INTERNAL CONTROL AND FINANCIAL PERFORMANCE OF LISTED DEPOSIT MONEY BANKS IN NIGERIA: AN ANALYTICAL REVIEW

This study aimed at investigating internal control and financial performance of deposit money banks in Nigeria. This was motivated by the desire to learn how internal control enhances effective financial performance in the wake of the widespread corporate failures in Nigeria and the rest of the world. Control Environment, Risk Assessment, Control Activities, Information and Communication
vis-a-vis Monitoring were represented by internal control while Return on Assets was used to represent financial performance. The study used census sampling technique to extract data from the annual reports of 13 deposit money banks listed on the Nigerian Exchange Group as of December 31st, 2018. Secondary data were gathered for the study. The study's seven-year time frame was from 2012 to 2018. Descriptive and inferential statistics were used to examine the data specifically through regression analysis. The outcome of the data analysis showed that Control Environment, Risk Assessment, Control Activities, and Information and
Communication significantly influence the financial performance of deposit money banks in Nigeria. This implies that, Control Environment, Risk Assessment, Control Activities and Information and Communication put in place by banks influences at most 22.3%, -35.4%, 94.7% and 19.7% of the profit generated by the banks but monitoring insignificantly influence the financial performance of banks by 15.2% in Nigeria. As a result, it is advised, that Management of deposit money banks should maintain sound control environmental approach to internal control due to the riskiness of banking business and its impact on the economic growth of the country. Management should ensure that banks have an independent board of directors and audit committee as a corporate governance regulatory requirement in order to keep assessing the riskiness of their businesses.