Internal Financial Control System and Performance of The Komenda Edina Eguafo Abrem Municipal Assembly

Abstract

ABSTRACT Several studies have been done in the area of internal financial control system of organisations in countries outside Africa, in Africa and also in Ghana. Such works posited that a good internal financial control system where there is proper documentation of financial transactions, direct and indirect control and preventive controls, helps the organisation to perform well financially. Added to that, they also ascertained that, there is a direct relationship between financial performance and good internal financial control mechanisms put in place by the company. Thus, using a positive paradigm through a descriptive quantitative method, the study set out to critically examine the internal financial control system of the Komenda Edina Eguafo Abrem Municipal Assembly. It made use of the staff of the Municipal Assembly as its respondents. The study found out that apart from a few challenges with the Assembly’s internal financial control system, it is doing very well in adhering to all internal financial control practices. Again, the study recognised that there is a direct association between financial performance and internal financial control practices. However, it came out that, the Assembly does not provide enough logistics for financial monitoring, being one of the important pillars of internal financial control system. Furthermore, it was discovered that there is a positive link between the presence of IFCS and the financial performance of the Assembly. More so, a good IFCS practices will help the Assembly to rake in more money to undertake its projects. In view of that, there were suggestions that adequate logistics must be provided for proper monitoring of the system to ensure good financial performance; the revenue unit of the Assembly must be decoupled from the financial unit for more effective and efficient work, among others.