Thesis
Primary Author
Elizabeth Wambui Njoroge
Subject Category
Evaluating the role of internal control systems on financial sustainability.
Institutional ID
MIUC-REP-484

Evaluating the role of internal control systems on financial sustainability. A case study of the National Cereals and Produce Board NCPB

College Institutional Repository Academic Archive

Abstract

This study examined the role of internal control systems (ICS) in enhancing financial sustainability
at Kenya’s National Cereals and Produce Board (NCPB). The survey is introduced by the research
problem, highlighting gaps in ICS implementation and their impact on financial resilience and
outlined the study’s objectives, research questions and significance. The main objective of this
study was to examine the role of internal control systems in enhancing the financial sustainability
of the National Cereals and Produce Board (NCPB). The specific objectives of the study were to
evaluate the effect of risk assessment processes on financial sustainability at NCPB, to analyze the
effect of control activities on financial sustainability at NCPB, to assess the effect of information
and communication systems on financial sustainability at NCPB and to determine the effect of
monitoring activities on financial sustainability at NCPB. The study further reviewed empirical
literature and theoretical frameworks, anchoring the study in the COSO (2013) model, Agency
Theory, and Stewardship Theory, while identifying key variables: risk assessment, control
activities, information systems, and monitoring. The research further shows detailed methodology,
employing a descriptive research design with a stratified random sample of 41 NCPB employees.
Data was collected via a 5-point Likert scale questionnaire and analyzed using SPSS (v.26) for
descriptive and inferential statistics. The fourth chapter presented findings, revealing that control
activities and risk assessment were the strongest ICS components, with regression analysis
confirming their significant predictive power (Adjusted R² = 0.473, p < .001). The study concluded
that internal control systems particularly control activities (β = 0.403) and risk assessment (β =
0.312) are critical to NCPB’s financial sustainability. Recommendations included automating
controls, strengthening staff training, and improving monitoring mechanisms. The study
contributes to public sector governance literature by providing actionable insights for agricultural
parastatals in emerging economies.

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