Internal Control Systems and Revenue Collection of Level 4 Public Hospitals in Kisii County

Abstract

Purpose: The study aimed to examine the relationship between internal control systems and revenue collection in level 4 public hospitals operating within Kisii County, Kenya.

Material/methods: A descriptive research design was employed. The study targeted a population of 56 employees drawn from key administrative and financial roles, including Accountants, Internal Auditors, Monitoring and Evaluation Officers, and Sub-County Administrators. Primary data were collected using structured questionnaires.

Findings: The analysis established that all components of the internal control system significantly affect revenue collection. Notably, the Control Environment was critical in promoting sound financial management, where effective governance, clear leadership, and ethical standards enhanced revenue collection efficiency. IT Integration emerged as a significant enabler, with the use of automated billing systems, electronic payment platforms, and data management tools contributing to improved transparency, reduced errors, and mitigation of fraud.

Conclusion: Strengthening internal control systems—particularly through improved leadership, enhanced IT infrastructure, and robust monitoring frameworks—can substantially enhance revenue collection in public hospitals. Continuous staff capacity building and adoption of modern financial technologies are necessary to further optimize revenue management.

Value: This study contributes empirical insights into the role of internal controls in healthcare financial management. It provides actionable recommendations for public hospital administrators and policymakers to enhance financial sustainability and operational effectiveness within public health institutions.