Volume 6, Issue 3, March – 2021 International Journal of Innovative Science and Research Technology

ISSN No:-2456-2165

Internal Auditing Paradigm Shift: From Traditional

Audits to Audits in the 4.0 Industry Era
Michael Adidharma Mervelito1, Baihaqi Arsyad Lintang2, Ahmad Adri3
1,2,3
Accounting Study Program in Faculty of Economic and Business, Perbanas Institute, Jakarta, Indonesia

Abstract:- In the Era of Industry 4.0, which is digital- services[5]. Many countries have implemented Industry 4.0 to
based and the rapid development of technology like now, advance their manufacturing industries, and then, they can
it has changed the paradigm or way of seeing someone in position themselves to compete in the future[6]. Industry 4.0
the implementation of internal audit for organizations. is digital-based, and the rapid development of technology has
This empirical study aims to analyze the shift in the changed the paradigm or way of seeing a person in obtaining
paradigm of a traditional internal audit into an internal information, including in the world of business accounting[1].
audit in the era of Industry 4.0 in providing added value According to Rosmida[1], this change has immediately
to the organization. This research is an empirical study responded as a challenge for the internal audit
using a quantitative approach. The sampling technique implementation in a company.
used purposive sampling method, and the data analysis
technique used was Structural Equation Modeling. The The paradigm theory made by Thomas Khun[7],[8]
data processed with the smartPLS application software. states that one of the characteristics of the paradigm's
The study results reveal that internal audit in the substance is that it offers certain new elements that draw
Industrial Era 4.0 positively and significantly mediates followers out of the competition that draw followers out of
the effect of a traditional internal audit on organizational the competition for work methods in previous scientific
value-added. Also, internal audit in the Industrial Era 4.0 activities. In the application of the internal audit method,
to moderate potentially the relation between a traditional there is a paradigm shift from a traditional paradigm to an
internal audit on organizational value-added. Hopefully, internal audit paradigm that provides added value[9]. A shift
this research can contribute to internal audit studies in the internal audit paradigm will occur from a traditional
related to the shift in the traditional internal audit internal audit perspective towards industry internal audit 4.0
paradigm into Era 4.0 internal audit in providing added [10] so that it has expected to provide added value to the
value to organizations. organization or company.

Keywords:- Traditional Internal Audit, Industrial Era 4.0, There have been several previous studies related to this
Paradigm Shift, Value-Added Organization. internal audit. Previous research by Yuliatma’s study[9] that
discusses a shift in the traditional internal audit paradigm that
I. INTRODUCTION provides added value. Dai & Vasarhelyi[11] stated in their
research that there are effects and use of technology that
Accountants as a profession developed over the includes Industry 4.0 in the audit process, as well as the
centuries and has experienced ups and downs in maintaining impact of its broad application in business. In study from
their existence[1]. Internal audit is a consulting activity that is Shahimi et al.,[12], internal auditor services provide added
managed independently and objectively, which is designed to value in consulting at the request of management, helping to
add value to improve the company's operational activities[2]. improve business operations and to achieve organizational
According to Dewi Yuniarti Rozali & Alfian[3], internal goals. Rosmida's research[1] examines the role and
auditors have an important role in a company, because the challenges of accountants in the era of the Industrial
role of internal auditors affects the possibility of errors, revolution 4.0 towards the Era of Society 5.0.
inaccuracies, or fraud in the company. Besides that, internal
auditors in carrying out their audit activities are required to be The purpose of this research is to empirically analyze
able to provide added value to the organization and its the shift in the paradigm from traditional internal audit to
stakeholders[4]. Furthermore, Rosmida[1] states that an internal audit in the era of 4.0 for improving the
accountant must care about the development of industry 4.0 organization's added-value. The focus to be achieved in this
by looking at the opportunities that exist. The inability to research:
adapt to changes causes the company to experience a loss of (1) to examine whether the traditional internal audit has
competitiveness. affected Internal audit in The Era 4.0 industry
(2) to examine whether Internal audit in The Era 4.0 industry
The Industry 4.0 concept is the new reality of the has affected on the organization's added-value.
modern economy, as innovation and technological (3) to examine whether the traditional internal audit has
development play a significant role in every organization. affected on the organization's added-value
Industry 4.0 significantly changes products and production (4) to identify whether Internal audit in The Era 4.0 industry
systems related to design, processes, operations, and has a role in mediating the traditional internal audit for

