Procurement internal control systems and cost-effectiveness in force account construction projects

Abstract

Public organisations consistently face challenges in achieving cost-effectiveness in construction projects, and this issue remains a global concern. In response to this issue, the present study examines the role of procurement internal control systems on cost-effectiveness in force account (FA) construction projects in local government authorities (LGAs). A cross-sectional research design with a sample size of 318 respondents from selected LGAs in Dodoma, Tanzania was used. Data were collected using a structured questionnaire and analysed using covariance-based structural equation modelling. The findings revealed that attributes of procurement internal control systems that include stock control (β = 0.165, p < 0.015), record keeping (β = 0.355, p < 0.001), authorisation process (β = 0.233, p < 0.002), have significant and positive relationships with cost-effectiveness in FA construction projects. The study’s findings failed to confirm the significant link between the segregation of duties and the cost-effectiveness in FA construction projects (β = 0.094, p < 0.095). These results imply that among the considered procurement internal control systems; segregation of duties does not significantly matter in explaining cost-effectiveness in FA construction projects in LGAs. The study was limited by its geographical context. Therefore, the generalisation of findings should be done with caution because the study relied on the evidence from FA construction projects in primary schools within LGAs in Tanzania. This study provides valuable practical insights for procurement practitioners and members of the FA committee in the public sector. It guides the adherence to the procurement internal control systems to enhance the cost-effectiveness in construction projects.

Keywords

• Construction projects
• Cost-effectiveness
• Force account
• Local government
• Internal control systems