Impact of Internal Audit On Financial Performance: A Case Study of Pride Microfinance Ltd, Kabalagala Branch, Kampala

TABLE OF CONTENTS

DECLARATION

APPROVAL

.

ii

DEDICATION iii

ACKNOWLEDGEMEN~1’ iv

LIST OF TABLES viii

LIST OF FIGURES ix

ChAPTER ONE: INTRODUCTION 1

1 .1 Background of study 1

1.2 Statement of the Problem 3

1.3 Objectives of the study 4

1.3.1 General objective 4

1.3.2 Specific Objectives 4

1.4 Research Questions 4

1.5 Hypotheses~ 4

1.6 Scope of the Study 5

1.6.1 Geographical Scope 5

1.6.2 Content Scope 5

1.6.3 Time Scope 5

1.7 Significance of the Study 5

1.8 Conceptual Framework showing independent and dependent variables 6

1.9 Definition of key terms 6

CHAPTER TWO~ 8

LITERATURE REVIEW 8

2.0 Introduction 8

2.1 Internal audit systems used in Pride Microfinance, Kabalagala, Uganda

2.1 .1 Control Environment 8

2.1.2 Control Activities 9

2.1.3 Risk Assessment and performance 9

2.1.4 Monitoring 9

2.2 Challenges facing internal audit systems at Pride Microfinance, Kabalagala, Uganda 10

2.2.1 Corporate Governance 10

2.2.2 Risk management 10

2.2.3 Conflict in internal auditing 11

v

2.2.4 Developing a Workforce Strategy 11

2.2.5 Leveraging Technology 11

2.3 Relationship between internal audit and financial perfonnance Pride Microfinance, Kabalagala,

Uganda 12

CHAPTER THREF 14

~~ODOLOGY 14

3.0 Introduction 14

3.1 Research design 14

3.2 Study population 14

3.3 Sample size 15

3.4 Sampling methods 15

3.4.1 Purposive sampling 15

3.4.2 Random sampling 16

3.4.3 Stratified random sampling 16

3.5 Data Sources 16

3.6 Data collection instruments 16

3.6.1 Questionnaire 16

3.7 Data analysis 17

3.8 Data Processing 18

3.9 Ethical Consideration 18

CHAPTER FOUR 19

PRESENTATIONS, INTEPRETATIONS AND ANALYSIS OF DATA 19

4.0 Introduction 19

4.1 Demographic characteristics of respondents 19

4.1 .1 Gender of Respondents 19

4.1.2 Age of the respondents 20

4.1.3 Education Levels of the Respondents 20

4.2 Findings on internal audit systems used in Pride Microfinance, Kabalagala, Uganda 21

4.3 Findings on Challenges facing internal audit systems at Pride Microfinance, Kabalagala, Uganda

26

4.4 Findings on Relationship between internal audit and financial performance Pride Microfinance,

Kabalagala, Uganda 30

vi

CV~ PTER FIVE .36

Si~~.h~ARY OF DISCUSSiONS, CONCLUSIONS AND RECOMMENDATIONS 36

5.0 Introcluction 36

5.1 Summary of the discussions 36

5.1 . I Demographic characteristics of respondents 36

5.1 2 internal audit systems used in Pride Microfinance, Kabalagala, Uganda 36

~. i .~ iiailcnges facing internal audit systems at Pride Microfinance, Kabalagala. Uganda 38

5.1, Relationship between internal audit and financial performance Pride Microlinance, Kabalagala,

Uganda 40

5.2 Conclusions 41

5.2.1 Internal audit systems used in Pride Microfinance, Kaba[àgala, Uganda 41

5.2.2 Challenges facing internal audit systems at Pride Microfinance, Kabalagala, Uganda 42

5.2.3 Relationship between internal audit and financial performance Pride Microfinance, Kabalagala,

Uganda 42

5,3 Recommendations 42

5.4 Areas of the future research 43

REFERENCES 44

APPENDICES 47

APPENDIX 1: QUESTIONNAIRE 47

APPENDIX II: INTERVIEW GUIDE 51