MATTU UNIVERSITY

COLLAEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ACCOUNTING AND FINANCE

ASSESMENT FACTORS AFFECTING RURAL HOUSEHOLD’S

OF
SAVINGS HABIT IN MATTU WOREDA, ILUBABOR ZONE , OROMIA
REGIONAL STATE.

RESEARCH PROPOSAL SUBMITTED TO MATTU UNIVERSITY COLLEGE OF

BUSSINESS AND ECONOMICS DEPARTEMENT OF ACCOUNTING AND FINANCE
IN PARTIAL FULLFILLMENT OF THE REQURMENT OF BA DEGREE

PREPARED BY: KEYRU IBRAHIM (ID NO: -EV0349/13)

ADVISOR: MR. YOHANIS. (MSC)

January,2025
Mattu,Ethiop
 CHAPTER ONE
INTRODUCTION
1.1. Background of the organization
The state Bank of Ethiopia was found in 1942 with an objectives forming the duties of both
commercial and central bank in 1963 established as share company to take over the commercial
banking activities of the state bank of Ethiopia. In the 1974 revolution, commercial bank of
Ethiopia got its strength by emerging with privately owned Addis Ababa Bank. Since then it has
been playing significant role in the development end over the country.
The Commercial Bank of Ethiopia, which is striving to embark in to world class commercial
Bank, rendering state of the art and reliable service to its millions of customers both locally and
abroad. The business strategy of the bank focus on the stake holders it serves.
On April 30, year 2011 the number of branches reached 362 and stretched across the length
breadth of the country. CBE combines a wide capital base with more than 9700 talented and
committed employees. In 2011 whom it regard as its key asset for banking development.
The state owned commercial bank of Ethiopia still dominates the market in terms of asset
deposit, capital and customers base and branch network, deposit the growing competition from
private Bank over the last 15 years.
This make it one of the most reliable and strong commercial Bank in the country and the region.
Its strong capital base above 67 years of rich experience in the market and large branch network
throughout the country enable the bank to accommodate large demand for banking service, bank
from private and public companies and to increase its over all revenue on sustainable bases.
1.2 Background of the study
Different change and factor have been influenced the auditing profession in recent year.
Technology announcement and regularity bodies have caused the auditing policy to re examine
its purpose intention and methodology because of this the profession has improved from
transaction based approach to arise based focus. There fore all these change have affected the
internal auditing components of profession

Auditing is an important activity for all types of organizations where governmental, private for
profit, non profit or any other. Auditing is a systematic process of objectively obtaining and
evaluating evidence regarding assertions about economic actions and events to ascertain the
degree of correspondence between those assertions and established criteria and communication
the result to interested user (Konrath, 1999, P.2).

The need for auditing, either external or internal auditing is increasing from time to time by
because it enables organizations that their resource have been utilized for intended. Internal
auditing is an independent, objective assurance and consulting activity designed to add value and
improve as organizations operations it help an organization accomplish its objectives by bringing
a systematic disciplined to evaluate and improve the efficiencies of risk management, control and
governance processes.

Internal audit is an independent appraisal functions with in an organization to examine and

evaluate its activities as a serve to the organization. The objective of internal audit is to assist
members of the organization in the effective discharge of their responsibility.

In all large organization important elements of internal control is the internal auditing staff.
Internal auditors are professional level employees with the responsibilities of investigating
through out the company the efficiency of operations is every department or other organization
unit. They are continuously studying and testing the system of internal control and reporting to
top management on compliance with company standards and on problem which require
strengthening of internal control.

An internal audit function can provide assurance to management that the broad objectives of the
internal control are being achieved. Internal audit encompass the examination and evaluation
adequate and effectiveness of the organization. System of internal control and quality of
performance carrying out assigned responsibilities.

Internal auditing always support management in ensuring that there is a proper internal control
system in practice and that the operations of the company are carried out effectively, efficiently
and economically. Internal auditors who perform their job effectively may become expertise in
the design and implementations of all other types of controls.

