The Impact Of Internal Controls On Tertiary Institution 's Financial Performance

Internal controls are the measures a company takes to do accomplish two primary goals; protect their assets from employee theft, robbery and unauthorized use. Internal controls are also used to increase accuracy of company financial information, reducing the risk of errors (accidental) and irregularities (intentional) (Weygandt, 2009).

The accomplishments and failure of an entity will be contingent on how successful it utilizes its obtainable assets. In any commendable industry it is significant to delineate corporate aims that are easily dignified, retain the ability to be tracked, and take the required time workings to strive for. Operative organizational goals oblige various purposes; such as tracking the number of hired or termed employees, conducting a tracking management survey system for all termed employees, calculating total billing, or weighing sales commissions; through implementing a logical perceptive to improve discernment into the arrangement of the occupational tactic and calculated development.

Measuring performance means when a business will measure the quality of the activities that are passing and the quality of the services provided to the customers by employees. It involves creating a simple, but effective, system for determining whether organizations meet objectives. It’s also a process of collecting and reporting information regarding the performance of an individual, group or organizations. It can

Internal control has different control principles, establishing responsibility focuses on allotting different tasks to a concerned person, like each sales person should have an individual sales register. Different controls on physical, mechanical and electronic should be exercised as this will help in reducing the unauthorized use of different resources, this is essential for safeguarding assets and

There are many rules companies must follow whenever documenting financial information or any other data which is gather during any business transactions. In order for said companies to report financial information internal controls have to be put in place as companies have to adhere to certain laws and regulations. Internal controls can be defined as a process which companies follow in order to ensure all financial reporting is done in a reliable and lawful manner. Some think of it as a system which works within a system as it plays a major role on the success of a company’s accounting system. At the organizational level, internal control objectives relate to the reliability of financial

So what are internal controls? And why are they so important? Internal controls describe the policies, plans, and procedures

Internal controls are vital to any company’s business and financial sustainability. Internal controls consist of measures taken by a company safeguarding against fraud, and theft. Internal controls ensure accuracy and reliability in accounting data, and secure policies within the organization. Further, internal controls evaluate all levels of performance. These are addressed with five principles

Internal controls represent an organization’s processes and procedures used to meet its goals and objectives and serve as a defense in safeguarding assets and preventing and detecting errors, fraud, and abuse. Effective internal controls provide reasonable assurance that an organization’s objectives are achieved through (1) reliable financial reporting, (2) compliance with laws and regulations, and (3) effective and efficient operations. The passing of the Sarbanes-Oxley Act of 2002, as well as the numerous corporate frauds and bankruptcies over the past decade—including some

Internal Controls are to be an integral part of any organization's financial and business policies and procedures. Internal controls consists of all the measures taken by the organization for the purpose of; (1) protecting its resources against waste, fraud, and inefficiency; (2) ensuring accuracy and reliability in accounting and operating data; (3) securing compliance with the policies of the organization; and (4) evaluating the level of performance in all organizational units of the organization. Internal controls are simply good business practices (Strauss, 2003). And, since internal controls can have many more meanings in the world of accounting, the more we understand what were dealing with, the better we can analyze internal

1. Internal control is a process designed to guarantee the achievement of the objectives of reliable financial reporting, compliance with laws and regulations and ineffective and inefficient operations.

Inward administration control is for the most part characterized as the procedure affected by the an element's administration, top managerial staff and other top faculty, intended to give discerning confirmation as to the accomplishment of goals in productivity and adequacy of operations, consistence with relevant arrangements, laws and directions and unwavering quality of budgetary reporting. Inward control can help an element accomplish its execution and gainfulness targets and avoid loss of assets (Cheng, Dhaliwal and Zhang, 2013). It goes far in guaranteeing trustworthy budgetary reporting consequently evading harm to an element's notoriety and different results and helping a substance to achieve its objectives and stay away from undesirable

There are several procedures that should be considered when implementing internal controls for your business. There should be a segregation of duties between different individuals to lessen the threat of

Corporate performance can be defined as fundamental measures of organizational aptitude used to assess the “health” of the organization and to provide focused direction to operations while supporting managers. In order to measure the company’s intangible assets such as customer relationships, internal processes, and employee learning and development while aligning the corporation’s overall business strategy, statistical analysis of performance measurement data must be utilized.

Economic performance is whether the company strategy and its execution have contributed to the ultimate performance. Economic performance is mainly reflected in four aspects: profitability, operating capacity, solvency and ability to resist risks. Economic performance can be shown in the impact of managing cost, the effect of property management, the influence of the distribution of capitals, and the composing of the shareholders ' equity return rate. The standpoint of profitability evaluation is economic added value and the rate of rise (profit). Choosing EVA in the net assets income rate, the return on total capitals and income per share index, this evaluation of enterprise profitability can reflect the condition of capital net income and capital gains, this is also the development trend of enterprise performance evaluation index. Besides, sales revenue (profit) growth rate index is used to measure enterprise growth. Operation ability can promote firms to enhance capital management, increase the service efficiency of property and improve profitability. The primary evaluation indexes are: stock turnover, debt receivable turnover and permanent assets turnover. The strength of the debt paying ability is the economic and fiscal status of a company . Moreover, it is a significant measure of business control. Primary indicators are worth debt ratio, liquidity ratio and acid test ratio. Anti risk capacity is the ability to prevent the adverse effects of various factors in the

Effective internal controls protect a company’s assets, maintain compliance, improve operations, prevent fraud, and promote accuracy in financial reporting. In 1992 the