Business Process Automation: Internal Audit Function Adaptation Lesson Learned from Indonesian Public Sector

The purpose of this study is to analyze the transformation of the Inspectorate General (ITJEN) at the Ministry of Finance as an impact of the Directorate General’s (DGT) Taxation System Information (SIDJP) implementation. This study uses a case study and a qualitative approach with institutional theory to study the problem. Data collection is performed via documentation and interviews with key informants from the Institute of Internal Auditors (IIA), the DGT of Taxation, the Indonesian Supreme Audit Institution, the State Development Audit Agency, and the Auditor of Inspectorate General of Ministry of Finance. This study shows that the implementation of SIDJP engendered adaptation of ITJEN’s scope and practice, structure, auditor skill requirements, audit tools, audit sizes, and relationship with information technology departments, whereas the audit source and its relationship with the external auditor remained the same. Keywords—Internal audit, system information, institutional theory, institutional logic, Business Process Automation, Indonesian Public Sector.