Church size, staff competency, social capital and the quality of financial reporting: acase of selected churches in Uganda.

Abstract

There is uncertainty regarding the quality of financial reporting in many churches in Uganda. Most churches experience difficulty in presenting financial reports that reflect the financial condition and results of operation in rational and meaningful manner. More than often, it is wondered how much information is enough or which information is important. The study was undertaken with a purpose of examining the relationship between church size, staff competencies and social capital on one hand as independent constructs and quality of financial reporting on the other as the dependent construct. It was a cross-sectional study with quantitative methods of data collection that was conducted in Mukono district. Stratified sampling was used to select 148 churches representing each church category from a population of 247. Data was collected using a pre-tested self-administered questionnaire. It was observed that church size, social capital and competencies explain 46.8% of the observed variance of quality of financial reporting (Adjusted R Square = 0.468). Study findings revealed positive correlation between the independent constructs and quality of financial reporting, with church size being the strongest (r=0.591), followed by staff competencies (r=0.432,) and then social capital (r=0.318). This indicates that church size, staff competency and social capital boost quality of financial reporting in churches.