Audit Committee and Enterprise Risk Management Effectiveness in Tanzania Social Security Funds

Abstract

This study examines the degree to which audit committee (AC) contributes to Enterprise Risk Management (ERM) effectiveness in Tanzania ' s social security funds. Using Ordinary Least Square (OLS) estimation technique, 193 cross-section observations on AC characteristics, AC ERM specific oversight processes and management support to AC variables were regressed against ERM effectiveness. Results show that each of the three explanatory variables has a significant positive effect on ERM effectiveness with AC oversight specific processes ranking first followed by AC characteristics and management support to AC respectively. Generally, the results lead to a conclusion that audit committee characteristics, ERM specific oversight processes and management support to AC considered collectively enable audit committees to contribute significantly towards ERM effectiveness. Policymakers, audit committees and/or boards, practitioners and managers may use the findings of this study to inform their strategies aimed at improving ERM effectiveness and consequently achieving their organisations ' predetermined objectives.

Keywords: Audit committee, Enterprise risk management, Social Security Funds, Tanzania