MUNIALO FAITH2024-12-022024-12-022024-08-31https://hdl.handle.net/20.500.12311/2383This research report was undertaken to examine accounting practices and financial performance of ministry of water and environment Mbale branch. It was guided by three objectives; to analyze the effect of accrual accounting on financial performance of ministry of water and environment Mbale branch, to assess the effect of cash accounting on financial performance of ministry of water and environment Mbale branch, to examine the effect of internal control on financial performance of ministry of water and environment Mbale branch. The researcher used a sample size of 45 respondents and used questionnaires and interview guide to collect data and later the data was analyzed using the statistical package for social sciences (SPSS). Results of the first objective showed that accrual accounting has a significant effect on financial performance of ministry of water and environment Mbale branch. Supported by the following responses; 80% were positive to the statement that respondents record revenue when it's earned, not when cash is received; 66.6% who were also the majority were positive to the statement that respondents match expenses with related revenues to accurately report profitability. Results of the second objective revealed that cash accounting has a significant effect on financial performance of ministry of water and environment Mbale branch. Supported by the following responses; 66.7% of the respondents were positive to the statement that respect record revenue only when you receive cash, 66.6% forming the majority were positive to the statement that respondents record expenses only when you pay cash, it can be observed that 64.5% were positive to the statement that respondents find cash accounting simpler because it involves fewer transactions to track. Results of the third objective showed that internal control has a significant effect on financial performance of ministry of water and environment Mbale branch. 55.5% had a positive response to the statement that respondents enhance compliance with legal and regulatory requirements with proper internal controls. There is need for ministry of water and environment Mbale branch to implement comprehensive training programs for staff to ensure accurate and consistent application of accrual principles. This includes the recognition of revenues and expenses when they are earned or incurred, rather than when cash is received or paid, which provides a more accurate reflection of a company’s financial position.enThesis