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Corporate Performance (ROA) the organization's added- (3) Scope
value, The scope of work is the scope of work of the internal
(5) to identify whether Internal audit in The Era 4.0 industry examiner, which must include testing and evaluation of the
has a role in moderating the traditional internal audit for adequacy and effectiveness of the organization's internal
Corporate Performance (ROA) the organization's added- control system and the quality of the implementation of the
value, responsibilities given.

As a result, the contribution of this research can provide (4) Implementation of Internal Audit
insight and understanding for internal auditors in carrying out Execution of inspection activities is an inspection/audit
auditing, especially for large companies in the industrial era activity that includes planning the inspection, testing and
4.0. This research model using mediating and moderating evaluating the information on notification of results, and
variables that developed is the novelty of this study. following up.

II. LITERATURE REVIEW In this study, the definition of a traditional internal audit
is an independent and professional assessment activity and
A. Internal Audit Concept function to carry out an audit within the scope designed to
Internal audit is a consulting activity that is managed provide added value to the organization. (IIA, 2009; Adhisty
independently and objectively, which is designed to add value & Priantinah, 2012; Widilestariningtyas, 2014).
to improve the company's operational activities[2]. The
purpose of an internal audit is to help members of the B. Industrial Era 4.0
organization carry out their responsibilities effectively. The The Industry 4.0 era, also called 'Industry 4.0, became
Institute of Internal Auditors (IIA) defines internal audit as: public recognition at the Hannover Fair in 2011[17]. It
[...] an independent, objective assurance and consulting introduces State-Of-The-Art technologies, such as the
activity designed to add value and improve an organization’s Internet of Things, Internet of Service, Cyber-Physical
operations[13]. It helps an organization accomplish its Systems, and Smart Factories, into the manufacturing
objectives by bringing a systematic, disciplined approach to environment, enabling fundamental improvements to
evaluate and improve the effectiveness of risk management, industrial manufacturing processes, engineering, materials
control and governance processes[14]. According to used, and the supply chain and management life cycle[18].
Widilestariningtyas et al., [15] stated that internal audit is an Industrial era 4.0 has empowered manufacturing digitization
independent assessment function in an organization which the in the supply network that involves information integration
objective of examining and evaluating the activities of the from various sources and locations to drive physical
organization carried out. Internal audit professional practice manufacturing and distribution operations[19].
norms are also professional standards that should indicate a
traditional internal audit practice. According to Hiro Tugiman Industry 4.0's goal is to increase the flexibility of the
[16], these indications are: existing value chains by maximizing the transparency of
incoming and outgoing logistics and all other business
(1) Independence functions, include accounting, legislation, human resources,
Independence is an indication that an internal audit must etc. Audit 4.0 will take advantage of technology promoted by
be independent and separate from the activities it examines. Industry 4.0, especially the Internet of Things (IoT), Internet
of Service (IoS), Cyber-Physical Systems (CPSs), and smart
(2) Professional ability industry to collect financial and operational information, as
Professional ability is that internal audit must reflect well as audit-related data from the organization and related
professional expertise and thoroughness. parties, technically there is a difference between the
traditional internal audit and the simplified Industrial Age 4.0
internal audit. Shown as in Table 1.

