Reporting Structures and Financial Efficiency among Selected County Governments

Psirmoi Chebasa Mercy


Internal auditors face several obstacles including limited of independence, limited access to records as well as support and recognition by the management. The importance of internal auditing within the county government is underscored by noted irregularities including records inaccessibility, poor reporting structures and even incompetence of internal auditors within the county government expenditure. Therefore, the focus of this study was to examine the influence of internal audit independence on the financial efficiency of selected county governments.  The study was guided by the specific objectives of; to evaluate the influence of reporting structure on the financial efficiency of selected county governments. The study targeted 423 respondents from the 9 county Audit Committee members of the 47 county governments in Kenya. The researcher sampled 126 respondents from the 14 (30% of the 47 targeted population of counties) counties which was purposively sampled regionally. Purposive sampling technique was used to get the 14 county governments. The survey involved collecting information by administering questionnaires. Data collected was descriptively analyzed using SPSS.  Results was summarized using tables and presented in form of pie charts, graphs, and bar charts. The means of reporting structures and Financial Efficiency of County Governments were regressed. Findings revealed that the relationship of reporting structures and Financial Efficiency of County Governments variables which was linear, positive and significant. The correlation coefficient (R) of 0.470 implied a relatively weak relationship of reporting structures and Financial Efficiency of County Governments. The coefficient of determination, R-square of 0.221 implied that 22.1% of the variance in Financial Efficiency of County Governments was accounted for by reporting structures with the significance value of p = 0.000 which is less than 0.05. This findings will be of use in policy formulation, industry practice and research.

Keywords: Reporting Structures, Financial efficiency, Internal audit independence 

DOI: 10.7176/RJFA/10-19-02

Publication date:October 31st 2019

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