Commercial bank of Ethiopia Agaro branch was established date 1967-07-01, with the manager
name was Donis Alemu Ayana. It is sub branch of Jimma, the distance from Jimma 45km and
Addis Ababa 390 km.

1.3. Statement of the problem

Internal auditing is examination of internal system in which functions by measuring and
evaluating effectiveness of other control. Internal auditing is an independent appraisal function
established with an organization to examine and control its activities as a service to organization.
Internal auditing review operational procedures to ascertain whether the results are consistent
with established objective and goal.
The auditor’s broad view of trends and control helps raise awareness of risks before they become
problems that can affect virtually every business unit with in an organization. The researchers
observed that previous researches conducted by other researchers did not show in how to
encourage the organization to prepare strong internal audit reports. This study would try to assess
the performance of internal auditing through analyzing the internal auditing practice of CBE
Agaro Branch and recommend or give solution for the problem observed so far.

Research questi
 Does thesno auditor of the organization apply audit standards, procedures and polices
in oworking environment ?
 Does the audit of the organization proceeding on the basis of independent
professional ?
  Are the audit procedures, including the testing and sampling techniques properly
used?
 Does the internal audit in CBE are skilled in dealing with people in communicating
effectively?

1.4 The objectives (purpose) of the study

1.4.1. General objectives
The general objective of the study is to evaluate and examine whether the commercial banck of
Ethiopia’s internal auditing practice is effective and efficient or not.

1.4.2 Specific objective of the study area

 To assess the importance of internal auditing system in the existing condition with in the
CBE.
 To identify the quality of internal audit worker in commercial banck of Ethiopia.
 To encourage the organization to prepare strong internal audit reports.
 To assess internal auditing as internal control.
 To assess limitation of internal auditing practices.

1.5. Significance of the study

This study would contribute many of organizations and various individual:
 Various problems that related to internal auditing would be investigated and presented
and presented to the organizations for the purpose of coping with it.
 The finding of this study suggest the possible solution of internal auditing related
problems that leads the organization to apply the proper internal auditing principle.
 The finding of this research helps the researchers to elaborate the knowledge and know
how about internal auditors.
 This helped the auditor in this organization to know their role in the organization.
1.6. Scope of the study
The scope of this paper covers internal auditing practice of commercial bank of Ethiopia Agaro
Branch. The researchers emphasize on how internal auditing practice were applicable in practice.
This study deal with the quality and application of internal auditing and the division of the
internal audit department.

1.8. Organization of the study

In general the research paper consists five chapter.
The first chapter involves sub-topics such as backgrounds of the study, statement of the
problem, purpose of the study, important of the study, scope of the study limitation of the
study, organization of the study. The second chapter deal with literature review of internal
audit role. The third chapter deal the methodology of the study. The forth chapter consist of
data analysis. The last chapter describes the summary conclusion and recommendation
 CHAPTER TWO
LITRATURE REVIEW
2.1. Basic Concepts of Auditing
Concepts are abstractions derived from experience and observation and are designed to aid
understanding of the similarities with in a subject matter and the difference from other subject
materials. Much like engineering, physics, economics, and sociology and other physical and
social sciences, auditing is based up on a series of fundamental concepts. The importance of
auditing concept is that they are the basis for standards, the guidelines or measures of quality
from which audit procedures are derived. Together, therefore auditing concepts, standards and
procedures are related (kinrath, 1999,pp1-4).

2.2 Definition of auditing

Auditing is the content of Dianetics and scentology is an activity where a person trend in
auditing listens and gives auditing, commands to a subject, which scientology refers to has
“preclear” critics of auditing have suggested it has similarity with cult style programming and
some behavior modification techniques which result psychological manipulation of the subject,
Auditing involves the use of processes which are sets of questions asked or directions given by
an auditor. When the specific objective of any one process is achieved, the process is ended and
other can then be used by doing this, the subjects are said to be able to free themselves from
unwanted barriers that inhibit their natural ability.
Auditing is the accumulation and evaluation of evidence about information to determine and
report on the degree of correspondence between the information and established criteria.
Auditing should be done by a competent independent person (Arens, 1997,p.2).

