Internal Control Practices of Triple A Construction Companies in Metro Manila

Abstract

The study intends to determine the level of effectiveness of internal control practices of Triple A Construction Companies in Metro Manila. The descriptive survey method was used in the study. The researcher gathered the data using survey questionnaires. Frequency and Percentage Distribution, Weighted Mean, One-way Analysis of Variance, Two-way Analysis of Variance, and Ranking were employed as statistical tools. Majority of the Triple A Construction Companies were Partnership, had 1-5 numbers of employees, operating from 11 to 15 years, had a capital of P3,000,001 –P15,000,000, engaged in horizontal-vertical services and publicly listed company. In terms of the assessment of the respondents, the level of effectiveness of internal control of the Triple A construction companies in terms of Organizing People (GM=4.25), Policies and Procedures (GM=4.43), and Processes and Technology (GM=4.45) were assessed as “Very Effective”. When respondents were grouped by number of years in the operation, there were significant differences in terms of policies and procedures as well as processes and technology. In terms of organizing people, there were no significant differences in terms of types of business organization, number of employees, capitalization, classification, and publicly listed. The management should review its manual, financial objectives, identification and assessment of risk related concern in order to have clarity in oversight of the business operations. For other industries, they can use similar internal control policies in order to have an efficient and effective operation of the company. The researcher also recommends the updating of the company’s manual and disseminating it to its employees, to ensure that proper evaluation and implementation are achieved. Further studies should be done involving the five aspects of COSO Framework such as: Control Environment, Risk assessment, Control Activities, Information and Communication, and Monitoring.