Internal Control Process and Organizational Performance of Selected Deposit Money Banks in Nigeria

Abstract

This study investigated the relationship between internal control process and organizational financial and non-financial performance of selected deposit money banks in Nigeria. with specific objectives of determining the effect of risk assessment and monitoring activities the performance of DMBs in Nigeria. Primary data was collected using questionnaires administered to top level employees and other employees of 11 banks using a purposive random sample of 150 respondents out of which 97 responses were collected. The data were analyzed using descriptive statistics, correlation analysis, exploratory factor analysis and regression with aid of Statistical Package for Social Sciences (SPSS) version 26. The result of the analysis shows that risk assessment risk assessment practice has a positive impact on the performance of deposit money banks in Nigeria (B= 0.390, t= 4.019, p < 0.01) and that monitoring activities have a positive impact on the performance of deposit money banks in Nigeria (B= 0.415, t= 4.019, p < 0.01) Each has a positive and significant impact on financial, non financial and overall organizational performance DMBs in Nigeria. Based on the findings, it is concluded that internal control mechanism is a significant predictor of organization financial and non-financial performance and that effective internal control systems must incorporate the effects of risk assessment and control activities to enhance organizational performance of DMBs. The study therefore recommended that internal control systems especially risk assessment and monitoring activities are significant areas and management of DMBs in Nigeria should give great attention to them in order to improve organizational performance.