THE INTERRELATIONSHIP BETWEEN CORPORATE GOVERNANCE, INTERNAL CONTROL SYSTEMS, AND FINANCIAL DISCIPLINE IN STATE-OWNED TRANSPORT ENTERPRISES

This article examines the interrelationship between corporate governance, internal control systems, and financial discipline in state-owned transport enterprises using a systems-based integrative approach. The study synthesizes the COSO Internal Control–Integrated Framework, the Institute of Internal Auditors (IIA) Three Lines Model, and empirical research on internal control deficiencies. Internal control is conceptualized as a mechanism through which corporate governance decisions influence financial performance and discipline. The components of the COSO framework are aligned with key risk areas in transport enterprises, including procurement, maintenance, revenue collection, and financial reporting. The study proposes a financial discipline index comprising four indicators: budget execution deviations, the proportion of overdue accounts payable, the rate of resolution of audit findings, and compliance with reporting deadlines. Threshold values are established for each indicator. The data required to calculate the proposed index are identified within existing management reports and the internal audit findings register. Furthermore, a three-line control structure involving the supervisory board and audit committee is developed, and practical recommendations for its implementation are presented.