i THE IMPACT OF INTERNAL CONTROL SYSTEMS ON OPERATIONAL EFFICIENCY OF SMALL AND MEDIUM ENTERPRISES. A CASE STUDY OF CAPITAL SHOPPERS SUPERMARKET
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Date
2024-09-09
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UGANDA CHRISTIAN UNIVERSITY
Abstract
The study aimed at investigating the impact of internal controls on the operational efficiency
of small and medium enterprises, a case study of Capital Shoppers Supermarket. The study
objectives were to examine the internal control systems used by Capital Shopper’s
Supermarket, to assess the impact of risk assessment on the operational efficiency of Capital
Shoppers Supermarket and to establish the relationship between internal control systems and
the operational efficiency of Capital Shoppers Supermarket.
The study used a cross-sectional research design to relate the variables in the study. The study
population consisted of 83 employees from various departments of the Capital Shoppers
supermarket and a sample of 69 respondents was selected using stratified random sampling
technique. The study used questionnaires as tools for data collection and data was analysed
using the SPSS software. Correlation and regression were also used to analyse the relationship
between the study variables.
The study found out that Capital Shopper's Supermarket utilizes various internal control
systems to safeguard the organization's resources and ensure compliance with regulations such
as physical controls, internal audit departments and segregation of duties, it also found out that
conducting regular risk assessments has been identified as a main way of detecting and
managing potential risks, including those related to supply chain, information technology,
financial management, and regulatory compliance and also found out that there is a strong
positive relationship (0.998) between internal control systems and operational efficiency in
Capital Shopper’s Supermarket.
This study concluded that internal control systems have a positive effect on the operational
efficiency of SMEs through physical control measures, financial control systems, information
technology control systems, internal audits, and segregation of duties being considered
important systems. Regular monitoring and review of internal control systems is necessary for
maintaining effectiveness. The study recommended regular review of internal control systems,
documenting control systems and processes, regular employee training, investing in physical
and information technology control systems, and continuous monitoring of internal control
systems.