Traditional Internal Audit

Internal Audit in Industry Era 4.0
- Manual still audit equipment: pencil and calculator - Inclusion of Big Data in Analytic tools with Analytical
- Audit equipment has improved using Information Technology: Applications
Ms. Excel, CAAT Software. - Semi-progressive and automation audit equipment:
Sensors, CPS, IoT / IoS, RFID, and GPS
Table 1: -Internal Audit Era

In this study, Internal Audit Era 4.0 is an internal audit C. Organization's Added-Value
activity that follows standards, principles, technology, and At present, managing an internal audit must have a
auditor perspectives to provide added value to organizations business, running the audit department as a business, an
in the Industrial Age 4.0.[11],[10]. internal audit always tries to ensure that it can get added
value. The impact of internal audit activities [20] , which
provides added value to the organization, is indicated by:

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(1) Efficiency in operational performance and control of the TheTraditional Internal Audit Paradigm is an old
audit environment. paradigm in Internal Audit in the era before industry 4.0. In
(2) Organizational culture that always improves good this old paradigm, internal audit is an independent, objective
corporate governance and has an impact on the increase in belief and consulting activity designed to add value to the
the reputation of the company organization organization[9].
(3) The existence of internal auditor performance in the form
of operational effectiveness and control for audit In the process of its journey in the industrial era 4.0, the
environmental traditional internal audit paradigm turns out that in various
(4) The increase in professionalism is very high and credible, companies, anomalies occur in internal audit, including
furthermore insight into forensic investigations and good demands for high standards for an internal auditor who must
knowledge of risk management. understand the latest technology, professionalism, and
auditors must be broad-minded[10].
In this study, the organization's added value is an
important role and useful for achieving organizational goals The Internal Audit Paradigm in the Industrial Era 4.0 is
as a result of increased activity in internal audit[14], a New Paradigm in Internal Audit in the Industrial Era 4.0.
[16],[20]. Internal Audit in the Industrial Era 4.0 is a paradigm that has
a principle perspective, standard perspectives, a technology
D. Paradigm Shift Towards the Industrial Era 4.0 perspective, and a professional auditor perspective[10],[11].
As the opinion of Thomas Khun's theory from Zainuri's This paradigm shift is shown in Table 2.
study[7]explains that a paradigm is an understanding, a
change of thought, a pattern towards a better direction from
science, which initiated by the various activities[8]..

Traditional Internal Audit Organization’s Added-value

Internal Audit in Industry Era 4.0
From To So
conventional supervisory processes the real-time monitoring process that utilizes an that efficiency in operational
independently of an auditor internet-based application system performance and control of the audit
environment.
From To So
a scope that is only in line with the high standards with the scope of system-based that good corporate governance and
strategic plan and quality assurance corporate governance and information technology increase the reputation of the
company organization.
From To So
the implementation of audits that are the availability of internet-based data/cloud that the effectiveness of the
no longer required to be present at the computing, mobile applications, and analytical implementation of audits and
location and risk management is data, automation of audit equipment control of the audit environment
carried out in a holistic manner increases
From To So
the ability of the auditor profession professional skills with international certification that the professionalism of the
who uses computers, routine, and and audit insight with the latest technology Auditor is very high and credible.
structured audit experience and
training
Table 2: - Internal Auditing Paradigm Shift

Era revolusi industri 4.0 akan mengubah kinerja dengan 1) Does the Traditional Internal Audit affect Internal Audit in
berbasis teknologi. Sebagai akibatnya maka pelaksanaan The Industry Era 4.0?
aktivitas audit internal harus menyesuaikan dengan kondisi 2) Does the Internal Audit in The Industry Era 4.0 affect
era industri 4,0 tersebut. Beberapa tantangan yang dihadapi Organization’s Added-value?
pada era industri 4.0, yaitu masalah keamanan teknologi 3) Does the Traditional Internal Audit Affect Organization’s
informasi, kurangnya keterampilan yang memadai, Added-value?
ketidakmampuan untuk berubah oleh pemangku kepentingan, 4) Does the Traditional Internal Audit Affect Organization’s
resistensi dan hilangnya banyak pekerjaan karena berubah Added-value mediate by the Internal Audit in The Industry
menjadi otomatisasi. Era 4.0?
5) Does the Traditional Internal Audit Affect Organization’s
E. Research Model Added-value moderate by Internal Audit in The Industry Era
The proposed research model is shown in Figure 1. This 4.0?
model has been developed to answer research questions. The
research questions based on this research model were:

