EFFECT OF INTERNAL CONTROL ON FINANCIAL PERFORMANCE OF SOME SELECTED COMMERCIAL BANKS IN MOGADISHU SOMALIA
Keywords:
Internal control, financial performance, risk assessment, Control Environment, Information & Communication, control Activities.Abstract
The purpose of this study was to investigate the effect of internal control on financial performance of commercial banks in Mogadishu Somalia. The objectives of the study included, to describe the effect of control activities on financial performance of commercial banks in Mogadishu Somalia. to examine the effect of control environment on financial performance of commercial banks in Mogadishu Somalia. to determine the effect of Risk Assessment on financial performance of commercial banks in Mogadishu Somalia. to evaluate the effect of information and communication system on financial performance of commercial banks in Mogadishu Somalia. The study was carried out using descriptive research design. The target population is 110 participants. The sample size comprised of 86 respondents those came from our specific target groups especially financial directors, internal audits, supervisors, chief cashier and head departments. Data was collected by use of questionnaires and was analysed by use of descriptive statistics and Pearson Product Moment Correlation Coefficient. The findings of this study reveal that majority of commercial banks in Mogadishu has clear organizational structure and has enough cash to meet its obligations effectively. The study recommends that banks should build and maintain effective internal controls because of the banking sector's riskiness and its impact on financial performance.
