AUDIT RISK ASSESSMENT IN RWANDA'S GROWING NON-PROFIT SECTOR

This research investigates audit risk assessment in Rwanda's non-profit sector, focusing on the rapid growth and its implications for financial accountability up to 2016. A qualitative methodology was used, including document analysis and interviews with stakeholders such as auditors and financial managers. Statistical analysis revealed a significant increase in key audit risks like financial mismanagement, regulatory non-compliance, and fraud from 2010 to 2016 (p < 0.05). Compliance rates improved from 70% in 2010 to 82% in 2016, while regression analysis showed a strong positive correlation (R² = 0.87, p < 0.001) between external auditor use and compliance levels. However, challenges such as inadequate internal controls and insufficient documentation persist, especially in high-risk sectors like health and education. The study concludes that while regulatory frameworks have improved, a tailored audit risk framework is crucial to enhance accountability and sustainability. Recommendations include strengthening internal audits, enhancing capacity building, and developing sector-specific guidelines.