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The research model developed has three variables, Internal Audit in The Industry Era 4.0 (as a moderating or
namely Tradisional Internal Audit (independent variables), mediating variable).
one Organization’s Added-value (dependent variable), and

Fig 1: -Research Model

In addition, Internal Audit in the Industry Era 4.0 as a H3: Traditional Internal Audit has a positive effect on
moderating and also as a mediatingvariable which is a Organization’s added value.
special variable and as a novelty in this research related
paradigm shift in internal auditing. Yuliatma[9] states that the internal audit paradigm has
shifted from being based on a traditional paradigm
F. Hyphotesis Development (compliance audit) to a new internal audit paradigm (Industry
Furthermore, hypotheses based on this research model 4.0 era) which has an effect on providing added value. Based
can develop, as follows: on this, the hypothesis is developed:
H4: Internal Audit in the Industrial Era 4.0 has a role in
Rosmida[1] in her research, describes the mediating Traditional Internal Audit towards added value to
transformation of the role of accountants in the era of the Organization.
industrial revolution 4.0. The results of her study concluded
that accountants in today's traditional internal audit era must Industrial era 4.0 can empower the role of auditors in
have a strategy that influences them to face the challenges of terms of understanding digitalization, which involves the
auditing in the industry 4.0 Era. Based on this, the hypothesis integration of information from various sources and locations
is developed: for physical operations[19]. Based on this, the hypothesis is
H1: Traditional Internal Audit has a positive effect on developed:
Internal Audit in the Industrial Era 4.0
H5: Internal Audit in the Industrial Era 4.0 has a role in
Research by Dai & Vasarhelyi[11] states that there are purely moderating Traditional Internal Audit towards added
effects and the use of technology in the Industry 4.0 audit value to the Organization.
after the audit process will have a broad impact on business.
The broad impact in the business, one of which is an increase III. RESEARCH METHODOLOGY
in operational performance, and this is an added value of the
organization achieved. Based on this, the hypothesis is This empirical study is related to accounting
developed: management known as internal auditing management in
government agencies, state-owned companies (BUMN), and
H2: Internal Audit in the Industrial Era 4.0 has a positive private companies in Indonesia.
effect on Organization’s added value.
A. Samples and Data Collection
Research from Adisty & Priantinah[2] states that For the application of quantitative methods, data
Internal Audit is an independent activity, objective belief, and collection through questionnaire survey techniques collected
consultation that provides added value and improves by using online surveys. In this study, the population used is
organizational operations. Shahimi et al.[12] in their research all internal auditors organizations, the target is ten
also stated that internal auditors provide consultation at the organizations consisting of government agencies, state-owned
request of management, a board of directors, or audit companies (BUMN), and private companies. Then 150
committee, on an ad-hoc basis to help improve business respondents were collected through Convenience Sampling
operations and to achieve organizational goals so that this is techniques. Then finally, valid samples are 100 samples.
interpreted as having an effect in providing organization's
added value. Based on this, the hypothesis is developed:

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B. Data Analysis IV. RESULTS AND DISCUSSION
In the quantitative method, the Likert scale used to
measure the variables of this study (scale of 5). SmartPLS A. Model Testing Results
3.2.7 is software used for data analysis. The main empirical First of all, carry out the analysis phase of the results of
tests are the model test and hypothesis test. The inner and testing the outer models. Analysis of the results of the
outer models test conducted for the proposed research model. measurement of the validity and reliability of research
For this study, by evaluating the validity and reliability of the variables by looking at the value of Cronbach's Alpha and CR
variables and indicators, where Cronbach's Alpha value and and data processing results and executed with Smart-PLS
also Composite Reliability value > 0.7. Hussain et al., [25], version 3.2 [21]. As seen in Table 3, it states that all
stated that the evaluation of the Inner Model related the value Cronbach's Alpha and Composite Reliability values for each
of Goodness of Fit (GoF) and R-square (R2). The hypothesis variable are more than 0.7. These results indicate that all
tested using a P-Value < 5% , and a T-Statistic value > variables used in the study are valid and reliable.
1.960.

