Authors : Ebuka Emmanuel Ajaegbu

Volume/Issue : Volume 11 - 2026, Issue 9 - September

Google Scholar : https://tinyurl.com/mrxw7phj

DOI : https://doi.org/10.38124/ijisrt/26sep1387

Note : A published paper may take 4-5 working days from the publication date to appear in PlumX Metrics, Semantic Scholar, and ResearchGate.

Abstract : This study provides a preliminary empirical extension of Agency Theory by examining how information asymmetry, principal-agent conflict, agency costs, internal audit effectiveness, managerial accountability and board independence relate within a financial-sector governance context. Building on Ajaegbu and Mmayie’s (2025) conceptualization of internal audit as an agency-governance mechanism, the study distinguishes between the formation of agency problems and the governance mechanisms intended to constrain them. A cross-sectional survey generated 33 complete responses from professionals with experience relevant to internal audit, governance, control, finance, risk and management; 23 respondents reported currently working in Nigerian financial institutions. Multi-item constructs were assessed for internal consistency, while exploratory hypotheses were examined using correlation analysis, ordinary leastsquares regression, non-parametric bootstrapping and moderation analysis. The results identify a strong agency-problem pathway.

Keywords : Agency Theory; Internal Audit Effectiveness; Information Asymmetry; Agency Costs; Board Independence; Managerial Accountability.

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