Administrative internal control system and performance effect: Focus on telecommunication industry in South-South and South-East Nigeria

Odita Anthony O; Daniels Christopher; Obire Jennifer; Eneh Chinedu

doi:10.21744/lingcure.v6nS1.1997

Authors

Odita Anthony O
tonyodita2002@gmail.com
Department of Business Administration and Marketing, Faculty of Management Sciences, Delta State University, Abraka Delta State, Nigeria
Daniels Christopher Department of Business Administration and Marketing, Faculty of Management Sciences, Delta State University, Abraka Delta State, Nigeria
Obire Jennifer Department of Business Administration and Marketing, Faculty of Management Sciences, Delta State University, Abraka Delta State, Nigeria
Eneh Chinedu Department of Business Administration and Marketing, Faculty of Management Sciences, Delta State University, Abraka Delta State, Nigeria

Keywords:

administrative internal, control system, financial performance, performance effect, telecommunication industry

Abstract

The study focused on effect of admin internal control on performance in telecommunications industry in South South and South East Nigeria. The study employed a descriptive survey research design. Instrument adopted for the study is a structured questionnaire based on simple random sampling method. In addition, interview was also employed to serve as a compliment for the questionnaire. Reliability of the research instrument was tested using the Cronbach Alpha method which revealed that the instrument is reliable. The result of Durbin Watson revealed that the data is free from autocorrelation. Data analysis was done using both descriptive and inferential analysis technique. Descriptive statistics was used to give insight on the respondents profile while inferential statistics was used in the conducting of hypotheses. The five research questions for the study were analyzed using multiple regression model. The study shows that the five null hypotheses were rejected while the five alternative hypotheses were accepted (organization’s internal control environment (p=0.000<0.05, ?=0.890); risk assessment (p=0.000<0.05, ?=0.242); control activities (p=0.001<0.05, ?=0.092); information and communication (p=0.000<0.05, ?=0.115); monitoring (p=0.000<0.05, ?=0.307)). The study concluded that organization’s internal control environment, risk assessment, control activities, information and communication, and monitoring aid and has a positive influence on organizational performance.

Downloads

Download data is not yet available.

References

Abernethy, M. A., & Lillis, A. M. (1995). The impact of manufacturing flexibility on management control system design. Accounting, Organizations and Society, 20(4), 241-258. https://doi.org/10.1016/0361-3682(94)E0014-L

Adebanjo, D., Ojadi, F., Laosirihongthong, T., & Tickle, M. (2013). A case study of supplier selection in developing economies: a perspective on institutional theory and corporate social responsibility. Supply Chain Management: An International Journal.

Adinkrah, M., & Adinkrah, H. A. (2021). Focalizing Chinua Achebe’s no longer at ease: mitigating and aggravating factors in Obi Okonkwo’s corruption scandal. International Journal of Linguistics, Literature and Culture, 7(5), 371-380. https://doi.org/10.21744/ijllc.v7n5.1011

Amin, A., Al-Obeidat, F., Shah, B., Adnan, A., Loo, J., & Anwar, S. (2019). Customer churn prediction in telecommunication industry using data certainty. Journal of Business Research, 94, 290-301. https://doi.org/10.1016/j.jbusres.2018.03.003

Anantadjaya, S. P., Nawangwulan, I. M., Irhamsyah, M., & Carmelita, P. W. (2021). Supply chain management, inventory management & financial performance: evidence from manufacturing firms. Linguistics and Culture Review, 5(S1), 781-794. https://doi.org/10.21744/lingcure.v5nS1.1463

Ayyash, M. Y. (2017). The impact of internal control requirements on profitability of Palestinian shareholding companies Palestinian Banking Sector.

Badara, M. (2013). Impact of the effective internal control system on the internal audit effectiveness at local government level. Journal of Social and Development Sciences, 4(1), 16-23.

Bernard, A. B., & Jensen, J. B. (1999). Exceptional exporter performance: cause, effect, or both?. Journal of international economics, 47(1), 1-25. https://doi.org/10.1016/S0022-1996(98)00027-0

Bongani, N. (2013). Application of internal controls in NGOs: Evidence from Zimbabwe. Journal of Finance and Accounting, 1(2), 39-47.

Chinaemerem, O. C., & Anthony, O. (2012). Impact of capital structure on the financial performance of Nigerian firms. Oman Chapter of Arabian Journal of Business and Management Review, 34(969), 1-19.

Committee of Sponsoring Organisations (COSO) framework, (2013). Internal Control — Integrated Framework: Internal Control over Financial Reporting: A Compendium of Approaches and Examples (Exposure draft).

Davis, S., & Albright, T. (2004). An investigation of the effect of balanced scorecard implementation on financial performance. Management accounting research, 15(2), 135-153. https://doi.org/10.1016/j.mar.2003.11.001

Ehiedu, V. C., Odita, A. O., & Kifordu, A. A. (2020). Financial Integration and Growth Volatility Nexus: The Nigeria Experience. Webology, 17(2).

Fadzil, F. H., Haron, H., & Jantan, M. (2005). Internal auditing practices and internal control system. Managerial Auditing Journal.

Frazer, L. (2012). The effect of internal control on the operating activities of small restaurants. Journal of Business & Economics Research (JBER), 10(6), 361-374.

Gamage, C. T., Lock, K. L., & Fernando, A. A. J. (2014). A proposed research framework: Effectiveness of internal control system in state commercial banks in Sri Lanka. International Journal of scientific research and innovative technology, 1(5), 25-44.

