Investigating Executive Barriers of Performance Management Auditing in Melli Bank Branches- Case study- Hormozgan Province

Transcription

1 Investigating Executive Barriers of Performance Management Auditing in Melli Bank Branches- Case study- Hormozgan Province Mehdi Avazzadeh Taziani* 1, Elyas Salari Raeiz 2 ** Department of Accounting, Bandar Abbas Branch, Islamic Azad University, Bandar Abbas, Iran Mehdi.avazzadeh@yahoo.com Abstract Performance management auditing and the services related to it are the tools created in the aim of helping to managers for better conducting and leading the banks in developed countries to help the managers in managing the bank by evaluating the effectiveness, efficiency, economic efficiency in banks and proposing practical recommendations including qualitative evaluation of tools available for management.this research tries to investigate the executive barriers of performance management auditing in Melli Bank branches of Hormozgan Province. Statistical population of this research constitutes of the managers of Bank Branches, Bank Inspectors, Financial Experts and training unit's experts in Hormozgan province which has been selected by random sampling method and the questionnaire is the method for collecting information. The findings show that: the presence of binding rules and provisions, banks managers' knowledge of the importance of executing performance management auditing, the presence of enough skills in auditors and inspectors of banks, the presence of suitable professional standards, accountability culture of banks' managers, the presence of enough scientific resources in relation to theory and practical methods for executing management auditing in banks are all effective and essential. Keywords: auditing, performance management auditing, effectiveness, efficiency, economic efficiency. * 1.Corresponding AuthorMehdi AvazzadehTaziani, Ma In Accounting Mehdi.avazzadeh@yahoo.com ** 2.Ma In Accounting Page 1987

2 1-1) Introduction: Management is defined as knowledge to apply resources effectively and efficiently to access to organization goals and these resources are usually included capital, work force and resources which are available to organization. A manager should organize and control organization operations for approaching to maximum benefits of planning. In today world the responsible and leading managers are always trying to gain necessary confidence from precise observation and objective evaluation on their tasks to remain powerful and dominant against ahead subjects and do their works exact and timely. Human unlimited requests and economic limited resources along with increasing economic improvement and competition resonation between economic units in different countries and in worldwide have been caused to increase the role of managers in managing mentioned units.moreover, the survival of banks and companies and other enterprises in economic environment of free market which is continually witness of trade barriers and merging market more than ever and competition is getting stronger day by day is not possible without enjoying from desirable level of effectiveness from accessing to goals, efficiency and economic efficiency and optimized management of resources. The managers in planning and controlling their under considered enterprises should regard to new and dynamic strategies for jumping and moving in success path and achieving to goals and in these changing and growing economic environments take effective steps for desirable use of current economic opportunities. Effectiveness, efficiency and economic efficiency are key and critical factors in success and prosperity in which ignoring them can follow collapsing and eliminating of economic unit. Financial accounting in dimensions of independent auditing and internal auditing of banks cannot lonely be a criterion for evaluating the performance of efficiency measurement and effectiveness of relevant managers. Increasing the importance of managers in banks, development and dynamism require auditing profession to investigate different dimensions of management in addition to investigate financial statements and comment on the frame of principles and criteria of financial auditing. So, it is necessary that auditors and inspectors in banks in addition to use from specialists services in different fields evaluate the quality of management decision- makings and represent their conclusions and corrective recommendations to improve management more and more. Hence, in the recent years, most valid auditing institutions in the world have broken their organizations up to financial auditing measurement and management auditing. Performance management auditing and the services related to it are the tools created in the aim of helping to managers for better conducting and leading the banks in developed countries to help the managers in managing the bank by evaluating the effectiveness, efficiency, economic efficiency in banks and proposing practical recommendations including qualitative evaluation of tools available for management. 3 Performance management auditing in both sectors of public and private banks can be a useful tool for identifying defects, preventing from resources wastes, increasing computational power and representing better services. Since, at the moment, many Iranian banks are done as financial auditing, our all trying and attempting is examining execution of performance management auditing including auditing the efficiency and observing the economic efficiency and auditing the effectiveness. Hence, the 3 Ibid p Page 1988

