Internal Control System and Budget Performance in Local Governments, a Case of Koboko District Local Government

Abstract

Budget performance in Uganda is essential for decentralization policy framework. Koboko District Local Government budget performance has had some gaps. It was on this basis that the study sought to analyze the effect of internal control system on budget performance. The study objectives were: to examine the effect of control environment on budget performance, analyze the effects of control activities on budget performance and to establish the effects of monitoring and evaluation on budget performance.

Cross-sectional survey design was used to collect data from 52 respondents drawn by simple random sampling from an accessible population of 59 people. Data was collected through questionnaires, interview guide and documentary review and analyzed by use of descriptive and inferential statistics. The study attained a response rate of 88.6%.

Regression analysis showed that control environment, control activities, monitoring and evaluation had positive effect on budget performance with p-values (0.000) <0.05(level of significant) and R2 values above 0.7(70%).

The study concluded that internal control system positively affected budget performance in terms of Revenues Received and Expenditures.

The study recommended that management should lobby for lifting of recruitment ban, IFMS to be introduced, external auditing should be done more than once a year, segregation of duties, inspection of assets and motivation of staff to control risks.

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