Internal audit and financial performance of Mayuge District Local Government
Loading...
Date
2015-09
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Kampala International University; College of Economics and Management
Abstract
The purpose of the study was to examine the effects of internal audit on the performance of Mayuge District Local Government. The following were the specific objectives. To examine the effects of internal audit on liquidity in Mayuge District Local Government, to examine the effects of internal audit on accountability in Mayuge District Local Government and to examine the effects of internal audit on reporting in Mayuge District Local Government It was found out that Internal audit has generally been weak in handling and managing the liquidity hence leading to poor financial performance, this has been evidenced from the findings as; detection of fraud may not be possible, segregation of duties regarding handling of liquidity is not there, not all payments are made by district, some receipts are not satisfied by CAO and CFO, districting of locally collected revenues is not compulsory, keeping of cheque books in cash box is not compulsory, not all payments and receipts are in order in the cash books, and receipts books are numbered but serial numbers are not critically followed during internal audit. These make it hard or internal audit to control liquidity hence contributing to the poor financial performance of Mayuge District Local Government. The study concludes that, there exist significant relationships between the variables of study as conceptualized. Internal audit is being high related to poor financial performance of Mayuge district local government, independence of internal auditors was found out to be slightly related to Mayuge District Local Government. The findings revealed that internal auditors were not performing their duties as required of them due to poor management of liquidity by internal auditors. Therefore there is need for the internal audit department to improve on the way they manage liquidity of the local government funds by segregation of duties regarding handling of liquidity ensuring that all payments are made by district, ensuring that all receipts are certified by CAO and CFO, ensuring that all locally collected revenues are districted, ensuring that cheque books are kept in the cash boxes and locked, Ensuring that CFO and CAO are principal signatories on all district accounts, ensuring that all receipts and payments are recorded in the cash book. The findings revealed that the performance of Mayuge District Local Government is poor as accountabilities are not fairly handled. Internal auditors therefore need to improve on the way they handle accountabilities of funds. By verifying accountabilities on a quarterly basis, ensuring that vote controllers account for funds spent, verifying district statements critically while tracing for account-abilities of funds during auditing, verifying all payment vouchers during the audit .
Description
A research report presented to the College of Business and Management in partial fulfillment of the requirements for the Award of a Master's Degree of Business Administration of Kampala International University
Keywords
Internal audit, Financial performance, Mayuge District Local Government