Quantitative and qualitative investments in internal control personnel and firm operational efficiency: Evidence from Korea

Although internal control systems in firms aim to provide reasonable assurance regarding objectives related operations, reporting, and compliance, research focusing on operational efficiency is limited. This study investigates the impact of both quantitative qualitative investments personnel a firm’s efficiency. Utilizing fixed-effect regression model, Heckman (1979) two-stage least squares procedure, this analyzes 4,471 firm-year observations from Korean listed 2018 2020. The findings indicate positive association between investment relationship remains robust even under sensitivity tests concerns potential endogeneity, as confirmed by models. Specifically, model shows that ratio number employees (coef = 0.023, t-value 5.20) certified public accountants 0.256, 5.43) responsible for positively associated with Average work experience 0.002, 1.84) also provides empirical evidence significance investing boost suggests should consider aspects control.