Syrtseva Svitlana, PhD in Economics, Associate Professor, Associate Professor of the Accounting and Taxation Department, Mykolayiv National Agrarian University, Mykolayiv, Ukraine

ORCID ID: 0000-0003-4824-3741
e-mail: sirceva@mnau.edu.ua

The Impact of the Internal Control System on the Quality of Accounting of Public Sector Entities in Ukraine

Abstract. Introduction. The effective functioning of the internal control system (ICS) in public sector institutions is a critical condition for ensuring the reliability of accounting data, compliance with financial discipline, and prevention of inefficient use of budget funds. Given the current challenges of administrative reform and the digitalization of accounting processes, the issue of integrating internal control into the accounting system has become particularly relevant. Despite the presence of regulatory and methodological support, the practical implementation of internal control mechanisms often remains fragmented and limited in their influence on accounting procedures.

Purpose. The purpose of the article is to substantiate the role and importance of the internal control system in ensuring the quality of accounting in public sector entities and to develop scientifically grounded approaches to improving control mechanisms considering the specifics of budget institutions.

Results. The article systematizes theoretical and methodological foundations of internal control in the public sector, including domestic legal regulations and international practices (COSO, INTOSAI). Based on a survey conducted among 20 public sector institutions in the Mykolaiv region, key issues in the interaction between control procedures and stages of the accounting cycle were identified: lack of analytical depth during document checks, weak interdepartmental coordination, and insufficient use of internal reports in decision-making. A classification of scientific approaches to evaluating the effectiveness of ICS was also presented, with emphasis on their applicability to accounting functions.

Conclusions. The study demonstrates that improving the quality of accounting in public sector institutions requires systemic integration of internal control procedures into all key stages of the accounting cycle. Effective ICS implementation contributes not only to the detection of errors and violations but also to the formation of reliable, complete, and timely accounting information for managerial and financial reporting purposes.

Key words: internal control system, accounting, public sector, control procedures, accounting cycle

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