Internal Control Effectiveness and Business Survival of Listed Firms in Nigeria: The Moderating Role of Leadership Consistency and Quality

Internal control structure describes the capability of a firm’s risk management structure and is an indispensible element in modern governance structure. Therefore, this study explores internal control effectiveness on business survival of listed firms in Nigeria and the moderating influence of leadership consistency and quality. The study used cross sectional research design and data were collected from primary and secondary sources. The primary data consisted of structured questionnaires from a sample of 546 respondents of listed firms in Nigeria. Data collected from the respective respondents were analysed by applying structural equation model. The study shows that there is a positive and significant relationship between internal control effectiveness (control environment, risk assessment, control activities, information and communication and monitoring) on business survival, measured by productivity improvement. The finding also shows that leadership consistency and quality moderates positive and significant association between internal control effectiveness and business survival of listed firms in Nigeria. From the findings of this study, we concluded that leadership consistency and quality positively and significantly influence the relationship between internal control effectiveness and business survival of firms in Nigeria. We recommended amongst others that firms listed on the Nigeria Exchange Group (NGX) should improve on internal control practices by optimizing internal structure and improve the communication between various departments through the cultivation of corporate culture and the institutionalization of realistic incentive schemes that contributes to the advancement of productivity improvement, corporate development and constantly increasing the value of the firm.