Reducing the Risk of Fraud in Ugandan Churches

Date
2013-05-18
Authors
Jurado, Kaila
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Worldwide access.
Access changed 8/25/15.
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Abstract

While many organizations are susceptible to fraud, there is evidence that churches are especially vulnerable. Unfortunately, most fraud prevention suggestions are not tailored to churches in developing countries. This paper focuses on fraud in Ugandan churches. My main question is whether any observable features in Ugandan churches are associated with accounting practices that reduce the likelihood of fraud. If not, then explicit foreign instruction may be necessary. To answer my question, I collect an original dataset surveying Ugandan pastors and students. I introduce a new summary measure of internal controls, called the Internal Control Index, based on best practices described in accounting literature. Using this measure, I find that none of the characteristics observed, such as theological views, pastor and accountant experience, or denominational affiliation, are systematically associated with anti-fraud accounting practices. This suggests that direct foreign instruction may be necessary to reduce the risk of fraud in these churches.

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Keywords
Uganda., Fraud., Church., Internal Controls.
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