The Accountability Architecture: Linking Robust Financial Controls to Institutional Advancement in the NGO Sector
DOI:
https://doi.org/10.47941/ijecop.4000Keywords:
Internal Financial Controls, Institutional Development, NGO Governance, East Africa, Fiscal Accountability, Organizational Maturity, Risk Mitigation and Financial OversightAbstract
Purpose: This study investigates the effect of financial controls on the institutional development of non-governmental organizations (NGOs) across Kenya, Uganda, Tanzania, and South Sudan during 2015–2021.
Methodology: A concurrent mixed-methods approach was employed. We collected quantitative data through a cross-sectional survey of 476 respondents from 28 NGOs (94.4% response rate). We analyzed the data using descriptive statistics, Pearson correlation, multiple regression, and ANOVA. The qualitative component consisted of 48 in-depth interviews, analyzed through thematic analysis.
Findings: Financial control components collectively accounted for 55.5% of the variance in institutional development (R² = 0.555, F = 196.234, p < 0.001), representing the strongest explanatory power among financial economics dimensions. Internal control systems emerged as the most significant predictor (β = 0.298, p < 0.001), followed by resource utilization (β = 0.256, p < 0.001), governance oversight (β = 0.198, p = 0.001), and risk management integration (β = 0.167, p = 0.004). Qualitative insights revealed an evolution of financial controls from fraud prevention mechanisms to comprehensive integrity systems.
Unique Contribution to Theory, Policy, and Practice: The study shows that financial controls are not merely technical accounting tools but the bedrock of institutional viability for NGOs. Practically, NGOs should prioritize robust internal controls as the cornerstone of organizational development. For policy, the findings underscore the need for donors to invest in building financial control capacities and for policymakers to implement sector-wide transparency standards, thus supporting sustainable NGO development in East Africa.
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Copyright (c) 2026 Kenneth Nyesige, Akashraj Devanga Pruthviraj, Abraham Kuol Nyuon
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