INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS) ISSN No. 2454-6186 | DOI: 10.47772/IJRISS |Volume VII Issue IX September 2023 Page 1648 www.rsisinternational.org Internal Control System and Financial Management in Federal Government Hospitals Oluyemi Ayodeji Olayisade 1 , Olusola Esther Igbekoyi (Ph.D) 2 , Kolawole Mohammed Akande 3 * , Bukola Elizabeth Abiola 4 1,3,4 Department of Accounting, College of Social and Management Science, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria 2 Department of Accounting, Faculty of Administration and Management Sciences, Adekunle Ajasin University, Akungba-Akoko, Ondo State, Nigeria *Corresponding Author DOI: https://dx.doi.org/10.47772/IJRISS.2023.71033 Received: 25 August 2023; Revised: 08 September 2023; Accepted: 13 September 2023; Published: 18 October 2023 ABSTRACT Literatures on internal control system in the public sector are quite numerous, with just a few studies assessing how financial management in Federal hospitals in Southwest, Nigeria could be enhanced by the components of internal control system. This study covered this gap by examining internal control system and financial management if Federal government hospitals in Southwest, Nigeria. Descriptive research was adopted and the population covered six Federal government hospital in Southwest. 91 respondents were selected across the sampled Federal government hospitals in Southwest, Nigeria. A close-ended questionnaire was used after which, analysis was carried out via Pearson product moment correlation and multiple regression. It was discovered that there is a positive and significant relationship between the components of internal control system (control activities, control environment, risk assessment, information and communication and monitoring) and financial management (financial planning and control) in Federal government hospitals in Southwest, Nigeria. It was concluded that financial management in Federal government hospitals could be enhanced through the internal control system. Thus, it was recommended that the federal government hospital management should ensure that the internal control system is periodically monitored and evaluated to enhance their financial management productivity. Keywords: Internal Control System, Control activities, Control environment, Risk assessment, Information and Communication, Monitoring, Financial Management. INTRODUCTION The health sector of an economy is a division in the economic system charge with the responsibility of providing medical services, manufacturing medical equipment/tools and drugs, providing medical insurance otherwise facilitate the provision of healthcare to patients and many more (Faiza Longbao, Abid-Hussain, Muhammad & Syed, 2018). This sector consists of hospitals, sanatoriums, nursing and care homes, medical and dental practices, ambulance transportation, complementary medicine and other health activities, such as medical laboratories and scientific and research services, across a range of organizations within the public, private and voluntary sectors. As a result of the significant contribution of this study to the Nigerian economy among other economies in the universe, the government at all levels ensures the sustainability of this sector among other sectors (Abdulrahman, 2018). Most especially, the federal government established various hospitals with up-to-date facilities to render medical services for the populace at free as at little price as the case may be. Ajayi and Edewusi (2020) posited that recently the federal government pumps public funds into the health sector on daily basis to fight against the germane virus in society and ensure the sustainability of the sector at the long run. However, many Nigerians have a deep-rooted mentality that public funds are popular cakes for individuals to consume for personal satisfaction. This is due to the corrupt practices that has eaten deep into the fabric of public office holder in the public health sector. Though, it is basically necessary to effectively mobilize and