2.3 Types of Audits and Auditors

2.3.1 Types of auditing
According to Arnes (1997, pp,4-6) there are three types of auditing: operational Audits,
compliance audits, and audits of financial statements.

Operational audits:- an operational audit is a review of any parts of an organization operating

procedures and methods for the purpose of evaluating efficiency and effectiveness. Because of
many different areas in which operational effectiveness can be evaluated it is impossible to
characterize the conducted of a typical operational audits.

In one organization, the auditor might evaluate the relevancy and sufficiency of information used
by management in making decision to acquire new fixed asset, while in the different
organization the auditor may evaluate the efficiency of the paper flow in processing sales. In
operational audit, the reviews are not limited to accounting.

Compliance Audits:- the purpose of a compliance audits is to determine whether the audit is
following specific procedures or rule set down by some higher authority. A compliance audit for
private business could include determining whether accounting personnel are following the
procedures prescribed by the company controller. Reviewing wage rates for compliance with
minimum wage laws, or examining contractual agreement with banks and other lenders to be
sure the company is compiling with legal requirements. Results of compliance audits are
generally reported to some one with in the organization unit being audited rather than to be broad
spectrum of user.

Audits of final statements:- an audit of financial statements is conducted to determine whether

the overall financial statement the quantifiable information being verified are stated in
accordance with specified criteria. The criteria are generally accepted accounting principals,
although it is also common to conduct audits of financial statement prepared using the cash basis
or some other basis of accounting appropriate for the organization. The financial statement most
commonly included are the statement of financial position, income statement and statements of
cash flows, including accompanying foot notes.
2.3.2 Types of Auditors
The four most widely known types of auditors are (Arens, 1997, P. 6&7)
General Accounting office (GAO) Auditors:- the united state (US) is a non partisan agency in
the legislative branch of the federal government. The GAO which is headed by the comptroller
general, report to and is responsible solely to congress. Many of the GAO’s audit responsibilities
are the same as those of a certified public accountants (CPA). Mach of financial information
prepared by various government agency is audited by the GAO before it is submitted to
congress. In many states, experience as GAO auditors the experience requirement for becoming
CPA.

Internal revenue agents:- the internal revenue services (IRS) under the direction of the
commissioner of internal revenue, has as its responsibility the enforcement of the federal tax
laws as they have been defined by congress and interpreted by the courts. A major responsibility
of IRS is to audit the returns of tax payers to determine whether they have complied with tax
lows. The auditors who perform these examinations are referred to as internal revenue agents.

Internal auditors:- internal auditors are employed by individual companies to audit for
management much as the GAO does for congress. The internal audit group in some legal firm
can include over a hundred persons and typically report directly to the president, another high
executive officer or even the audit committee of board of directors.
Internal auditors responsibilities vary considerably, depending on the employer some internal
audit staff consist of only one or two employees who may spend most of their time doing routine
compliance auditing. Other internal audit staff consists of numerous employees who have diverse
responsibilities, including many outside accounting areas.

Certified public accountant (CPA):- CPA firm have as their primary responsibility the
performance of audit function on published financial statement of all publicly traded companies,
most other responsibly large companies and many small companies and non commercial
organization. The use of the title certified public accountant (CPA) is regulated by state law
through the licensing department of each state.
2.4 Internal Auditing
2.4.1 Definition of internal Auditing
An independent appraisal function established with in an organization. Internal auditing is
control function that exists by examining and evaluating the adequacy and effectiveness of other
control. The institution of internal auditor (IIA) defines the internal auditing as an independent
appraisal activity established with in an organization to examine and evaluate its activities as
service to the organization. This definition explains that internal auditors (profession of internal
auditing) has being done the extent and nature of assignment performed and the action taken by
the managements as result internal audit report. This is the activities with in the organization and
internal auditors must have in departmental in mental attitude to world the appraisal of internal
auditor.