3 current research focus on the examination of executive barriers of performance management auditing in Melli banks in one of largest and most important economic pole of our country's south provinces_ Hormozgan Province_ in which we hope that the goals and suggestions of this research be as a tool for helping and assisting the managers of banks, financial experts and auditors and inspectors of banks existing in this province to access to the goals of efficiency, effectiveness and economic efficiency. It is hoped that the results of this research can be guidance to evaluate the efficiency of banks' management and banks' auditors and inspectors and a help to future researches in other provinces of our country. 2-1) statement of the problem and causes for selecting research topic: In theory, banks should act effectively, efficiently and economic efficiently. Performance auditing provides an objective and impartially analyzing, so that, the persons who are operator of employing public resources can use performance auditing information to improve operations, plans performance and decrease cost and cause to facilitate individuals' decision- makings who are responsible for supervision and doing corrective measures and help to public accountabilityresponsibility. Among Iranian banks, the management of major part of economic resources is on Melli Bank and the quality of this management has basic effects on the fate of nation. The managers of banks should be accountable against people and their agents and should provide the tool of this accountability based on valid information. The nature of Melli Bank requires that in the sector of performance management auditing in addition to investigating the financial statements and commenting on principles and criteria framework the financial auditing should be also required. Hence, it is necessary for auditors and inspectors of banks meanwhile using from specialists' services in different fields to evaluate the quality of management decision- makings and represent their corrective results and suggestions to improve the management more and more. Regarding to the importance of improvement in promoting the management in banks, especially in Melli Bank, it is necessary that the managers try to establish comprehensive systems of quality control of management and review them in terms of continues evaluation of efficiency, economic efficiency and effectiveness. In this line the auditors and inspectors of banks like the financial auditors can play a major and valuable role in improving and promoting these systems; consequently, desirable accountability of banks occurs when, by planning, the performance of entities is investigated based on stating the goals obviously and expected results, thus the performance management auditing is an obvious statement of observing economic efficiency, efficiency and effectiveness in performance of all big and small banks. The benefits of executing the performance management auditing in banks are as follows: - Determining the existing problems and defects in banks operations, relevant reasons and improvement solutions. - Determining the opportunities for increasing efficiency and decreasing costs. - Determining the opportunities for increasing revenues and interests (or other resulted benefits) - Cooperating in codifying the goals, strategies and methods of banks if not exist as codified one. - Determining necessary criteria to measure the rate of achievement to expected results, if there has been not desirable criteria for measurement. Page 1989

4 - Helping in the fields of improving strategies, methods and the structure of banks - Creating control for improving the performance of sectors and units of banks - Trusting to observation of rules, goals and strategies of banks - Discovering unauthorized operation with fraud and unusual activitiesin banks - Improving management information systems and controlling them - Recognizing potential abilities of system in its future operation - Correcting the communications among operational and high- level management managers - Providing an independent and objective assessment from operation In summary,performance management auditing based on its assigned missions is following better ways for doing different operation in banks which is caused to promote productivity. Performance auditing has three components_ efficiency, effectiveness and economic efficiency_ which enjoys from much importance; nowadays, evaluation of efficiency, effectiveness and economic efficiency should be a part of common process of public and private banks' management and the managers should take to account the investigation of performance as one of their responsibilities for controlling the activities and independent evaluation of managers' performance should be done via internal auditing unit or independent auditors. Since the auditors and inspectors of banks do their audits based on financial auditing and identifying the performance management should be done based on performance auditing, they are faced with some challenges as follows: Some problems such as: lack of necessary rules and provisions in execution; lack of training fundamental plans, the presence of an inappropriate bank, financial and unaccountable system; unfamiliarity of public banks' managers with performance auditing and its benefits. 3-1) the importance and necessity of research: "Performance management auditing" is of relatively new discussions in auditing affairs which has took auditing scope beyond financial auditing and increased the subject of investigation, scope of commenting and auditing recommendations, considerably. Some causes for the necessity of consideration to performance auditing are as follows: - Financial auditing in terms of investigation scope cannot completely be accountable for auditing needs. - In democratic governments, people and their agents need to appropriate mechanisms and methods to be aware from banks authorities and other scope of audits are not accountable to their needs. - Considering to increasing expansion of awareness and competition in different areas, the sensitivity of public has been considerably increased than gaining productivity and efficiency. Nowadays, as an example, even in a relatively small country, 1% increment in productivity causes to major changes in per capita income, gross domestic product, competitiveness power in market and which is most important in terms of promoting economic and social position of that country. - The banks that consider to their performance based on complete criteria such as economic efficiency, efficiency and effectiveness disposable to others' judgment and measurement and the managers of those banks consider to their survival of managing under the shadow of Page 1990

