ASSESSMENT OF INTERNAL CONTROL EFFECTIVENESS: IN CASE OF CARE ETHIOPIA

Abstract

The objectives of this study was assessing the internal control effectiveness of international NGOs in Ethiopia taking CARE Ethiopia as a case study. To achieve its objective, the study was tried to assess about five control elements of internal control. These are Control Environment, Control Activities, Risk Assessment Practice, Information and Communication using system and Monitoring and Evaluation system of internal control. Based on this, the study collected data from employee of the organization using structured questionnaire and interview. Accordingly, 32 respondents were participated. Both the questionnaire and interviews results were used to answer the research questions. For the interview purposive sampling techniques was made. The data gathered from questionnaire analyzed by descriptive statistics such as mean, standard deviation, minimum and maximum through statistical tool SPSS version 23. The study finds out that the control environment of the internal control system is inadequate to be judged as effective, particularly, the organization didn’t continuously provide mentoring and training opportunities needed to attract, develop, and retain appropriate and competent personnel. The study further finds out organization has not sufficiently designed appropriate strategy of identifying risk, no sufficient system designed to respond to risk, lack of monitoring and evaluation system of internal control, The study recommends that monitoring in an effective internal control system is required to continuously evaluate whether the system is performing as per the designed system and the management should establish good internal control environment to control activities on an on-going basis.