2.4.2 Objectives and scope of internal audit

A wide range of activities will-being done by the internal audit department. These activities may
broadly be classified as financial and operational audits. Under the former may be included:-
 A continuous review of internal accounting controls
 The scrutiny of reports and statements, financial or operating, as prepared for
management purposes
 The ascertainment of the extent to which the asset of the organization are accounted for
and safeguarded from losses or damages.
 The examination of balance sheet items, test of balance and transactions as to their
authenticity through appropriate tests; etc. Under operational audit may be include
 The study and assessment of operating practices to promote increased efficiency and
economy
 The examination and ascertainment of the extent to which established policies, plans and
procedures are complied with
 The assessment of budgetary standard setting
 The assessment of the level of performance in successfully discharging duties and
responsibilities assigned
  A carry out of audits to determine whether operating objectives, targets and associated
control procedure are properly instituted and the degree to which the desired results are
achieved

2.4.3 The reason for internal auditing

Audits are made for number of reasons. Some stem from the accountability that subordinates
own to their superiors for the accomplishment of task. This has given risee to the theory of
agency the owners as principal, the manager as agent. The agent must provide objectively that
tasks have been efficiently and effectively accomplished. The jobs of most managers are two
extensive to accomplish by themselves. The managers need the help of skilled internal auditors
(KONRATH, 1999, P.676-677).

2.4.4 Responsibility of internal audit

The some responsibilities of internal audits are as follow
 Responsible for evaluating design and effectiveness of compliance function
 Develop long –range audit plan
 Audit of new management areas to evaluate internal control system
 Follow-up on significant findings from pervious audit
 Audit /review operational areas for stewardship of resources and compliance with
established policies and procedures.
 Review internal administrative and accounting control to safeguard resources and ensure
compliance with laws and regulations.

2.4.5 Code of Ethics for internal auditors

the purpose of code of ethics is to promote all ethical culture in the profession of internal
auditing. A code of ethics is necessary and appropriate for the profession of internal auditing
founded as it is on the trust places in its objective assurance about risk management control and
governance the code of ethics extended beyond the definition of internal auditing to include two
essential components.
1. Principles
2. Rule of conduct
In the code, the six principles are identified as follows:
 Responsibilities
 The public interest
 Integrity
 Objectivity and independence
 Due care
 Scope and nature of services

Responsibility
CPA’s render important and essential services in our free enterprise system all members have
responsibilities to those who use their professional services. In addition, members have an on
going responsibility to cooprate with other member to:
 Improve the art of accounting
 Maintain the public’s confidence in the profession
 Carry out the self regulatory activities

The public interest

Members should accept the obligation to act in a way that will serve the public interest, honor the
public trust, and demonstrate commitment to professionalism. The public interest is defined as
the collective well-being to the community of people and institutions that CPAS aerie the CPA’s
public interest includes clients, creditor, grantors, governmental agencies, employees, stock
holders, and the general public.

Integrity
To maintain and brooders public confidence, members should perform all professional
responsibilities with the highest sense of integrity. Integrity is a personal characteristic that is in
dependable in CPA. This element is the benchmark by which members must ultimately judge all
decisions made in engagement integrity is also the quality in which public trust is based.

Objectivity and independence

A member should maintain objectivity and be free of conflicts of interest in discharging
professional responsibilities. A member in public practice should be independent in fact and
appearance when providing auditing and other attestation seervices.

Objectively is a state of mind although this principle is not precisely measurable, it

nevertheless is held up to members as and imperative objectivity means being impartial and
unbiased in all matters pertaining to an engagement. Independence is the corner stone of the
profession’s philosophical structure.

Due care
Member should observe the profession’s and ethical standards, strive continually to improve
competence and the quality of services, and discharge professional responsibility to the best of
the member’s ability the principle of due care is at the center of the profession’s on going quest
for excellence in the performance of professional services. Due care requires each member to
discharge his her professional responsibilities with competence and diligence.
 Competence is the product of education and experience
 Diligence involves steady, earnest, and energetic application.

