The Effect of Internal Auditor Assurance and Consulting Roles on Blockchain Applications Related Internal Controls on User’s Perception of Information Quality: The Case of the Egyptian Customs Authority

Blockchain technology has resulted in drastic changes in business operations and is now being applied in different areas, such as government operations, financial operations, and supply chain management. Blockchain has its own advantages, such as offering tamper-proof audit evidence, decentralization, immutability, and accountability. However, it exposes businesses to different security risks. It is expected that external and internal auditors will respond to this disruptive technology by upgrading their technical skills and understanding of this technology. In addition, auditors will be requested to provide new consulting and assurance services related to this technology when they audit the companies’ financial statements.
The objective of this research is to investigate the impact of the consulting and assurance roles of internal auditors regarding blockchain-related internal
controls in the Egyptian Customs Authority (ECA hereafter) on the decision-maker's perception of information quality, completeness, confidentiality, timeliness, accuracy, validity, reliability, and security, in case the blockchain application is outsourced versus when it is developed in-house by the ECA. Using a two independent experiments, the researchers found that the internal auditor’s assurance / consulting role regarding blockchain related internal controls has a positive and significant effect on users’ perception of information quality. In addition, the positive effect of internal auditors’ assurance / consulting role on users’ perception of information quality is more pronounced when the blockchain application is developed in-house by the ECA than when it is developed and managed by an external party.
This research adds experimental evidence to prior literature investigating the added value of internal auditors’ assurance and consulting roles. The research results will be of interest to decision makers in the ECA and other public units trying to rely on blockchain technology in their operations. In addition, the results of the research will be of interest of academics, auditors, and policymakers.