To Explore how Enterprise Resource Planning System is Enhancing Internal Financial Control in NGOs: A Case of Cedar Foundation in Mwanza Tanzania

Abstract

The study aims to assess how an organisation deploys ERPs’ availability in ensuring effective internal controls to ensure effective financial decision-making, the importance for organisations to achieve their objectives. To achieve this the study put in place four objectives; to evaluate how management commitments can influence an effective internal control in NGOs, evaluate their effectiveness through the use of an ERP, assess how best operations cycles and procedures can be improved by systems to ensure improved internal controls while understanding the shorting during the implementations. It is believed that the systems have the capabilities of deployment in most major functions of the organisations and therefore ensures faster and accurate decision-making also protect and reduce mismanagements of the donor funds. The study seeks to assess ERPs usefulness to stakeholders in the organisation finances use and coordination The significance of the study is that it can be used by the organisation in making better financial decisions, improve their efficiency and effectiveness and also by the authorities and the professional organisation to improve the reporting. The project will be of significant importance to the NGOs across Tanzania, their management, staff beneficiaries, regulatory authorities such as TRA and the registrar of NGOs, scholars and current and potential donors The study revies pieces of literature such as, the internal control systems, Enter Resource Planning System as a tool of controls, internal control environments and activities and monitoring and controls, Four interlinked theories that are used in the study include, the contingency theory, diffusion theory, System theory of management Diffusion theory and technology acceptance model which is the underpinning theory in the study The research design is the qualitative and exploratory approach. The data collection techniques are interviews both structured and semi-structured and observation while thematic analysis is also used, where purposive sampling is used. The case study is Cedar foundation based in Isamilo, Nyamagana, Mwanza Tanzania where the respondents are interviewed after purposive sampling The study got a 100% response rate during the interview, data were analysed through coding to generate various themes where the study found that ERPs when employed in the organisation helps to fulfil the organisation control needs, establishing the control environment, make it easy to assess risks, creates control ability that can monitor and mitigate risks while ensuring data security while engaging management. Other findings include ease facilitation of the audit process, financial conflict resolution, following of the accounting standards ensuring flexibility and adaptability of the organisation The study recommends that should there be any organisation that is struggling with their internal controls they should consider setting up an ERP system, which should be done after taking into consideration the costs and benefits they will enjoy.