ASSESSMENT OF INTERNAL CONTROL SYSTEM OF SIC LIFE COMPANY LIMITED

ABSTRACT

In this study, the effectiveness of the system of internal control of SIC Life Company Limited is assessed via the famed Internal Control – Integrated Framework by the Committee of Sponsoring Organizations (COSO) of the Treadway commission. Forty-one members of staff at the company’s head office in Accra are sampled for the study. Analyses of the responses to the questionnaire indicate that overall the internal control system of the SIC Life company is only marginally strong. Skewness of total scores for the internal control system components shows a marginal tilt toward the positive region. The theoretical proposition that the control environment component of the internal control system drives the remaining components of the internal control system is also verified. Correlational analysis between the control environment and each of the remaining components of the system of internal control supports this theoretical proposition. It is found that the control environment, which constitutes the philosophies of top management, organizational culture, ethics, integrity, and accountability of top management, is positively correlated with each of the remaining components of the system of internal control of the company. It is recommended that the company takes steps to tighten the internal control system. Particular attention should be paid to the control environment since a stronger control environment will translate into a stronger, effective and efficient overall system of internal control.