Intensity of Innovation: mediator of Internal Control Systems and Financial Accountability

Abstract

Purpose: This paper examined the mediating effect of the intensity of innovation in the relationship between internal control systems and financial accountability of higher local governments in South-Western Uganda. The purpose of this paper was to establish the mediating role of the intensity of innovations in the association between internal control systems and financial accountability. Design/methodology/approach:The paper employed the Medgraph program and the Kenny and Baron approach to test for mediation effects. Findings: It is crystal clear that the factual drivers of financial accountability in higher local governments are the intensity of innovation and internal control systems. However, the intensity of innovation exhibits a partial form of mediation in the relationship between internal control systems and financial accountability. Study implications: Since the intensity of innovation depicted a causal chain in the relation between internal control systems and financial accountability in this study, the management of higher local governments should aim to enhance the agents of intensity of innovation, i.e., innovative input, innovative process, and innovative output, since effective financial accountability is driven by effective governance mechanisms and financial management practices. Study limitations: A quantitative research approach was adopted in this study. Based on the limitations linked to this research approach, future research could be conducted through interviews to triangulate. Originality/value: This is the first study that focuses on testing the mediating effect of intensity of innovation in the relationship between internal control systems and financial accountability in the Uganda Higher local government sector.