5 people and relevant stockholders do more efficient than the banks where there is any performance analyzing. Maybe, the most important difference between public and private banks is this fact that the managers of private banks should be always accountable,because of their performance, to stockholders and if the stockholders show any weakness from them may change their comment on them. If by creating similar mechanisms in public banks, we try to create this extent of accountability and the managers of public banks know that their personal benefits (managerial survival and ) are associate and in line with bank benefits it is expected from public banks to act efficient as much as private banks. Performance auditing is a major step in this direction. Keywords Auditing: Is a regular and systematic process to collect and evaluate impartially the witnesses on statements related to activities and economic events in order to determine the level of compatibility of these statements with predetermined criteria and report the results to beneficiary individuals (statement of auditing fundamental concepts; publication No. 121; Auditing Organization). Performance management auditing: Performance auditing is investigating and auditing of one issue or services about observing the economic efficiency, efficiency and effectiveness criteria. Efficiency Efficiency means ensuring from gaining maximum results from assigned resources for one sector (or program) or consuming minimum resources for acquiring special level of results (specialized committee of performance management auditing, 1996, 15). Effectiveness Effectiveness means ensuring from compatibility of results due to any activity with expected results (specialized committee of performance management auditing, 1996, 15). Economic efficiency Based on auditing standards of International Organization of Superior Auditing Institutes (INTOSAI),the economic efficiency means minimizing the cost of used resources in one activity considering to appropriate quality. Analyzing 4-2-2) Examining the Results and Analyzing the Hypotheses of Research In this research, parametric one sample t-test has been used which, for executing, requires establishment of normality hypothesis for the all six dimensions of considered questionnaire. Among the methods that can be used for finding the normality of observations are Shapiro- Wilk and Kolmogorov- Smirnov tests that in this researchkolmogorov- Smirnov test has been used and the its results are as follows: In examining the normality, observations of hypotheses are as follows: Null hypothesis (H0): the observations follow up normal distribution. First hypothesis (H1): the observations don t follow up normal distribution. Page 1991

6 Table (4-6): The results of Kolmogorov- Smirnov for examining the normality of 6 variables observations 1st index 2nd index 3rd index 4th index 5th index 6th index The number of observations Normal distribution Average parameter Standard deviation Most Pure value extreme Positive value differences Negative value Kolmogorov- Smirnov Z Asymp. Sig. (2- tailed) In the aforesaid table the results of Kolmogorov- Smirnov for examining the normality of 6 variables are shown as follows: 1- the presence of binding rules and provisions for executing performance management auditing in banks 2- Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals 3- The presence of enough skills in auditors and inspectors of banks in executing performance management auditing 4- The presence of suitable professional standards in executing performance management auditing 5- Accountability culture of banks' managers in executing performance management auditing 6- the presence of enough scientific resources in relation to theory and practical methods for executing management auditing and as can be seen the level of significance for all variables are more than 0.05 (sig. > 0.05), in that, the Kolmogorov- Smirnov test is not significant; therefore, the null hypothesis cannot be rejected. So, all variables of this study follow up normal distribution and can use from parametric one- sample t- test for examining the hypotheses of research ) Analyzes and results of 1 st hypothesis: 1 st hypothesis of research: the presence of binding rules and provisions for executing performance management auditing in banks is essential. Null hypothesis (H0):the presence of binding rules and provisions for executing performance management auditing in banks isnot essential. Alternative hypothesis (H1):the presence of binding rules and provisions for executing performance management auditing in banks is essential. Page 1992

