control and ethical awareness). In addition, the second novelty lies in the effective role of internal audit in improving corporate governance, risk management and management control