Effects Of Internal Control Systems On The Financial Performance Of Credit Unions In The Sekondi-Takoradi Metropolis.

ABSTRACT

Internal control systems are primarily established to enhance the reliability of

financial performance directly or indirectly by increasing accountability

among information providers in an organisation. As the credit unions in Ghana

has existed over the past twenty years but their activities have not witnessed

significant growth as compared to banks and financial services within the

country. It therefore calls for a systematic approach to analyse the internal

control system within credit unions and how it has affected their financial

performance over the years.This study sought to determine the effect of

internal control system on the financial performance of Credit Unions in the

Sekondi-Takoradi Metropolis. There were sixteen credit unions in the

Metropolis. All sixteen were used for this study. Quantitative analysis was

employed for this study. Some of the findings from the study revealed that

Credit unions in Sekondi-Takoradi Metropolis have structured control

environment which included the presence of policies that guided work process

and roles and responsibilities that highlights each employee’s role and

responsibility. It was therefore recommended that the management of credit

unions should exert collective efforts in identifying the ideal mix of effective

and efficient internal control systems that match their business needs and

invest in them, and future researchers should consider replicating this study in

the all financial institutions in Sekondi-Takoradi order to establish the role of

internal audit in financial institutions.