EFFECT OF DISCLOSURE OF FINANCIALS ON FINANCIAL PERFORMANCE OF INTERNAL AUDIT STANDARDS AND FINANCIAL PERFORMANCE OF PUBLIC INSTITUTIONS IN RWANDA. A CASE OF RWANDA SOCIAL SECURITY BOARD
Abstract
internal audit standards at Rwanda Social Security Board, to analyze the financial performance of the Rwanda Social Security Board (RSSB), and to examine the influence of internal audit standards on the financial performance of RSSB. in the methodology section this study employed a mixed-method approach, incorporating both descriptive and correlational research designs with data collection method which used both quantitative and qualitative data by use of interview guide and questionnaire. The target population of this research included 125 dedicated staffs of RSSB within which 95 respondents of the study were selected as the sample size using a modified version of Taro Yamane's formula of sample size determination and with the use of simple random and purposive sampling technique the sample. The collected results followed comprehensive statistical analysis, incorporating measures such as the mean and standard deviation for descriptive insights as well as the correlation for establishing relationship between variables: as results the following were found: To the first specific objective where the effectiveness of internal audit standards was assessed based on independence of internal audit, the competence of internal audit team and the internal control system the following were found: independence of internal audit is done on high level considering the mean of 3.43 which is interpreted as high mean. These findings suggest a generally positive assessment of the internal audit standards at RSSB, with respondents expressing a high level of agreement and satisfaction with the audit function's independence, accessibility, transparency, operational freedom, and freedom from undue pressure, which could potentially contribute to improved financial performance. There is effective competence of audit team, supported by high of 3.65 resulted from four indicators and relatively low standard deviations across all five statements. The internal control system is efficiently conducted considering the grand mean of 3.67 which is interpreted as high mean and the variability in standard deviations suggests that there is some diversity in the respondents' views on these aspects. To the second specific objective, it was found that the financial performance at RSSB is explained by the following: the RSSB has been appreciated by beneficiaries and shareholders considering the mean of 3.74 which is interpreted as high mean, the increase of return on assets for five years considering the mean of 3.67 which is interpreted as high mean, the financial targets set by the institutions were achieved considering the mean of 3.62 which is interpreted as high mean, the projects that were undertaken for self-financial sufficiency have been achieved considering the mean of 3.62 which is interpreted as high mean, and the financial resources have been well allocated and there were no embezzlements considering the mean of 3.77 which is interpreted as high mean. To the third specific objective, it was revealed that there is a positive relationship between independence of internal audit team with financial performance of RSSB considering the Correlation coefficient of 0.622 which is assuming the positive value and this was found to be statistically significant since the p-value of 0.000 is less than 0.01. secondly there is it has positive relationship between competence of internal audit with financial performance of RSSB considering the correlation coefficient of 0.484 which assume a positive value and this was found to be statistically significant considering the p-value of 0.000. Thirdly, it has been found that internal control in this study influence positively the financial performance of RSSB with the correlation coefficient of 0.466 and this was found to be statistically significant considering the p-value of 0.000. In conclusion, this study sheds light on the critical interplay between adherence to internal audit standards and the financial performance of the Rwanda Social Security Board, providing valuable insights for enhancing governance practices and fostering sustained fiscal responsibility in public institutions. Based on the findings of this study, it is recommended that the Rwanda Social Security Board enhances its adherence to established internal audit standards to further bolster financial performance, ensuring robust governance and accountability in the organization. Further studies could explore the longitudinal impact of enhanced internal audit standards on the financial resilience and long-term sustainability of public institutions, such as the Rwanda Social Security Board, considering evolving regulatory landscapes and the dynamic nature of economic environments.
Keywords: Internal Audit Standards, Financial Performance, Public Institutions, Rwanda Social Security Board
CITATION: Muvunyi, N. O., & Osiemo, A. K. (2023). Effect of disclosure of financials on financial performance of internal audit standards and financial performance of public institutions in Rwanda. A case of Rwanda Social Security Board. The Strategic Journal of Business & Change Management, 10 (4), 1151 – 1166. http://dx.doi.org/10.61426/sjbcm.v10i4.2810
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DOI: http://dx.doi.org/10.61426/sjbcm.v10i4.2810
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