7 1 to 4 questions of questionnaire constitute the variable of "the presence of binding rules and provisions" and any questions allocated one of 1-5 Likert scores. For analyzing the aforesaid hypothesis, first total scores of each respondents is calculated based on these 4 questions and frequency distribution and percentage of acquired scores categorized in 5 categories (very low to very much) and finally analyzed the research hypothesis using from one sample t- test in which its hypothesized amount_ minimum, medium and maximum of total scores (5-20) _ is 12. Table (4-7): frequency distribution of 1 st variable low Low Medium Much Distribution much Total Frequency Percentage Collective percentage High percentage of respondents, means 50.8% of them in "much" to "very much" category and 44.1% in medium category and 5.1% in low category, believe that the presence of binding rules and provisions for executing performance management auditing in banks is essential. Table (4-8). The results for the dimension of the presence of binding rules and provisions for executing performance management auditing in banks by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation In aforesaid table the results of one- sample t- test has been represented to examine this hypothesis in which the results show that the comments average of 195 statistical samples are equal to 13.5 and the standard deviation equal to 1.86 and statistically there is a significant difference with the hypothesized average of 12 (p < 0.005) and this significant difference shows that in viewpoint of respondents of this study the presence of binding rules and provisions for executing performance management auditing in banks is highly essential. So, this hypothesis is supported in confidence level of 95% ) Analyzes and results of 2 nd hypothesis: 2 nd hypothesis: Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective. Null hypothesis (H0): Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is not effective. Alternative hypothesis (H2): Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is not effective. 5 to 8 questions of questionnaire constitute the variable of "Banks managers' knowledge of the importance of executing performance management auditing" and any questions allocated one of 1-5 Likert scores. And the total acquired scores of these 4 questions vary from 5 to Page 1993

8 Frequency distribution of respondents in terms of total scores and the results of one sample t- test for examining the hypothesis as follows: Table (4-9): frequency distribution of 2 nd variable Low Medium Much Distribution low much Total Frequency Percentage 0 1/ Collective percentage 0 4/ According to cumulative percentage distribution of aforesaid table, 4.1% of respondents are in "low" category, 25.1% of them are in medium category and most of them mean 70.8% of respondents believe that Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective. Table (4-10): Banks managers' knowledge of the importance of executing performance management auditing by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation In addition to frequency distribution table the results of one- sample t- test has been represented in aforesaid table in which the results show that the comments average of 195 statistical samples are equal to 14.2 and the standard deviation equal to 1.53 and statistically this average is significantly more than the hypothesized average of 12 (p < 0.005) and thus it is concluded that in viewpoint of respondents of this study Banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective. In that, this hypothesis is supported in confidence level of 95% ) Analyzes and results of 3 rd hypothesis: 3 rd hypothesis: The presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. Null hypothesis (H0):The presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. Alternative hypothesis (H3):The presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. 9 to 12 questions of questionnaire measure the variable of "the presence of enough skills in auditors and inspectors of banks" which similar to any questions allocated one of 1-5 Likert scores. And the total acquired scores of these 4 questions vary from 5 to 20. Frequency distribution of respondents in terms of total scores and the results of one sample t- test for examining the hypothesis as follows: Page 1994

9 Table (4-11): frequency distribution of 3 rd variable Low Medium Much Distribution low much Total Frequency Percentage Collective percentage According to cumulative percentage distribution of aforesaid table, 1% of respondents are in "low" category, 12.3% of them are in medium category and most of them mean 86.7% of respondents believe that the presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. Table (4-12): the presence of enough skills in auditors and inspectors of banks by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation Also according to the results of one- sample t- test the scores average of 195 statistical samples are equal to 15.7 and the standard deviation equal to 2.1 and statistically this average is significantly more than the hypothesized average of 12 (p < 0.005) and thus it is concluded thatthe presence of enough skills in auditors and inspectors of banks in executing performance management auditingis effective. In that, this hypothesis is supported in confidence level of 95% ) Analyzes and results of 4 th hypothesis: 4 th hypothesis: the presence of suitable professional standards in executing performance management auditing is effective. Null hypothesis (H0): the presence of suitable professional standards in executing performance management auditing is not effective. Alternative hypothesis (H4):the presence of suitable professional standards in executing performance management auditing is effective. 13 to 16 questions of questionnaire measure the variable of "the presence of suitable professional standards" which similar to any questions allocated one of 1-5 Likert scores. For analyzing the above mentioned hypothesis like other hypotheses first total scores of each respondents is calculated based on these 4 questions and frequency distribution and percentage of acquired scores categorized in 5 categories (very low to very much) and finally the results of frequency distribution table and statistical tests by usin from one sample t- test considering to the hypothesized amount of 12 as the average of total scores (5-20 numbers) are as follows: Page 1995

