Internal Control Systems And Financial Performance Of Municipal Urban Councils In Northern Uganda: A Case Study Of Kitgum Municipal Urban Council.

ABSTRACT This study investigated the Internal Control System that influenced financial per balance  in Municipal Urban Councils in northern Uganda: a case folium Municipal Urban  (KMUC2. The objectives of the study were: to explore the relationship between internal control activities and FP in K1vl(JC~ to find out how the internal control environment affects FP in KMFJC; ana~ to assess the impact of auditing on FP in KMUG.A descriptive research survey design was adopted using both qualitative and quantitative methods. The study targeted 70 respondents but 58 returned the survey questions; indicating a response rate of 83%. Strafed sampling’ techniques were used to select adininistr~itive staff andpurposive sampling used to selectpoliz kal leaders and top-level administrators. Data analysis invofvedfrequencies, percentages and inferential statistics such as correlations, and coefficient of determinations. Findings revealed a moderate positive relationship (0.271 ‘~) between internal control activities and FP; signj,fIcant relationship betwee,z internal control environment and Fl’ (0.335*); and moderate positive relationship between audit andF? (‘0. 265*,~. The study concludes that internal com’ro! activities, internal controlenvironment and auditpositively affected F? in one way or the other. The study recommends that KMJJC should employ professional members ofthe institute of Certified Public Accountants of Uganda in the Internal Audit Department since 36.2% of the respondents opposed si~fjIcient staffing qf the department which is the custodian of the ICS. The environment for the implementation ofK5 should he improved by ensuring that Management is committed to the operation of the system, closely monitoring its implementation and givingfeedback t’o the staff District Public Accounts Committee capacity should be built and their office properly facilitated to enable them fOllow up infernal and/i reporLc .~o Idat corrective nzeasures~di’e~aken.