Measuring the Level of Awareness of COSO Internal Control Standards in Metropolitan Municipalities in Turkey

Abstract

Internal control is a management control built by managers to achieve organizational goals and ensure sustainability. COSO (Committee of Sponsoring Organizations), consisting of five independent organizations in the USA (United States of America), pioneered the internal control system to become a standard structure. COSO's internal control model covers five primary dimensions: control environment, risk assessment and management, control activities, information and communication, and monitoring. Through these five closely related dimensions, it serves to ensure organizational effectiveness by building an orderly system. It is a structure developed for organizations to manage the risks they encounter successfully and ensure the sustainability of organizational processes. In this way, organizations provide advantages such as reducing risks, increasing the reliability of financial statements, and becoming more compliant with the laws and regulations that must be complied with. It is essential to know about these standards and their implementation for organizations. Implementing these standards in the public sector is also noteworthy, and it has especially come to the fore in the activities of metropolitan municipalities. This research aims to determine the level of awareness of COSO internal control standards in metropolitan municipalities in Turkey. The general secretary, deputy general secretaries, and authorized persons in strategic planning and financial services (N = 149) working in 30 metropolitan municipalities in Turkey participated in the research. The sample group comprises officials selected by the purposive sampling method. Data were obtained by online survey. Frequency analysis, analysis of descriptive statistics, tests to examine differences, and correlation analysis was used in the data analysis. According to the findings, it has been determined that the efficiency of the COSO internal control standards in metropolitan municipalities is almost at the expected level. A strong correlation was obtained between the structures comprising the COSO internal control standards. The findings are discussed from a theoretical and practical point of view. Then, various suggestions are presented for decision-makers and future research.