The Effect of Internal Control System on Performance of Local Government Organization in Uganda. Case Study: Nkozi Town Council

Abstract

The research study was carried out to investigate the effects of internal control systems on the performance of local government organization with Nkozi Town Council as the case study. The purpose of this study was to find out why there were still low levels of performance and yet local government has internal control systems in place. The researcher used qualitative and quantitative methods and in particular questionnaires were employed to obtain primary data while secondary data was obtained from, library books and the literature from existing authors, journals. After collecting data, the researcher organized well-answered questionnaire, data was edited and sorted for the next stage. The researcher used SPSS to analyze the findings and relationship between the independent variable and dependent variable under study. The information was then presented tabular form, pie charts and bar graphs with frequencies and percentages to give the meaningful picture of what was on the ground, the researcher used cross tabulation in particular chi square test to establish the relationship between internal control system and performance of Nkozi Town Council. The study findings indicate that Nkozi Town Council had an average internal control system and the level of organizational performance was found to be inadequate. In conclusion, there was a statistically significant relationship between internal controls and performance of local government organization.

The study recommends that management should ensure that all internal control systems are implemented and are not undermined by the staff. Also political interference in the activities of the district should be discouraged so as to create a smooth atmosphere for the proper management. Further research is recommended on internal audit and quality of financial statements. The control environment should further be studied to show the extent it contributes to the financial performance.

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