Guijarro, R., Montes, J., Sanromán, C., Monreal, M., & RIETE investigators. (2008). Venous thromboembolism in Spain. Comparison between an administrative database and the RIETE registry. European journal of internal medicine, 19(6), 443-446. https://doi.org/10.1016/j.ejim.2007.06.026

Hayali, A., Dinç, Y., Sar?l?, S., Dizman, A. S., & Gündo?du, A. (2012). Importance of internal control system in banking sector: Evidence from Turkey. In Conference Proceedings of the Finance and Economics Conference.

Houndjo, T. (2018). The fulfillment of the biblical statement “vanity of vanities! all is vanity” through the portrayal of two characters in Armah’s the beautyful ones are not yet born. International Journal of Linguistics, Literature and Culture, 4(6), 28-41. https://doi.org/10.21744/ijllc.v4n6.339

Jacob, E.O. and Philip, A.O. (2016).Journal of Business and Management, 18(10), 80-85.

James, U. M., Godwin, E.I., Ojo, V. O. (2014). Internal Controls And Operating Performance Of Small Businesses In Lagos Metropolis. Accountability & Sustainable Business Development in Emerging Economies.

Kirsch, L. J. (2002). Developing Common System Globally: The Dynamics of Control Infrastructure. Information Systems Research, (15,154-167).

Kustina, K.T., Dewi, G.A.A.O., Prena, G.D., Suryasa, W. (2019). Branchless banking, third-party funds, and profitability evidence reference to banking sector in indonesia. Journal of Advanced Research in Dynamical and Control Systems, 11(2), 290-299.

Mahoney, L., & Roberts, R. W. (2007). Corporate social performance, financial performance and institutional ownership in Canadian firms. In Accounting forum (Vol. 31, No. 3, pp. 233-253). No longer published by Elsevier. https://doi.org/10.1016/j.accfor.2007.05.001

Malhotra, P., & Singh, B. (2007). Determinants of internet banking adoption by banks in India. Internet Research.

Mirchandani, P., & Head, L. (2001). A real-time traffic signal control system: architecture, algorithms, and analysis. Transportation Research Part C: Emerging Technologies, 9(6), 415-432. https://doi.org/10.1016/S0968-090X(00)00047-4

Mirinaviciene, S. (2014). Internal control and fraud prevention: Prior research analysis. Science and studies of accounting and finance: problems and perspectives, 2014, vol. 9, no. 1, p. 173-179.

Monday, J. U., Inneh, G. E., & Ojo, V. O. (2014). Internal controls and operating performance of small businesses in Lagos Metropolis. In International Conference on Accounting, Finance and Management, March (pp. 237-256).

Muriuki, M. N. (2017). Effects Of Internal Controls On The Performance Of Multinational Financial Services Companies In Kenya (Doctoral dissertation, University of Nairobi).

Mwangi, G. N. (2012). The effect of credit risk management on the financial performance of commercial banks in Kenya (Doctoral dissertation).

Odita, A. O., & Bello, A. (2015). Strategic Intent and Organizational Performance A Study of Banks in Asaba, Delta State Nigeria. In Information and Knowledge Management (Vol. 5, No. 4, pp. 60-71).

Odita, A.O. (2021). Organizational Culture and Implications on Workers’ Commitment: An Applied Study of Breweries in Nigeria, Nigerian Journal of Management, Faculty of Mgmt. Sciences, Rivers State University, 22(2), 84-105.

Oghomeh, T. & Odita A.O (2013). Entrepreneur’s Nightmare – Corporate Failure: Consequences and Probable Solutions, Research Journal of Finance and Accounting, International Institute of Science, Technology and Education, IISTE, 4(19), 45-52.

Oppong, M., Owiredu, A., Abedana, V., & Asante, E. (2016). The impact of internal control on the performance of faith-based NGOs in Accra. Available at SSRN 2803451.

Owczarczuk, M. (2010). Churn models for prepaid customers in the cellular telecommunication industry using large data marts. Expert Systems with Applications, 37(6), 4710-4712. https://doi.org/10.1016/j.eswa.2009.11.083

Saeidi, P., Shokoohi, M, Malekmahmoudi, S. K. (2015). Investigating the relation between internal control system and financial performance of telecommunication company of Golestan province, Multidisciplinary International Peer Reviewed Journal, 3(2), 206-211,

Singleton, T. W, Bologna, G. J, Lindquist, R. J., & Singleton, A. J. (2016). Fraud auditing and forensic accounting (Third Edition). New Jersey: John Wiley & Sons, Inc.

Tabachnick, B. G., & Fidell, L. S. (2014). Using multivariate statistics . Harlow. Essex: Pearson Education Limited.

Umar, H., & Dikko, M. U. (2018). The effect of internal control on performance of commercial banks in Nigeria. International Journal of Management Research, 8(6), 13-32.

van Walraven, C., & Austin, P. (2012). Administrative database research has unique characteristics that can risk biased results. Journal of clinical epidemiology, 65(2), 126-131. https://doi.org/10.1016/j.jclinepi.2011.08.002

Zahra, S. A., & Garvis, D. M. (2000). International corporate entrepreneurship and firm performance: The moderating effect of international environmental hostility. Journal of business venturing, 15(5-6), 469-492. https://doi.org/10.1016/S0883-9026(99)00036-1

Zainudin, B., Sutawidjaya, A. H., Saluy, A. B., Djamil, M., & Endri, E. (2021). The effect of compensation, leadership, and supervision on performance of government civil servants: Mediating role of adversity quotient. Linguistics and Culture Review, 5(1), 453-469. https://doi.org/10.21744/lingcure.v5n1.1988