10 Table (4-13): frequency distribution of 4 th variable Low Medium Much Distribution low much Total Frequency Percentage Collective percentage Among 195 statistical samples of this research the number of 20 samples (10.3%) is in medium category and most of them mean 89.7% of respondents believe that the presence of suitable professional standards in executing performance management auditing is effective. Table (4-14): the presence of enough skill in auditors and inspectors of banks by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation The aforesaid table show the results of one- sample t- test to examine 4 th variable; it is seen that the observations for 195 samples are equal to 16.2 and the standard deviation equal to 1.9 which is significantly more than the hypothesized average of 12 (p < 0.005) and thus it is concluded that the presence of suitable professional standards in executing performance management auditing is effective. In that, this hypothesis is supported in confidence level of 95% ) Analyzes and results of 5 th hypothesis: 5 th hypothesis: Accountability culture of banks' managers in executing performance management auditing is effective. Null hypothesis (H0): Accountability culture of banks' managers in executing performance management auditing is not effective. Alternative hypothesis (H5): Accountability culture of banks' managers in executing performance management auditing is effective. 17 to 20 questions of questionnaire measure the variable of "accountability culture of banks' managers" which similar to any other questions allocated one of 1-5 Likert scores. In which the results of frequency distribution table and statistical tests by using from one sample t- test considering to the hypothesized amount of 12 as the average of total scores (5-20 numbers) are as follows: Table (4-15): frequency distribution of 5 th variable Low Medium Much Distribution low much Total Frequency Percentage Collective percentage Page 1996

11 1.5% of respondents in low category, 24.1% in much and very much category believe that Accountability culture of banks' managers in executing performance management auditing is effective Table (4-16): Accountability culture of banks' managers by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation The aforesaid table show the results of one- sample t- test to examine 5 th variable; it is seen that the observations for 195 samples are equal to 14.6 and the standard deviation equal to 3.9 which is significantly more than the hypothesized average of 12 (p <0.005) and thus it is concluded accountability culture of banks' managers in executing performance management auditing is effective. In that, this hypothesis is supported in confidence level of 95% ) Analyzes and results of 6 th hypothesis: 6 th hypothesis: The presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective. Null hypothesis (H0):the presence of scientific resources in relation to theory and practical methods for executing management auditing is not effective. Alternative hypothesis (H5):The presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective. 21 to 24 questions of questionnaire measure the variable of "suitable scientific resources" which similar to any other questions allocated one of 1-5 Likert scores. In which the results of frequency distribution table and statistical tests by using from one sample t- test considering to the hypothesized amount of 12 as the average of total scores (5-20 numbers) are as follows: Table (4-17): frequency distribution of 6 th variable Low Medium Much Distribution low much Total Frequency Percentage Collective percentage In the aforesaid table it can be seen that 3.6% of respondents in low and very low category, 21% in mediumone and 74.4% in much and very much category believe that the presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective. Page 1997

12 Table (4-18): the presence of enough scientific resources in relation to theory and practical methods for executing management auditing by one sample t- test Hypothesized average: 12 Average Standard t- value Freedom level p- value deviation Regarding to the results of one- sample t- test, it can be seen that the average comments of respondents in dimension of "the presence of enough scientific resources in relation to theory and practical methods for executing management auditing in banks" are equal to 14.5 and the standard deviation equal to 2.1 which is significantly more than the hypothesized average of 12 (p < 0.005) and thus it is concluded that in viewpoint of respondents the presence of enough scientific resources in relation to theory and practical methods for executing management auditing in banks is effective. In that, this hypothesis is supported in confidence level of 95%. Table (4-19): the summary of results due to statistical tests of hypotheses Hypothesis % of much and very much Confidence Hypothesized average=12 No. options level % % % % % % % % % % % % Conclusion 5-2) findings resulted from the research In a general conclusion, it can be stated that in a global economy the competition among banks become more complex and compact than to past and in the meantime approaching to efficient and effectiveness operation is the major responsibility of management and operation and control of management should be designed in the entire bank structure and bank management in line with this goal. Performance management auditing meanwhile promoting positive aspects of management caused to solve the problems, overcome to the problems, and improve the quality of managing bank units; now the question is that "considering to the importance of performance management auditing role in banks, is its rapid execution essential and effective?" this research aimed to find an answer to the mentioned question. So, 6 hypotheses have been designed. 1 st hypothesis: 1 st hypothesis in this research tries to find out "whether the presence of binding rules and provisions for executing performance management auditing in banks is essential". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the presence of binding rules and provisions for executing performance management auditing in banks is essential Page 1998