Cronbach’s Aplha rho_A Composite Average Variance

Reliability Extracted (AVE)
Traditional Internal Audit 0.826 0.848 0.883 0.654
Internal Audit in 0.868 0.877 0.911 0.722
the Industry Era 4.0
Moderating Effect 1 1.000 1.000 1.000 1.000
Organisation’s Added-value 0.916 0.922 0.941 0.799
Table 3: - Validity and Reliability Test Results

The results of data processing with smartPLS related to where :

Output of Outer Loading in Path Analysis in the measurement β = coefficient value beta dan, ξ = measurement error
model shown in Fig. 2
Goodness of Fit (GoF)
In testing the structural model (Inner Model), the overall
suitability index measured using Goodness of Fit (GoF)
criteria, Q-square values, and R-square values[21]. The
Goodness of Fit (GoF) values are determined using the
following formula:

GoF
= √𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐶𝑜𝑚𝑚𝑢𝑛𝑎𝑙𝑖𝑡𝑦 𝑥 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑅 − 𝑆𝑞𝑢𝑎𝑟𝑒 (3)

= √ 0.725 x 0.929 = √ 0.224472

= 0.820

From the results of testing the model by looking at the

magnitude of the GoF value, it shows that the model has a
Fig 2: - Output Outer Loading very high overall suitability index (GoF value > 0.36).

The results of the study using Structural Equation Q - Square value

Modeling (SEM) analysis, the following equations are The Q-square value is used to show that the research
obtained: model has a predictive relevance level. The Q-square value is
determined by the formula, as follows:
Y = γ11 X +ξ1 (1)
Q - Square
Internal Audit in the Industry Era 4.0 = 1 – [ (1 - R12 ) x (1- R22 )]
= 0.965 * Traditional Internal Audit + ξ1 (4)
= 1 – [ (1-((0.932)2 ) x ( 1-((0.925)2)]
Z = γ12 X + β21 Y + β211 X * Y + ξ2 = 0.981
(2)
Furthermore, the model has a very high degree of
Organisation’s Added-value predictive relevance (Q-square value > 0.35).
= - 0.063* Traditional Internal Audit +1.031* Internal Audit
in the Industry Era 4.0 + 0.033*Moderating Effect-1+ ξ2 R - Square value
The R-Square value aims to measure the predictive
strength of the structural model. It is a representation of the

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number of construct variables explained by the research Regarding the R-Square Value, another thing has
model. The R-Square value is determined based on the results interpreted is that the Internal Audit Era 4.0 is 93.2%
of data processing with smartPLS software, not from the influenced by traditional Internal Audit factors, then 6.8%
formulation. This results shown in Table 4. Internal Audit Era 4.0 is influenced by other factors that not
discussed in this study. Likewise, Organizational Value
R- R-Square Added 92.5% influenced by Traditional Internal Audit, Era
Square Adjusted 4.0 Internal Audit the moderating effect and 7.5% by other
factors not discussed in this study.
Internal Audit in the Industry 0.932 0.931
Era 4.0 B. Hyphotesis Testing Results
Hypothesis testing aims to determine the direct effect of
one variable on another. And to determine the indirect
Organisation’s Added-value 0.925 0.922 influence of the mediating or moderating variables. The
influence of the two variables indicated by the magnitude of
the T-Statistic value is > 1.96. Positive effect if the Original
Table 4 – R-Square Testing Results Sample value as the Beta Coefficient is also positive. While
the significance of the influence indicated by the value of
Internal Audit in the Industry Era 4.0 variable has a Probability (P-Values) <5%. Table 5 shows the results of the
value of 0.032 for R-square and 0.925 for Organisation’s direct effect hypothesis test.
Added-value variable. It means that both of them have a very
high influence category because the R-square value is > 0.30.