Scope and nature of services

Member in public practice should observe the principle of the code of professional conduct in
determining the scope and nature of service to be provide. This principle applies only to a
member who renders services to the public.

2.5 The relationship of internal and external auditors

2.5.1 Similarities
More specifically, the work of both the internal and the external auditor is carried out largely by
similar methods in such areas as:

 Both must be competent as auditors and remain objective in performing their audits,
including planning and performing test of control and substantive tests.
  An effective system of internal check to prevent and /or detect errors and fraud and that it
is operating satisfactorily.
 An adequate accounting system to provide the information necessary for preparing true
and fair financial statements.
 Examination of the soundness and effectiveness of internal cheek
 Examination and checking of accounting records and statements
 Verification of asset and liabilities
 Observation, enquiry, the making of statistical comparison and other measures as may be
judged necessary.
 Performance of detailed examination of balance and transaction

2.5.2 Difference
There are some fundamental difference between the two forms of audit:
Scope:- in the case of an independent audit, the duties responsibilities, rights and liabilities so
the auditor are laid down under the respective statues. On the other hand, the extent of the work
to be undertaken by the internal auditor is mainly determined by the management the company.

Approach:- the internal auditor’s approach is with the view of ensuring that the accounting
system is efficient and effective so that accounting system (information) presented to the
management through the period is accurate and discloses material facts. The independent
auditors approach, however, is governed by his duty to satisfy himself that the accounts to be
presented to the share holders show a true and fair view of the profit or loss for the financial
period and of the state of the company’s at the end of that period.

Responsibility:- the responsibility of the internal auditor is towards the management where as,
the independent auditor is responsible directly to share holders. The external auditor is
responsible to financial statement users who rely on audit to add credibility to the statement.

Professional guidance:- For internal auditors is provided by the institute of internal auditors
(IIA). The IIA is an organization similar to the AICPA that establish ethical and practice
standards, provides education and encourages professionalism for its members.
Independence:- the independent auditor has get an independent status, while the internal auditor,
being and employee of the organization does not possess this independence of status.

2.6 Performance standards of internal auditing

2.6.1 Managing the internal audit activity
According to Ratlift (1988) the chief audit executive should effectively manage the internal audit
activity to ensure if adds value to the organization.
Planning:- the chief audit executive should establish risk based plans to determine the priorities
of the internal audit activity consistent with the organization’s goals.

The chief audit executive should consider accepting proposed consulting engagements based on
the potential to improve managements of risk, add value and improve the organization’s
operations. Those engagements that have been accepted should be included in the plan.
Resource management:- the chief audit executive should ensure that internal audit resources are
appropriate, sufficient and effectively employed to achieve the approved plan.

Reporting to the board and senior management:- the chief audit executive should report
periodically to the board and senior management on the internal audit activity’s purpose,
authority, responsibility and performance relative to its plan. Reporting should also include
significant risk exposures and control issues, corporate governance issues and other matters
needed or requested by the board and senior management.

2.6.2 Applicability of internal auditing

The development of internal auditing has major extent been centered in the business
organization. This ties continuous in the exacting literature of the profession and the convenient
of problems with work of business organization.

This ties however unduly deny the universal applicability of internal auditing to all type of
organization more over they fail to recognize that some of the most progressive internal auditing
is how being done by non business type organization a related fact also is that many organization
are blend of business and non business activities all of these development confirm that the need
for internal auditing exist in all type of organization when the completeness of activities, the
volume of transaction and dependence on large number of people to exist in some combination
to create operational problem

2.6.3 Quality of the internal audit personnel

In ascertaining the quality of the internal personnel, the independent auditor should enquire in to
(Shekahar, 2003):
 The qualifications and technical training of the internal audit personnel insome cases both
the internal auditors and the independent auditors belong to the same professional
organization and are subject to the same professional regulation except for independence.
 The clients practices for the recruitment and training of the internal audit personnel.
 The extent of supervision provided by the chief internal auditor, including the supervision
on planning, monitoring progress, assessing conclusions reached, reviewing reports and
following up to ensure that recommendations accepted are carried out.
 The standing of and regard for the abilities internal Auditors personnel in the client
organization.

