Impact of Audit Work on Corporate Governance and Performance of Business: A Case of Cimerwa Plc/ Musanze Plant
Victorine Nyirabanani & Kato Mahazi
University of Kigali, Rwanda
https://orcid.org/0009-0003-5653-2348
Email: victorine0125@gmail.com
Abstract: This study examines the impact of audit work on corporate governance and business performance in Musanze District, focusing on the CIMERWA PLC/Musanze Plant between 2021 and 2023. Data was analyzed using descriptive and inferential techniques to assess the relationships between audit activities and business performance. The results show that audit work significantly enhances accountability, transparency, and regulatory adherence, improving financial performance, risk management, and investor confidence. Furthermore, the frequency of audits plays a crucial role in organizational stability, with a moderate positive effect observed between audit frequency and financial stability (R = 0.482, p < 0.05). Audit quality emerged as a critical driver of operational performance, with a correlation of R = 0.440, highlighting the importance of high-quality audits in improving operational efficiency and resource allocation. Audit follow-ups also positively impacted operational performance, with a regression analysis revealing that follow-up actions contributed to a 0.674 unit improvement in performance (β = 0.674, p = 0.000). Lastly, clarity in audit reporting was shown to positively influence market performance, increasing stakeholder trust and enhancing organizational outcomes. The study concludes that robust audit practices, including quality, frequency, follow-up, and reporting clarity, are essential for improving business governance, financial stability, operational efficiency, and market performance. It recommends that businesses invest in strengthening audit functions by providing necessary resources, increasing audit frequency, improving audit quality, and establishing effective follow-up mechanisms to ensure actionable recommendations. Clear and transparent reporting should also be prioritized to build stakeholder trust and enhance market performance.
