CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF STUDY
1.2 BACKGROUND OF MICROFINANCE INSTITUTIONS IN CAMEROON

All organizations, whether profit or not, tend to operate within conditions of resource management. As a result, management continues to look for better ways and methods to help administer control and supervise, direct towards attainment of investors goals of the organization. In other to do this, they have deduced various strategies that need to be taken and established new procedures which ensure the maximum utilization of resources in achieving the goals of the organization. Looking at the procedures an organization uses to achieve its goals will be easily seen with the help of an organization structure, within which a detailed and conducive operation can take place. This organization structure is often shown in the form of a chart, which outlines the level of authority, as well as the communication channel, and the rules as well as the responsibilities of workers throughout the organization. Though there might be the problem of scarce resources at times, there are also some aspects which are risky to the business and are bound to occur in an organization such as fraud, errors, misappropriations, and inefficiency. These will enable the creation of steps which will aid minimize, if possible, eliminate completely these negative aspects by establishing rules and regulations. Hence leading to the creation of risk strategies, principles, checks,policies and procedure.

For any organization, it goes with risk of not completely achieving its goals and objective aspect of not reaching its goal known as internal control. With the rapid expansion of organizations, there has been the need for control in order to regulate their activities. As private companies grow and together brought in outside shareholders, the need to regulate and control the behavior of those running the companies grew
and the first set of legislation governing companies was in the early 20th century with the forum companies acts of 1862 and enforce till date. As years passed, there have been some changes such as the information technology, the expansion of communication network across the globe. Likewise, laws and regulation evolve which governs the conduct of organizations in relation to their working aspects, employees and with the public as a whole. In Cameroon the micro-finance institutions are regulated administrated, supervised and controlled by MINFI, COBAC, BEAC and a good example can be seen from the OHADA uniform act. Apart from these, organizations still run on with international standards and Guides.

Despite the regulatory initiatives, there are a number of international standard, which tend to affect and influence the processes with an organization. The institutions behind these standards include the international Organization for Standardization (ISO), the international Electro Technical Commission (IEC), and the British Standards (BS). The three main standard today are ISO90001 (and derivatives). Iso 14001 controls to achieve quality I products and processes. Iso 14001 addresses the controls to protect the environment. ISO/IEC 17799 addresses the processes for information security within an organization and BS 7799-2 provides the mechanics for management systems.
1.3 PROBLEM STATEMENT
The word internal control has lots of definitions and mean different things to people. Hence, confusion arises mainly with business people, and sometimes with others such as legislator. The aspect misses communication and different expectations cause problems within an enterprise. Problems will tend to compound if the term is not clearly defined. Thus, it is with great importance for company executives and
employees to clearly understand what is referred to as Internal Control.