Effect Of Weak Internal Control System On The Profitability Of Small Sale Enterprises (A Study Of Abia Farm)

ABSTRACT

The main aim of this work was to analyze the effect of week internal control system on the profitability of small scale enterprises with special focus on Abia farms, in undertaking the above aim, available literatures on the area of the study were reviewed. Questionnaires were used to obtain data from respondents. The total population for the study was 65; while the sample, size is 56. 48 out of 56 questionnaires distributed by the researcher were returned. The statistical techniques used for the analyses of data and hypotheses testing were simple percentage and Chi-square (x) test respectively. The findings established include weak internal control system negatiyely affect the profitability of small scale enterprises; weak internal control system has negative impact on the management performance of small scale enterprises. Going by the above findings, the following recommendations were made; assets and properties of the organization should be protected through the institution of efficient internal control, weak internal control system should not be allowed to exist because it causes poor management decision, encourages fraud and defalcation, management inefficiency and it impacts negatively on the profit of the organization.