13 2 nd hypothesis: 2 nd hypothesis in this research tries to find out "whether the banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective. 3 rd hypothesis: 3 rd hypothesis in this research tries to find out "whether the presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. 4 th hypothesis: 4 th hypothesis in this research tries to find out "whether the presence of suitable professional standards in executing performance management auditing is effective". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the presence of suitable professional standards in executing performance management auditing is effective. 5 th hypothesis: 5 th hypothesis in this research tries to find out "whether the accountability culture of banks' managers in executing performance management auditing is effective". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the accountability culture of banks' managers in executing performance management auditing is effective. 6 th hypothesis: 6 th hypothesis in this research tries to find out "whether the presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective". The findings resulted from done measurement and evaluation show that the aforesaid hypothesis has been supported in confidence level of 95%. So, the presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective. 5-3) Research Recommendations In this part of research, researcher recommendations in relation to the subject of research which is resulted from analyzing and evaluating the results of hypotheses of research have been represented in two sections: 1- Recommendations based on research results; 2) recommendations for doing future researches to future researchers. Page 1999

14 5-3-1) Recommendations based on research results come from research hypotheses: The recommendations resulted from research findings are as follows: 1- the findings resulted from 1 st hypothesis show that the presence of binding rules and provisions for executing performance management auditing in banks is essential. Consequently, it is recommended that central bank by taking help from professional auditing institutes such as Supreme Audit Court and Audit Organization tries to enact new rules and provision for executing performance management auditing in banks and evaluating performance management in line with increasing the efficiency, effectiveness and economic efficiency. 2- The findings resulted from 2 nd hypothesis show that the banks managers' knowledge of the importance of executing performance management auditing in line with bank goals is effective. Consequently it is recommended that the central bank by issuing relevant circulars and by- laws require the managers of banks to respond to banks' auditors and inspectors and also by taking help from scientific centers such as Supreme Audit Court and Audit Organization, Charted Accountants Association and even Universities via holding different scientific meetings and conferences tries to introduce the performance management auditing in banks more and more and states its advantages to the managers. 3- The findings resulted from 3 rd hypothesis show that the presence of enough skills in auditors and inspectors of banks in executing performance management auditing is effective. Consequently it is recommended that the central bank and auditing organization hold some specialized courses in order to increase the specialty and skills of auditors and inspectors of banks and creating some fields to recognize the methods of performance management auditing and recruitment the specialist forces in this field and forcing them to train in the mentioned courses for different professional positions. 4- The findings resulted from 4 th hypothesis show that the presence of suitable professional standards in executing performance management auditing is effective. Consequently it is recommended that the legislature should oblige the central bank to performance management auditing in banks by enacting binding rules and also the Supreme Audit Court and Audit Organization should codify rapidly the standards of performance management auditing in banks. 5- The findings resulted from 5 th hypothesis show that the accountability culture of banks' managers in executing performance management auditing is effective. Consequently, it is recommended that the central bank should oblige banks to be accountable against executing plans, activities, designs, and realizing determined goals and report to people and their legal agents and this affaire requires a public culture for accountability and all forces should help together to create accountability culture among the managers of banks. 6- The findings resulted from 6 th hypothesis show that the presence of enough scientific resources in relation to theory and practical methods for executing management auditing is effective. Consequently, it is recommended that adapting necessary measures from universities and professional individuals to include the concepts and principles of performance management auditing in banks and academic materials of management and banking field in the level of graduate and under graduate courses to induce a better understanding of this type of auditing before beginning to work. Page 2000

