Effect of Internal Controls on the Performance of Co-Operative Credit Unions in the Brong Ahafo Region of Ghana

Abstract

The purpose of the study was to examine the effects of internal control on the performance of co-operative credit unions in the Brong Ahafo Region of Ghana. Descriptive survey design was adopted for the study. The Yamane`s sampling technique was used to select the 167 respondents who were key employees of the CUs. Questionnaire was used to collect the data. The data were analysed using both descriptive and inferential statistics. The study revealed that internal control has significant positive effect on the performance of the co-operative credit unions in the Brong Ahafo region of Ghana. Also, it reveals that the major challenge or limitation to internal control is poor response to anomalies reported. Also, proper implementation of controls was found to be a challenge in the sampled CUs. However, greater proportion of the selected co-operative credit unions has good internal control systems in place and personnel or workers have the necessary skills and attitude to maintain the systems of internal control. Clearly, internal control practices have been found to be available at all levels of the organisational management hierarchy. The study recommends that the management of credit unions should effective and efficient implement internal control systems that matches their business` needs and invest in them appropriately to enhance the performance of the CUs. Also, the co-operative credit unions should embrace and invest significantly in risk assessment and management to maximize the benefits of internal control systems. This current study would serve as a wake-up call for all stakeholders with respect to ensuring the effective use of internal control systems in their organisations.