Original Sample Sample Mean Standard Deviation T-Statistic P-Value

Traditional Internal Audit 
Internal Audit in the Industry Era
4.0 0.965 0.966 0.004 250.402 0.000
Internal Audit in the Industry Era
4.0
 Organisation’s Added-value
1.031 1.009 0.144 7.154 0.000
Traditional Internal Audit 
Organisation’s Added-value
0.932 0.937 0.015 60.668 0.000
Table 5: - Hypothesis Testing Results (Direct Effect )

Furthermore, Table 6 shows the results of the indirect effect hypothesis test.

Original Sample Sample Mean Standard Deviation T-Statistic P-Value

Moderating Effect 1 
Organisation’s Added-value 0.033 0.033 0.025 1.289 0.198

Traditional Internal Audit 

Internal Audit in the Industry Era 4.0 
Organisation’s Added-value
0.995 0.975 0.141 7.049 0.000

Table 6: - Hypothesis Testing Results (Indirect Effect )

While the T-Statistics Value in the Path Analysis Model with Bootstrapping Algorithm shown in Fig. 3. This figure is the
result of data processing using SmartPLS 3.2.7 by utilizing the bootstrapping algorithm.

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Added-value. H5 rejected. However, based on other
considerations, it shows that the value of the Beta Internal
Audit Beta coefficient in Era 4.0 is 1,031 greater than the
value of the Traditional Internal Audit Beta coefficient, which
is -0.063. On the other hand, the R-Square value of Internal
Audit Era 4.0 is greater than the R-Square value of the
Organization Value Added variable (0.932> 0.925).
Furthermore, it concludes that Internal Audit Era 4.0 has the
potential to moderate the influence of Traditional Internal
Audit on Organization Value Added. This finding is a novelty
of this research.

