An evaluation of the effectiveness and efficiency of internal financial controls in state-owned enterprises in Namibia: A case study of the Namibia Development Corporation head office projects (Kavango Cattle Ranch and Naute) and regional offices
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Date
2018
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University of Namibia
Abstract
The thrust of this study was to evaluate the effectiveness and efficiency of internal
financial controls in state owned enterprises in Namibia and this was done within the
context of the Namibia Development Corporation. The investigation was done to
examine the relationship that exists between internal financial control and financial
accountability, and misappropriation of public funds. The investigation was
prompted by the increase in public sector scandals and misappropriation of public
funds in Namibia. The study employed a single case study research strategy to
answer the research problem and the study used only senior executives, employees in
the audit department, accounting and administration that were drawn from the
organisation's head office in Windhoek, projects offices in Kavango cattle ranch and
Naute as well as its regional offices countrywide. The participants were randomly
selected. The questionnaire was used as the main research instrument of data
collection and the Statistical Package for Social Sciences was employed for analysis.
The study results showed that there is a significant positive relationship between
financial accountability and fraud detection. According to the results of this study,
there is a significant positive relationship between internal financial control and fraud
detection, prevention of errors as well as financial accountability on the part of the
NDC as an organisation that is owned by the state. Therefore, it was concluded that,
state owned enterprises with effective internal financial controls can realise better
financial accountability to their stakeholders. It was also established from the study
that there was a significant positive relationship between internal financial control
and protection of the interests of both the organisation and the employees. Thus, an
improvement in internal financial control helps state owned organisations to improve
service delivery and avoid a lot of misappropriation of funds. In relation to
employees, it reduces the degree to which they may be accused of irregularities. The
researcher recommends that state owned enterprises should continue to establish and
strengthen their internal financial control systems in a bid to enhance financial
accountability. This can be achieved through the implementation of policies,
recruitment of competent employees and ensuring there are monitoring and
evaluation systems in place
Description
A thesis submitted in partial fulfilment of the requirements for the Degree of Master of Business Administration (Finance)
Keywords
Financial controls, Namibia Development Corporation, Namibia, Kavango cattle ranch, Naute, Internal financial control, University of Namibia