KABAHWEZA GRACE2025-10-102025-10-102025-09-24https://hdl.handle.net/20.500.11951/1903Internal control systems play an essential role in enhancing operational effectiveness, protecting against fraud, and fostering accountability in organizations. While most studies in Uganda and Africa have focused on financial institutions such as banks, insurance companies, and government agencies, limited attention has been given to the automotive industry, despite the prevalence of inefficiencies and fraudulent practices in the sector. This study therefore examined the effect of internal control systems on operational performance in the automotive industry, using Motor Care Uganda Limited (Nissan) as a case study. Specifically, the study analyzed the effect of the control environment, control activities, and risk assessment on operational performance. A descriptive research design was adopted, employing both correlation and regression analysis to determine the relationships between the variables. Data was collected from 52 employees across different departments, including purposively selected key informants such as the deputy managing director, departmental heads, an internal auditor, and an accountant. The results revealed strong correlations among the components of internal control systems and operational performance, with risk assessment, control environment, and control activities all significantly related to performance indicators such as service quality, inventory management, cost reduction, financial accountability, and customer satisfaction. Regression analysis further showed that control activities and the control environment significantly and positively influenced operational performance, while risk assessment, although positively correlated, had a weaker predictive effect. The study concludes that internal control systems are a significant driver of operational performance in the automotive industry. It highlights the importance of maintaining robust control activities and a strong control environment, alongside proactive risk assessment practices, to enhance efficiency and accountability in operations.