INTERDEPENDENCE OF CONTROL ACTIVITIES AND MONITORING AS COMPONENTS OF THE INTERNAL CONTROL SYSTEM OF MANUFACTURING COMPANIES IN THE REPUBLIC OF SERBIA

Abstract

The subject of research in this paper is control activities and monitoring as components of the internal control system in manufacturing companies in the Republic of Serbia. The aim of this paper is to determine not only interdependence of control activities and monitoring, but also the interdependence of these components of the internal control system with indicators of ROA and ROE of a company. An additional goal of this paper is to examine the existence of differences in the assessment of the importance of control activities and monitoring applicable in manufacturing companies of different sizes. The research included a sample of manufacturing companies operating in the Republic of Serbia. The analysis was performed in the SPSS statistical program, where a correlation analysis was performed using the Pearson Coefficient, as well as the Kruskal-Wallis H test and the Mann-Whitney U test. The obtained results showed the existence of a strong positive link between control activities and monitoring, as well as weak links between control activities and monitoring, on one hand, and ROA and ROE indicators of the company, on the other hand. In addition, the results confirmed that there is no difference in the importance of the application of internal control systems, i.e. control activities and monitoring, in manufacturing companies of different sizes.