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Abstract

This study was conducted to examine the influence of audit committee characteristics on the effectiveness of risk management in Public Statutory Corporations (PSCs) in Tanzania, and the moderating effect of the size of an entity on this relationship. A structured questionnaire was used to collect data, which was completed by 424 chief internal auditors and directors of finance from PSCs across various Tanzanian regions, and analysed using SmartPLS (PLS-SEM) version 4.0. The findings indicate that the expertise of the audit committee and the frequency of meetings with a substantive risk agenda positively influence risk management effectiveness in PSCs. Conversely, the study found a non-significant relationship between audit committee independence and integrity with effective risk management practices of PSCs. Furthermore, the size of an entity moderates the relationship between audit committee independence, meetings, and the effectiveness of risk management practices. These findings highlight the importance of expertise and meetings in audit committees, especially for larger entities, in improving risk management practices and achieving strategic objectives in PSCs in Tanzania. Overall, policymakers, PSCs, audit committees, and the Tanzanian government can utilise these insights to improve internal controls, develop suitable strategies for effective risk management practices, and attain their strategic objectives.

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