The Impact of Internal Control Systems on Organizational Performance: A Case Study of Buea Police Cooperative Credit Union Limited (BuPCCUL)

Internal control systems (ICS) play a critical role in ensuring the efficiency, integrity, and compliance of an organization. This study investigates the effect of internal control systems on the organizational performance of the Buea Police Cooperative Credit Union Limited (BuPCCUL), Cameroon. Adopting the COSO framework, the research examines how the implementation, effectiveness, and compliance of internal control systems influence various performance metrics, including financial reporting accuracy, risk management, fraud prevention, decision-making, and stakeholder trust. The methodology included a structured questionnaire distributed to 50 employees across BuPCCUL branches, analyzed using descriptive statistics. Results indicate a strong positive correlation between ICS and organizational performance. Descriptive analysis revealed that 100% of respondents acknowledged that ICS improve financial reporting accuracy, fraud prevention, and risk management. Additionally, 98% agreed that compliance with ICS enhances performance, and 68% strongly agreed that effective ICS led to measurable improvements in BuPCCUL’s operations. There was a strong positive linear correlation between the availability of internal audit or internal control within BuPCCUL and improvement in organizational performance (r = 0.731), identifying areas of strength and weakness to compliance to internal control (r = 0.682) and identification areas of improvement within BuPCCUL (r = 0.705). The study underscores the importance of periodic audits, effective policy frameworks, and staff accountability. Emphasis on capacity building, technological investment in control tools, and continuous monitoring for improved governance are recommended. These findings contribute to the growing literature advocating the integration of internal control systems as a strategic tool for sustainable organizational success.