C. Discussion
The shift in the traditional internal audit paradigm to
internal audit in the 4.0 era in providing added value to the
Fig 3: - Nilai T Statistik pada Model Analisa Jalur organization is interesting to study and research. This is in
line with the concept of industry 4.0 expressed by
Analysis of the results of the hypothesis test states that: Ślusarczyk[5]. The Industry 4.0 concept is the new reality of
the modern economy, as innovation and technological
H1: Traditional Internal Audit significantly and positive development play a significant role in every organization.
influence towards Interal Audit in The Industry Era 4.0 . Beta
coefficient value is 0.965, T-statistik value = 250.402 With the concept of a paradigm shift as stated by
(>1.96), and P-Value = 0.000 (<0.05). H1 accepted. The Thomas Kuhn in Nurkhalis' study [7], then t the internal audit
result is in line with Rosmida research[1] method has experienced a paradigm shift. In line with
H2: Interal Audit in The Industry Era 4.0 significantly and research with Rosmida[9], which states the Transformation of
positive influence toward Organization’s Added-value. The the Role of Accountants in the Era of the Industrial
Beta coefficient value is 1.031, dan nilai T-statistik = 7.514 Revolution 4.0, from what was originally a traditional
(>1.96), and P-Value nya 0.000 (<0.05). H2 accepted. These paradigm (compliance audit) to an internal audit paradigm
results is in line with statements from the Penelitian Dai & leading to the industrial era 4.0 which provides added value.
Vasarhelyi [11]
H3: Traditional Internal Audit not significantly and negative The main results of the research reveal that
influence towards Organization’s Added-value Measurement organizations or companies need to make a paradigm shift.
of the Beta coefficient value is -0.063, and the T-statistic From traditional internal audit to internal audit in the era of
value = 60,668 (> 1.96), and the P-value is 0.000 (<0.05).H3 4.0 in providing added value to the organization. Internal
accepted. This result is in line with research Adisty & Audit Era 4.0 positively and significantly mediates
Priantinah[2], which states that Internal Audit is an Traditional Internal Audit towards the Added Value of the
independent activity, objective belief, and consultation and Organization. These results are a novelty in this study. dan
has an added value affecting and improves organizational mengisyaratkan Organizations need to shift the traditional
operations. internal audit paradigm to internal audit in the 4.0 era so that
H4: Internal Audit in The Industry Era 4.0 mediates it has an impact on providing added value to the organization.
significantly Traditional Internal Audit for Organization’s Related to a paradigm shift and in line with the study of
Added-value. The measurement shows the value of the Beta Yuliatma[9]. Internal Audit in The Industry Era 4.0 can not
coefficient is 0.995, and the T-statistic value = 7,049 (> 1.96), moderate purely Traditional Internal Audit for Organization’s
and the P-value is 0.000 (<0.05). The results of the Added-value. However, the results also add that Internal
measurement are indirect because the mediation effect shows Audit Era 4.0 has significant potential to be able to moderate
the value of the beta coefficient = 0.965 x 1.031. = 0.995 (> - the influence of Traditional Internal Audit on Organizational
0.063). Thus, Internal Audit in The Industry Era 4.0 able to Value Added.
mediates positively and significantly Traditional Internal
Audit for the Added Value of the Organization. H4 accepted. D. Implications and Limitation of the Research
This finding is a novelty of this research. There are several implications of this study which may
H5: Interal Audit in The Industry Era 4.0 can not moderate be relevant for managers and scientific research for working
purely Traditional Internal Audit for Organization’s Added- capital management. First, the results of this study have
value. H5 rejected. The measurement shows the Beta managerial implications that managers in corporate
coefficient value is 0.033, and the T-statistic value = 1.289 organizations. The company must assess the readiness for a
(<1.96), and the P-value is 0.198 (> 0.05). The results of the change in the internal audit paradigm to result in a significant
calculation because the moderation effect shows the value of increase in organizational added value. Second, theoretically,
the moderation effect Beta coefficient = 0.599 x 1.031 = the findings of this study have broad implications regarding
0.995. So, the Beta coefficient value of the measurement the relevance of internal auditing management
moderation effect is smaller than the calculated value (0.033 toward Internal Audit in Industry Era 4.0.
<0.995). Thus, Internal Audit in The Industry Era 4.0 can not
moderate purely Traditional Internal Audit for Organization’s

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However, this study still has several limitations, [8]. A. Kalman, “The meaning and importance of Thomas
including a short observation time and a lack of research Kuhn’s concept of ‘paradigm shift’. How does it apply
objects so the research results do not reflect the effect of the in Education?,” Opus Educ., vol. 3, no. 2, 2016.
shift in the internal audit paradigm as a whole on the [9]. T. Yuliatma, Internal Tradisional menjadi Audit
company. Internal yang Memberikan Nilai ( Studi Kasus Pada PT
Telekomunikasi Indonesia , Tbk), Skripsi. Semarang:
V. CONCLUSSION Universitas Diponegoro, 2011.
[10]. A. Z. Mubarrok, Auditing in 4.0 era. IAI-Jawa Barat,
In summary, the purpose of this study is to analyze the 2018.
paradigm shift of a traditional internal audit into an internal [11]. J. Dai and M. A. Vasarhelyi, “Imagineering audit 4.0,”
audit in the era of 4.0 empirically in providing added value to J. Emerg. Technol. Account., vol. 13, no. 1, pp. 1–15,
the organization. 2016.
[12]. S. Shahimi, N. Dato’ Mahzan, and N. Zulkifli, “Value
The main results in this study Firstly, Internal Audit Era Added Services of Internal Auditors: An Exploratory
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