Internal audit functions and performance

Abstract

The purpose of the study is to establish the relationship between internal audit function and performance of the local governments in Uganda in particular Adjumani local government. It was guided by four objectives; the main objective of the study was to assess the relationship between internal auditing and performance of an organization along with corresponding impacts on their performance using the case study Adjumani Local Government, to analyze the effects of risk management on performance of local governments, to analyze the how corporate governance influences performance of local government, to assess the factors that influence internal control on performance of Adjumani local government. The researcher collected data using questionnaires and interviews and during data collection, both qualitative and quantitative methods of data collection were used to analyse data as sample of 92 respondents were selected from Adjumani local government out of the 120 total populations. The study revealed that the nature of internal audit in Adjumani LG involves proper risk management good internal control, proper corporate governance, physical accountability which conforms to the rules and procedures of the LG. This study also established the relationship between internal audit function and performance of Adjumani LG. The study findings therefore revealed that there disclosure and transparency of information and reports in LGs are crucial measures which attract proper decision making and planning in the local governments, it revealed that the major crucial factor in LGs is accountability because it helps the LG to know what amount of money was spent on different ventures in financial year, It further confirmed that good internal control in Adjumani LG helps in funding tax payers, monitoring activities and also it enhances the reliability of financial performance either directly or indirectly which therefore will lead to efficiency and effectiveness of LG’s performance. The study therefore recommends maintaining the proper records by making daily reports on the transactions made so that to have accurate information that will help to minimize frauds in the local government, and also that the local government should maintain proper controls that is in place so that to have proper accounting records.