An Empirical Study on the Determinants of Internal Audit Outsourcing Decisions Among Large Enterprises

Abstract

The landscape of internal audit functions within large enterprises has undergone significant transformation over the past two decades, with outsourcing
emerging as a strategic consideration for organizations seeking to balance
control, expertise, and cost efficiency. While previous research has examined
internal audit outsourcing through primarily economic lenses, this study introduces a more comprehensive framework that integrates regulatory, technological, and strategic dimensions. The increasing complexity of regulatory
environments, particularly following the implementation of legislation such
as the Sarbanes-Oxley Act, has fundamentally altered the calculus behind
internal audit sourcing decisions. Simultaneously, the rapid advancement
of audit technologies and the emergence of new risk domains including cybersecurity and artificial intelligence governance have created both pressures
and opportunities that influence organizational approaches to internal audit
resourcing