The impact of a coso-based internal control system on financial and non-financial performance: The case of listed commercial banks in Ghana

Abstract

This study aimed to examine the impact of the internal control system on the performance of publicly traded commercial banks in Ghana, within the context of the core components of the COSO internal control model. Accordingly, the study investigated employees' perceptions of the impact of the internal control system components on financial and non-financial performance and whether a significant relationship exists between these perceptions. In the study, the core components of the COSO internal control system (Control Environment, Risk Assessment, Control Activities, Information- Communication, Monitoring) were considered as independent variables, while firm performance (financial%non-financial) was considered as the dependent variable. Methodologically, a descriptive online survey method was used to collect data. The survey was sent to a group of 113 managers&employees working in the internal control&audit departments of 23 publicly traded commercial banks in Ghana, and responses were received from 73 employees representing a 65% participation rate. Data were analyzed using SPSS-25. The survey, which was suitable for a 5-point Likert scale, included statements regarding the core internal control components of COSO and financial&non-financial performance. The study concluded that there is a significant and positive relationship between the components of the internal control system and financial and non-financial performance. The study revealed that the internal control system has a positive impact on the bank's financial and non-financial performance. This study is considered to contribute to the literature by examining public banks in Ghana, the employees in the internal control and audit departments of banks and branches, and the impact of the internal control system on financial and non-financial performance based on COSO’s core components. The study is limited by the type of banks chosen, the number of participants, the survey questions and answers, the statistical analysis method, and the tests used.