The Impact Of Internal Control Systems On Performance Of Iganga Municipal Council

ABSTRACT

The main purpose of the study was to examine the impact of internal control systems on

performance of Iganga Municipal Council.

The objectives of the study were to find out the different types of internal control systems in

Iganga Municipal Council, to establish the level of performance and establish the relationship

between internal control systems and performance of Iganga Municipal Council.

The study employed a cross sectional research design and used self-administered questionnaires.

A sample size of 60 respondents was used and the distribution included 9 from procurement, 4

from finance, 14 from works, 11 from education, 5 from administration departments, l3from

heath and 4 from the audit department.

From the findings it was revealed that the major types of internal control systems used in Iganga

Municipal Council are; recording, authorization, approval, plus supervision and reviews.

Findings also reveal that Iganga Municipal Council lacks physical controls like fire extinguishers

and alarm systems which makes its security questionable.

Conclusions are drawn from the research objectives of the study and it can be concluded that

internal control systems have a positive impact on the performance of Iganga Municipal Council.

Recommendations were; Management should ensure that there are adequate organizational

controls and that each staff knows his duties and equally ensures effective segregation of duties,

the internal control system should be remolded and strengthened to position the staff in carrying

out their duties efficiently and effectively and at the same time evaluated periodically to

strengthen its weaknesses in the organization, Iganga Municipal Council should institute physical

controls like watch men, alarm systems, and fire extinguishers to be protected from massive

dangers of theft and finally Internal trainers or refresh courses for employees about internal

control systems should be taken into account and instituting a strong internal control systems to

ensure that there is reliable and efficient accountability provided as per laws and regulations

TABLE OF CONTENTS

DECLARATION

APPROVAL

DEDICATION

ACKNOWLEDGEMENT iv

TABLE OF CONTENTS

LIST OF ACRONYMS

LIST OF TABLES \

ABSTRACT

CHAPTER ONE

INTRODUCTION 1

1.0 Introduction 1

1.1 Background of the study

1.2 Statement of the Problem 3

1.3 Research Objectives

1,3.1 General objectives

1.3.2 Specific Objectives 3

1.4 Research Questions 4

1.5 Significance of the Study 4

1.6 Scope of the study 4

1.6.1 Content scope

1.6.2 Geographical scope

1.6.3 Time scope 5

1.7 Conceptual framework 5

V

CHAPTER TWO.6

LITERATURE REVIEW 6

2.0 Introduction 6

2.1 Internal control system 6

2.1.1 Control Activities 7

2.1.2 Performance 8

2.2 Internal Control systems and Performance 9

2.3 Types of Internal Control systems 10

2.4 Relationship between internal control system and performance 11

CHAPTER THREE 12

RESEARCH METHODOLOGY 12

3.0 Introduction 12

3.lResearch design 12

3.2 Target population 12

3.3 Sampling 12

3.3.1 Sample size 13

3.4 Data collection techniques 13

3.4.lQuestionnaire 13

3.4.2 Interview 13

3.4.3 Observation 14

3.5 Sources of data 14

3.5.1 Primary data 14

3.5.2 Secondary data 14

3.6 Data processing and analysis 14