INTERNAL AUDIT IN THE PARADIGM OF CONTINUOUS IMPROVEMENT: PHILOSOPHY AND PRACTICE OF THE PDSA MODEL

Abstract

The article aims to substantiate the theoretical, methodological, and philosophical foundations for integrating the PDSA (Plan–Do–Study–Act) model into the system of internal audit within the paradigm of continuous improvement. The research seeks to reveal how the Deming cycle can transform internal audit from a control-oriented mechanism into a process of organizational cognition, reflection, and self-development. The methodological framework combines dialectical, systemic, and cognitive–reflective approaches. The study applies comparative and analytical methods to synthesize the findings of J. E. Reed, S. V. Knudsen, A. Ardianingsih, T. O. Kamenska and other scholars, and to adapt the PDSA model to the epistemological and ethical dimensions of internal audit. The integration of the PDSA cycle ensures the unity of planning, action, reflection, and correction within audit processes. The model enhances adaptability and transparency of managerial decisions, reduces informational entropy, and establishes feedback between control and action. It also contributes to the development of a learning-oriented organizational culture that values reflexivity and ethical accountability. The study reinterprets internal audit as a philosophical–economic mechanism of self-knowledge, where the auditor becomes a mediator between knowledge and practice. It conceptualizes the PDSA model as a cognitive architecture of audit thinking, bridging epistemology, management philosophy, and risk-based reasoning. Applying the PDSA model to internal audit strengthens risk-oriented management, promotes continuous learning, and supports sustainable corporate governance. The findings can be used to design digital tools and frameworks for real-time auditing and knowledge management systems. The integration of the PDSA model transforms internal audit into a dynamic self-learning process that harmonizes control, reflection, and development. The proposed framework enriches the theoretical and ethical foundations of auditing, aligning it with modern paradigms of cognitive management and continuous organizational improvement.