2.6.4 Degree of independence of the internal auditors and the objectivity with
which the work is performed
The independent auditor should ensure himself that the internal auditor is in a position to
perform his work with a satisfactory degree of independence and objectivity. In assessing this the
independent auditor should satisfy him self that the internal auditors reports or has access to the
highest levels of management.

In such a case he is likely to be more objective than when he reports to lower lever of
management. The nature and extent of any constraints placed on the work of the internal auditor
by management should carefully be considered by the independent auditor. A review of the
findings and recommendations contained in the reports of the internal audit personnel will
usually be a useful factors in judging their independence and objectivity.
2.7 The nature of internal control
According to Boynton (1995) internal can be defined as the process through which an entity
attempts to minimize the likelihood of accounting related errors, irregularities, and illegal acts.
Internal control is a process, effected by and entity is board of director’s managements, and other
personal designed to provide reasonable assurance regarding the achievement of objectives in the
following categories:
 Reliability of financial reporting
 Compliance with applicable law and regulations
 Effectiveness and efficiency of operations

2.7.1 Importance of internal control

The importance of internal control to management and independent auditors has been recognized
in the professional literature of or many years. In 1947 publication by the AICPA entitled
internal control cited the following factors as contributing to the expanding recognition of the
significance of internal control.
 The scope and the sit of the business entity has become so complex and wide spread that
management must rely on numerous reports and analyses to effectively control
operations.
 The check and review inherent in good system of internal control afford protection
against human weaknesses and reduce the possibility that errors or irregularities will
occur.
 It is impracticable for auditors to make audits of most companies with in economic fee
limitation with out keying on the client’s system of internal control.

2.7.2 Objectives and related internal control relevant to an audit

As noted previously, management adopts internal controls to provide reasonable assurance of
achieving three categories of objectives
1. Reliability of financial information
2. compliance with applicable laws and regulations, and
3. effectiveness and efficiency of operations. Because not all of those objective
and related control are relevant to an audit of financial statements, one of the auditors first tasks
in meeting the second standard of field work is to identify those objective and controls that are
relevant, Generally, this includes those that pertain directly to the first category, reliability of
financial reporting. Thus, particular significance are controls that are intended to provide
reasonable assurance that financial statement prepared by management for external users are
fairly presented in conformity with generally accepted accounting principles.

Other objectives and related controls may also be relevant if they pertain to data the auditor uses
in applying audit procedures example includes objectives and related controls that pertain to:
 Non financial data used in analytical procedures such as the number of employees, volume
of goods manufactured, and other production and marketing statistics.
 Crtain financial data developed primarily for internal purposes such as budgets and
performance data used by auditor to obtain evidence about the amount reported in the
financial statements.
2.7.3 Reason for internal control evaluation
The primary reason for conducting an evaluating of a company’s internal control is to give the
auditors a basis for planning the audit and determining the nature, timing and extent of audit
procedures in the account balance audit program. The presumption is that the auditors have
prepared a preliminary audit program and have idea’s about the work they want to do.

2.7.4 Inherent limitations of internal control systems

According to Arens (1997) internal controls can never be regarded as completely effective,
regardless of the care followed in their design and implementation. Even if systems personnel
could design an ideal system, its effectiveness depends on the competency and dependability of
the people using it.

Because of these in beret limitations of controls and because auditors can not have more than
reasonable assurance of their effectiveness, there is almost always some level of control risk
greater than zero. There fore, even with the most effectively designed internal controls the
auditor must obtain auditor must obtain audit evidence beyond testing the controls for every
material financial statement account.

