Internal controls as a tool of effective corporate governance: impact of implementation of a set of internal controls on financial performance of the business. Evidence from Cameroon

Ing. Foreke Azonwoh

Master's thesis

Abstract:

The main objective of the thesis “ Internal controls as a tool of effective corporate governance: impact of implementation of a set of internal controls on financial performance of the business. Evidence from Cameroon ” On the basis of evaluation of impact of implementation of a set of internal controls on financial position and performance of the chosen company from Cameroon to identify advantages and disadvantages of this quality control tool and to make a set of recommendations for companies from Cameroon going for such implementation or improvement of their existing systems. The theoretical part consists of corporate governance, its definition, principles and how internal controls are an essential tool for effective corporate governance. Also, an overview of the internal control in different reporting cycles such as inventory and warehouse, fixed asset acquisition and disposal, and cash receipt cycle. The practical part covers the description of the chosen company, the methodology and data used an overview of financial ratios such as profitability, liquidity and investment ratios used for appraisal. Description of original IC in chosen cycles and description of deficiencies and the impact of deficiencies in internal controls on financial position and performance of the company before the implementation of strong internal controls in the business reporting cycles and the use of financial ratios to measure impacts of implementation of internal controls. The results of this show the implementation of a sound internal control on reporting cycle were beneficial to the company as the performance of the company improved.

Abstract:

The main objective of the thesis “ Internal controls as a tool of effective corporate governance: impact of implementation of a set of internal controls on financial performance of the business. Evidence from Cameroon ” On the basis of evaluation of impact of implementation of a set of internal controls on financial position and performance of the chosen company from Cameroon to identify advantages and disadvantages of this quality control tool and to make a set of recommendations for companies from Cameroon going for such implementation or improvement of their existing systems. The theoretical part consists of corporate governance, its definition, principles and how internal controls are an essential tool for effective corporate governance. Also, an overview of the internal control in different reporting cycles such as inventory and warehouse, fixed asset acquisition and disposal, and cash receipt cycle. The practical part covers the description of the chosen company, the methodology and data used an overview of financial ratios such as profitability, liquidity and investment ratios used for appraisal. Description of original IC in chosen cycles and description of deficiencies and the impact of deficiencies in internal controls on financial position and performance of the company before the implementation of strong internal controls in the business reporting cycles and the use of financial ratios to measure impacts of implementation of internal controls. The results of this show the implementation of a sound internal control on reporting cycle were beneficial to the company as the performance of the company improved.

Keywords

Effective internal controls, Business Reporting cycles, Corporate governance.

Language used: English

Date on which the thesis was submitted / produced: 16. 5. 2022

Thesis defence

• Date of defence: 22. 6. 2022
• Supervisor: Ing. Oleksandra Lemeshko
• Reader: Ing. Petr Valouch, Ph.D.

Masaryk University

Faculty of Economics and Administration

Master programme / field:
Finance / Finance