A survey of the role of internal audit in promoting good corporate governance in Saccos
Abstract
The importance of corporate in ensuring sound financial reporting and deterring fraud has
received growing recognition in the recent past. Internal auditing is one of the means of
enhancing corporate governance in organizations. This is especially true if an organization
adequately structures and provides resources to the internal audit function.
This study sought to establish the role of internal audit in promoting good corporate
governance in SACCOs. The study used exploratory research and primary data was collected
using a questionnaire. The population comprised of all the 4,200 SACCOs registered in Kenya
with a sample of 20 employee based SACCOs based in Nairobi being used. Twelve responses
were received representing sixty percent of the sample size.
Most large SACCOs have set up internal audit functions and established audit committees. The
study found that to promote the independence of the internal audit functions it should report to
the board audit committee and that the head of internal audit is dismissed after the approval of
the audit committee.
The study found out that the main activity of internal audit is evaluating the adequacy of
internal controls, providing assurance about the achievement of the organization's objectives
with regard to reliability of financial reporting and compliance to applicable laws and
regulations. However, limited resources and inadequate structures impact negatively on
internal audit's role towards promoting good corporate governance.
The study concluded that internal audit function plays a role in promoting good corporate
governance in SACCOs.
Citation
Masters Of Business Administration (MBA) DegreePublisher
University of Nairobi School of Business
Description
A research project submitted in partial
fullfillment of the requirements for the
Degree of Masters in Business Administration