TABLE OF CONTENTS
CHAPTER ONE Pages
Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . . . . . . .. m
Dedication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . 1v
Acknowledgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . . .. . . . . . . v
Table of contents......................................................................... vi
List of tables.............................................................................. 1x
Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x
List of Acronyms......................................................................... x1
Abstract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... xii
CHAPTER ONE : INTRODUCTION
1.0 Introduction ............................................................................. .
I.]
1.2
1.3
1.4
1.5
1.6
1.7
1.8
2.0
Background to the Study .............................................................. .
Statement of the Problem .............................................................. .
Purpose of the Study ..................................................................... .
Objectives of the study ................................................................. .
Research Questions ..................................................................... .
Conceptual Framework ................................................................ .
Scope of the Study ..................................................................... .
Significance of the study .............................................................. .
CHAPTER TWO: LITERATURE REVIEW
Introduction ............................................................................. .
VI
2
3
3
3
4
5
5
6
2.1 De11nitions of Internal Controls........................................................ 6
2.2 Objectives and Importance of internal controls...................................... 7
2.3 Types oflntemal Controls.............................................................. 8
2.4 Cash system and its Importance....................................................... 8
2.4. I Transactions Motive.................................................................... 9
2.4.2 Precautionary Motive................................................................... 9
2.5 Internal Controls and Cash Managements Systems................................ 9
2.5.1 Internal Control Procedures over Cash Receipts.................................... 10
2.5.2 Internal Control Procedures over Cash Disbursements............................ 10
2.5.3 Internal Control Procedures over Petty Cash........................................ 11
CHAPTER THREE RESEARCH METHODOLOGY
3.0. Introduction.............................................................................. 12
3.1 Research Design......................................................................... 12
3.2 Survey on Population and Area....................................................... 12
3.3 Sample.................................................................................... 13
3.3.1 Sampling Design........................................................................ 13
3.3.2 Sample size............................................................................... 14
3.4 Source ofData........................................................................... 14
3.5 Data Collection Methods and instruments........................................... 14
3.6 Data Processing and analysis.......................................................... 14
vii
CHAPTER FOUR: PRESENTATION, ANALYSIS AND
INTERPRETATION OF DATA
4.0 Introduction............................................................................. 16
4.1 Existing internal control over cash at Kaabong district . .. . . . . . . . . . . . . . . ... . . . . . 16
4. l. I Security of controls..................................................................... 17
4. 1.2 Segregation of duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . .. 17
4. 13 Arithmetic and accounting controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 17
4.1.4 Authorization and approval........................................................... 18
4.15 Supervision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 18
4.1.6 Budgetary control........................................................................ I 8
4.2 Effectiveness of internal controls over cash management .. . . . . . .. . . ... . . . . . . . . . .. 20
4.2. l Internal control over receipt . .. . .. . . ... . . . . . .. . . . ... . . . . . . . . . . . ... . . . . . . . . . . . . . . . . . . . .. 20
4.2.2 Internal controls over cash disbursements........................................... 21
4.2.3 Internal control over petty cash . . . . . . . . . . . . .. . . . . . .. . . . . .. . . . . . . . ..................... 22
4.2.4 Other internal control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . 23
CHAPTER FIVE: SUMMARY, DISCUSSION, CONCLUSION AND
RECOMMENDATIONS
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 24
General findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Areas for further research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
References
viii
Table I:
Table 4 (a)
Table 4 (b)
Table 4 ©
Table 4 (d)
Table 4 (e)
LIST OF TABLES
Response
Internal controls over cash at Kaabong district
Implementation of internal controls and recommendations by
Auditors
Effectiveness of internal controls over cash receipts
Effectiveness of internal controls over cash disbursements
Effectiveness of internal controls over petty cash
ABSTRACT
Internal controls in organizations of measures and methods adopted by management to safeguard its assets, check the accuracy and reliability of accounting data, promote operational efficiency and encourage adherence to prescribe management policies. Internal controls include segregation of duties, recruitment of able and qualified staff, prompt supervision and continuous internal checks. Persistent mismanagement cash from Kaabong District Local government has led the researcher to doubt whether the above internal controls could be weak and this fanned the basis of the research. The methods of data collection used included questionnaires, which were administered to employees oflhe local government by CFO, CAO, accountants and auditor. Findings revealed that much as there are internal controls at Kaabong district local government, he implementation is not yet to the required standards. As a local government that deals in transacting money, here is need to strengthen these internal controls, as the district will be a stake. Further area of research raised include the effect if bookkeeping on internal controls performance, management of cash on business performance and the effect of employee motivation on internal control system performance.
