Accounting Risk Management, Internal Control Procedures, Firm Characteristics and Performance of State Enterprises in Uganda

Abstract

The study examined the effect of accounting risk management, internal control procedures and firm characteristics on performance of state enterprises in Uganda. It evaluated the relationship between accounting risk management and performance of state enterprises; the intervening effect of internal control procedures on the relationship between accounting risk management and performance of state enterprises; the moderating effect of firm characteristics on the relationship between accounting risk management and performances of state enterprises and the joint effect of accounting risk management, internal control procedures and firm characteristics on performance of state enterprises in Uganda. The study adopted positivism research philosophy and used in sampling; census survey informed the selection of the target population. Pearson correlation coefficient, regression analysis, and analysis of variance to analyse data. Three types of regression analyses were performed; simple linear, hierarchical and stepwise regression analyses. The results were interpreted using r, R2, and the F-statistic and p-values. The study targeted a population of 34 state enterprises from where 32 firms responded, realising a response rate of 94%. From the hypotheses testing, the findings showed that there was a positive and significant relationship between accounting risk management and performance of state enterprises in Uganda; there was a partial intervening effect of internal control procedures on the relationship between accounting risk management and performance of state enterprises in Uganda; there was a moderating effect of firm characteristics (firm size and firm ownership) on the relationship between accounting risk management and performance of state enterprises in Uganda. Furthermore, the results showed a joint significant effect between accounting risk management, internal control procedures and firm characteristics on performance of state enterprises in Uganda. The study suggested that to enhance performance of state enterprises, these enterprises should comply with and adhere to accounting risk management. They should also institute stringent effective internal control procedures in all its functional areas. Therefore, basing on the study findings, the researcher recommends that the management of state enterprises should monitor and supervise operations of state enterprises to ensure that accounting regulations and internal control procedures requirements are properly implemented and comply with accounting standards and principles to improve performance.