The Effect of Segregation of Duty on Financial Performance in Commercial Banks in Uganda: A Case of Centenary Bank Kabale Branch

This study examined the effect of segregation of duties on the financial performance of commercial banks in Uganda, focusing on Centenary Bank Kabale Branch. The study adopted a cross-sectional survey research design involving both quantitative and qualitative approaches. Data were collected from 159 respondents and analysed using descriptive statistics, Pearson correlation analysis, and linear regression models. Descriptive analysis was presented using frequency tables to explain the characteristics of the variables under study. Pearson correlation analysis was conducted at the bivariate level to establish the relationship between segregation of duties and financial performance, while regression analysis was used to determine the magnitude of the effect. The findings revealed that segregation of duties significantly and positively influenced the financial performance of commercial banks, with the regression results indicating a strong relationship (R² = 0.825, p < 0.01). Both quantitative and qualitative findings showed that effective segregation of duties strengthens accountability, minimizes fraud and operational errors, and improves organizational efficiency. The study concluded that strong internal control mechanisms are essential for enhancing financial performance in commercial banks. The study therefore recommends that commercial banks strengthen internal controls by clearly defining staff roles and responsibilities, conducting regular staff training on ethical practices and internal controls, and adopting digital monitoring and audit systems for real-time transaction supervision. Regular independent audits and management oversight are also necessary to promote transparency, accountability, and sustainable financial performance.

Segregation of Duty, Financial Performance, Commercial Banks in Uganda and Centenary Bank Kabale Branch.

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