THE ROLE OF INTERNAL CONTROLS IN PREVENTING FINANCIAL MISMANAGEMENT IN NONPROFIT ORGANIZATIONS

Dr. Owa. Fredrick CNA; Dr. Onajite Alexandra Akpoveta Ololobou CNA; Onovayen Erus Evelyn

Authors

Dr. Owa Fredrick CNA Accountancy Department, Delta State Polytechnic, Ogwashi-Uku-, Delta State, Nigeria
Dr. Onajite Alexandra Akpoveta Ololobou CNA Accounting Department, Delta State School of Marine Technology Burutu
Onovayen Erus Evelyn School of Transport and Business Studies, Federal Polytechnic Orogun, Delta State

Keywords:

Internal controls, financial mismanagement, Nonprofit organizations, Governance, Accountability and Risk management

Abstract

This paper provides a comprehensive exploration of the importance of internal controls within nonprofit organizations, focusing on their role in safeguarding financial integrity, ensuring accountability, and mitigating the risk of mismanagement. Drawing upon literature review, case studies, and best practices, the study highlights the challenges faced by nonprofits in implementing effective internal controls, including limited resources, volunteer dependence, and a complex regulatory environment. Building upon these insights, the paper offers a set of recommendations aimed at enhancing the effectiveness of internal controls within nonprofit organizations. These recommendations encompass areas such as investing in training and capacity building, leveraging technology solutions, strengthening oversight and governance, prioritizing risk management, engaging stakeholders, and fostering a culture of continuous improvement. By implementing these recommendations, nonprofits can strengthen their internal control frameworks, mitigate risks effectively, and uphold their commitments to accountability, transparency, and responsible stewardship of resources.