15 5-3-2) Second recommendations 1- The results of research show that people are not enough aware from their rights and in fact they are not,پاسخخواه which this affair caused to lack of accountability of the managers of banks, so, it is recommended that a procedure is adopted in the central bank to make mangers accountable against people. 2- Selecting appropriate methods for awareness and increasing insight and knowledge level of employees on suitable effects of executing performance management auditing in banks to increase the efficiency, economic efficiency and effectiveness. 3- Encouraging and or forcing the stockholders or their agents in private banks to real and precise auditing and analyzing the activities of banks' managers via bank board of directors. 4- Auditors and inspectors of banks for executing performance management auditing in banks should have enough educations and experiences in doing evaluation and research affairs 5-3-3) Recommendations for future researches The findings of research provide some witnesses for future researches framework. So it is recommended that the following subjects will considered by researches in future: 1- Investigating the rate of performance management auditing's effects on productivity of public and private banks 2- Identifying the basic challenges of central bank for desirable executingthe performance management auditing in banks. Page 2001

16 References 1- Azar, Adel; Momeni, Mansour, (2001), "statistics and its application in management", 2 nd edition, Tehran, Samt publication 2- Eslami Bigdeli, Gholamreza; Zareei, Batool, (2002), "criteria in performance auditing", auditing knowledge quarterly magazine, No Bani Fatemi, M. Reza (2003), "being familiar with some concepts of performance auditing (efficiency, effectiveness and economic efficiency)", auditor, No HassasYeganeh, Yahya, (2003), "operational auditing challenges", set of researches of internal auditing conference, commercial ministry 5- Hosseini Araghi, Seyed Hossein; Aghaloo, Yahya (1998), 4 th edition, Tehran, economic affairs of faculty publications 6- Rahnomoud, Intosay (2011), auditing knowledge quarterly magazine, No Darvishi, Soheil (2012), examining the effect of executing the performance management auditing in private banks (case study: Karafarin Bank), masters' degree thesis of Islamic Azad University, Tehran Markaz Branch 8- Shabahang, Reza (2006), "performance management auditing", Tehran, specialized research center publication, accounting and auditing 9- Orfi, H. Reza (2005), "auditing", 2 nd edition, Tehran, Parsed non- governmental higher education institute. 10- Favchi, Hadi (2011), "guidelines for executing the standards of performance auditing", training and improving center of human resources, Superior Audit Court of Iran. 11- Favchi, Hadi (2010), "speeches in performance auditing conference in Superior Audit Court specific to superior audit court auditors" 12- Molaei, Omid; (2011), "investigating the rate of performance management auditing's effects in increasing the efficiency of the managers of Isfahan Province banks", Master's degree thesis, Islamic Azad University, Isfahan Branch 13- Daliri, M. Mahdi (2012), " performance management auditing and its effects on productivity and performance of banks' managers", Master's degree thesis, Islamic Azad University, Yazd Branch 14- Rasoulov, Jalal (2011), "localization of performance management auditing system in bank system of Iran", Keshavarzi Bank, Modern Banking quarterly magazine, No Mahmoudi, Alireza (2011). Examining the execution of performance management auditing and its effects on productivity of banks, case study: Saderat Bank. masters' degree thesis of Islamic Azad University, Tehran Markaz Branch 16- The set of researches and speeches of performance auditing conference, accountability and promoting the productivity (2009), Superior Audit Court of Iran. 17- Mohimani, Mohammad; Abdollahpoor, Mohammad (2001), "comprehensive guide of operational auditing", Tehran, Auditing Organization Publication, Publication No Nokhbeh Fallah, Afshin (2011), Examining the barriers and defects in executing the performance management auditing in National Petrochemical Company and subsidiary companies, masters' degree thesis of Islamic Azad University, Tehran Markaz Branch Page 2002

17 19- American Institute of Certified Public Accountants "operational audit engagements" New York, Armstrong. Michael. The performance management audit, 2010, p David s. Kawalczky, "operational auditing", The Wiley Institute of Internal Auditors, 2009, p DALE FLESHE, STEWART. Independent Auditors Guide to operation 23- David S.K Owalezyk, "operational audit", John Wiley & Sons, Ellsworth H. Morse. "performance and operational auditing" 25- H. Smi? Charles et. al. ((The need for very attitudes)). The accounting review? April Leo? Hebert. Auditing the performance of management, Ronald Brown, "operational Audit", lasterwitte report, no. 4, Page 2003