It is general accepted that internal control procedures can provides reasonable in no such case,
absolute assurance that the object of control relating to accounting system are achieved this could
be due to possible existence of cereation inherent limitation includes:
 Management’s consideration that a control be cost effective
 The fact that most controls tend to be directed at anticipated types of transaction and not
at unusual and unforeseeable.
 The potential for human error due to carelessness, distribution, errors of judgment and
misinterpretation of instruction .
 The possibility of circurrevention of control through collusion with parties out side the
entity or with employees of the entity.
 The possibility that person responsible for exercising control could abuse that
responsibility.
 Most of the control procedures are devised in relation to anticipated types of transactions
and hence may not be effective in relation to unusual or extraordinary transactions.
 Human errors due to errors to judgment or interpretation, misunderstanding, carelessness,
fatigue or distraction may undermine the effective operation of control procedures.

2.8 Evaluating internal control

There is to be a proper study and evaluation of the existing internal control as a basis for reliance
there and for determination of the resultant extent of the tests to which auditing procedures are to
be restricted. An auditor studies internal control to obtain:
 A knowledge and understanding of an entity’s prescribed procedure and methods.
 A reasonable degree of assurance that prescribed procedures and methods are in use and
operating as planned. In turn, an auditor evaluates the prescribed procedures and methods
and the degree of compliance.
An auditor’s an evaluation should relate to the existing system of internal control, not to controls
no longer applied or those contemplated for the future. Occasionally, employees may by pass
controls they believe are time-consuming or unnecessary.
In addition, some control may have been redesigned, but not yet implemented, an auditor must
be of control by pass and redesigned control in order to assure studying and evaluating control
which actually exist.
Under generally accepted auditing standards, the scope of study and evaluation of internal
control includes accounting control, but not administrative control.

CHAPTER THREE
METHODOLOGY
3.1 Study Area
This study would been conducted on Commercial Bank of Ethiopa Agaro Branch
3.2. Types of data and source
The researcher used both primary and secondary source of data to achieve the objective of the
study. The primary source of data were the actual collected data from individhals through
interview. The secondary sources of data were different documents and internal auditing practice
related reports of the bank.

3.3. Sampling method

The method of sampling the researchers use to obtain the data was non probability or judgmental
,i.e, convenience sampling to find the forget group of the study. This method was wed due to the
reason that it is, the most important technique to find convenent peoples that provide the
necessary data for the researchers. Because the researcher get fact, full, reliable information from
head quarter of the enterprise, financially manager, clients, and other experienced employees of
the Bank. It is also less costly and less time consuming.

3.4. Sample size

The popularization for this study includes all level of manager and employees working in
different department that organization to conduct the study sample of employees would be taken
as sample from the whole. The total number of worker within the organization 32 employees.
However the researchers select audit department. Thus, three internal auditors, sven of total
employees and the manager of the branch were used as the target group to gather the relevant
data.

3.5. Data collection method

The primary data were collected from primary source through interview. The interview were
conducted by the researcher to all internal auditors and the manager in order to find the important
information or data related to auditing practice. The secondary data were obtained from different
manual and other references that are related to internal auditing.

3.6 Methods of data analysis and presentation

Both primary and secondary data were collected and analyzed after it is edited. To analyze the
data collected the researchers use qualitative approach in which different factor or data collected
were described by word without any numerical measures.
Tabulati

consists of simply counting the number faces that fall in to varies categories. It communicates the
reult of the study, can be used for several propose.
 CHAPTER FOUR: TIME AND BUDGET BREAKDOWN
4.1. TIME SCHEDULE
No Activities Jan Feb Mar Ap May June July Aug
1 Proposal preparation


Finalizing and submission

2 of proposal 

3 Data collection 

Data organization and 

3 submission of first draft

4 Writing final draft 

5 Submitting final draft 

6 Defense 

4.2 Budget Break Down

No Stationeries Unit price Quantity Total price
birr cent Birr Cent

1 Paper - 1pac 1500 -

2 Pen 10 - 1pac 200 -

Other

1 Type write 5 - 35 page 105 -

2 Duplication 2 - 35page 70 -

Total 1,805.00

Bibliography
 Alvin A. Arens, 1997. auditing an interated appoabc, 7th edition, New jersey
(USA)
 Divid N Recchuite, 1982. Auditing concept and standard. University of Nottre
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 Kine Abraham Egziabher, 2002. Basics Mekelle University.
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