INTERNAL CONTROLS AND FINANCIAL PERFORMANCE OF COMMERCIAL STATE CORPORATIONS IN KENYA

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Published Nov 12, 2025
DOI https://doi.org/10.61426/business.v6i1.444

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PURITY MURONGOLE AMUDAVI
MBA Student, School of Business and Entrepreneurship, Jomo Kenyatta University of Agriculture and Technology, Kenya
MOSES WEKESA, PhD
Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya

Abstract

The purpose of the study was to determine the internal controls and financial performance of commercial state corporations in Kenya. The study adopted cross-sectional descriptive survey research design. Primary data was collected by use of structured questionnaires while Secondary data was collected from performance reports and relevant documents using secondary data collection sheet. The study conducted pilot test before data collection to test reliability and validity of data collection instruments. The collected data was analysed, summarized and tabulated by use of SPSS software version 29. Descriptive analysis and inferential analysis was used to summarize the results for each of the study objectives. The results revealed that all four internal control variables; internal auditing, documents and records, communication systems, and transaction authorization have a statistically significant positive effect on the financial performance of commercial state corporations in Kenya, with communication systems showing the strongest influence per unit change. The results revealed that all four internal control variables—internal auditing, documents and records, communication systems, and transaction authorization—have a statistically significant positive effect on the financial performance of commercial state corporations in Kenya, with communication systems showing the strongest influence per unit change. The study concludes that internal controls play a critical role in enhancing financial performance in commercial state corporations. Strengthening internal auditing practices, improving record management, enhancing communication systems, and reinforcing transaction authorization frameworks are essential for improving financial outcomes. The study recommended that commercial state corporations invest in capacity building for audit teams, adopt modern accounting systems, improve information system integrity and communication clarity, and enforce robust transaction authorization policies. Further research is recommended to explore additional internal control variables and extend the scope to other public sector and private entities in Kenya.

Article Details

Issue
Vol 6 No 1 (2025)
Section
Articles
Author Biographies

PURITY MURONGOLE AMUDAVI, MBA Student, School of Business and Entrepreneurship, Jomo Kenyatta University of Agriculture and Technology, Kenya

MBA Student, School of Business and Entrepreneurship, Jomo Kenyatta University of Agriculture and Technology, Kenya

MOSES WEKESA, PhD, Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya

Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya

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