Articles: Department of Business
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Item Effect of Loan Repayment on Financial Performance of Deposit Taking SACCOs in Mount Kenya Region(International Journal of Innovation and Applied Studies, 2015-03) Njeru, Mugambi Duncan; Njeru, Agnes; Member, Florence; Ondabu, Ibrahim TirimbaThis study sought to explore the effect of Loan Repayment on financial performance of deposit taking SACCOs in Mount Kenya Region. The target population was all the thirty licensed deposit taking SACCOs in Mount Kenya Region, the sampling technique employed was simple random sampling and the sample size was 92 respondents. This study adopted a descriptive survey in soliciting information on effects of Loan Repayment on financial performance of deposit taking SACCOs in Mount Kenya region. Primary quantitative data was collected by use of self-administered structured questionnaires. The researcher also used secondary data derived from the audited financial statement of the SACCOs and the regulator (SASRA). The data collected was analyzed, with respect to the study objectives, using both descriptive and inferential statistics. The researcher concluded that there is need for the regulator to introduce credit policy for the sector, this will help in controlling credit risks among the SACCOs in the sector and reduce credit exposure on guarantors. Currently huge percentage of credit risk is on the guarantors but since the sector is on upward trend on growth, there is need to strengthen the sector by adoption of better and efficient credit management system and will ensure the sector is competitive across the Kenyan financial sector.Item Political Environment and Implementation of Public Private Partnership Infrastructure Development in Kenya(European Scientific Journal, 2019-07) Baithili, Moses K.; Mburugu, Kirema Nkanata; Njeru, Duncan MugambiPublic Private Partnership (PPP) is a long term agreement between the public and private sector where risks and rewards are shared in developing a public facility. Private sector play a monumental role in bridging public finance deficit on capital projects. In Kenya, the government has created an enabling environment for private sector participation in the country’s infrastructure development which is meant to spur economic growth. This study sought to establish the effect of political environment on the implementation of Public Private Partnership infrastructure development projects in Kenya. The cross-sectional descriptive survey research methodology was used in the study. The population of the study was sixtythree PPP projects being implemented in Kenya across different sectors. One project was used in pretesting of research instruments. Therefore, the actual population used in the study was sixty-two projects. The study adopted systematic sampling technique where the first n th element was randomly selected. A sample size of 31 was selected from the sampling frame using sampling fraction. Questionnaires were administered to procurement officers charged with implementation of PPPs in the sampled organizations. To ensure validity of the data, the research questionnairre was verified by experts made up of the research supervisors. The research instruments were pretested during pilot study. Qualitative data was analyzed and presented through descriptions while the quantitative data was analyzed using descriptive statistics, measures of central tendency, measures of dispersion and inferential statistics. Multiple regression analysis was used to determine the relationship between dependent and independent variables. The study found that most of the organizations were in the initial stages of implementation of PPPs. The majority of the respondents considered the political environment in Kenya unstable because of the disputed presidential elections which was happening at the time the data 282 European Scientific Journal July 2019 edition Vol.15, No.19 ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431 was collected. The study also found political environment had significant influence on the implementation of PPPs in Kenya. The respondents also identified corruption, poor project selection, lack of experts and cost over-runs as other factors that affected implementation of PPPs. The results of the study will inform policy makers in public entities, County and National Governments to put in place necessary mechanisms to manage politics and fight corruption to increase uptake of Public Private Partnership for infrastructure development in Kenya.Item Analysis of factors influencing access to credit services by women entrepreneurs in Kenya(IISTE, 2014) Karanja, John Gakuu; Mwangi, Anthony Kiragu; Nyakarimi, Samuel N.The purpose of this study was to analyze the factors influencing access to credit services by women entrepreneurs in Kenya; a case of Isiolo town. Entrepreneurship has been regarded as a major contributing factor to the economic growth and poverty alleviation both in urban and rural areas. Organizations for Economic Co-operation and Development (OECD) reports indicate growing phenomena of women entrepreneurship both in developed and developing countries. In some countries, women-owned businesses are increasing at a very rapid pace in terms of both numbers and turnover. The scope of the study was selected from financial lending institutions in Isiolo County and women entrepreneurs targeting those who are members or have accounts in these financial institutions. There are 6 registered FIs operating within the Isiolo town which has a total of 18 management employees and 20 registered women entrepreneurs. The researcher conducted a census on the FIs managers and as well as women entrepreneurs in Isiolo town from the target population. To analyze the data, the researcher applied the chi-square testing the hypothesis of the study. The study recommends that the financial institutions should establish lending procedures which will attract women entrepreneurs and accommodate them in access of credit. It also recommended that the financial institutions should encourage the use of affordable collaterals that will ensure that women entrepreneurs are able to access credit. Lack of affordability collateral was one of the challenges that was highlighted as hindrances to women accessing credit. The financial institutions should ensure that they train women entrepreneurs on investment opportunities in order to increase purposes of credit for women entrepreneurs. This will ensure women entrepreneurs will always have a purpose to do with credit advanced to them by financial institutions.Item Internal control system as means of fraud control in deposit taking financial institutions in Imenti North Sub-County(IISTE, 2015) Nyakarimi, Samuel N.; Karwirwa, MaryThe purpose of the study was to establish the relationship between internal control systems (ICS) and fraud control in deposit taking financial institutions. ICS was analyzed based on its component which include; Control Environment, Risk Assessment, Control Activities, Information and Communication and Monitoring. The Researcher set out to establish how ICS could be used to control fraud in financial institutions. The researcher set study objectives and hypotheses that assisted in establishing the relationship sort. The research was conducted using both quantitative and qualitative approaches using Stratified random sampling, ANOVA and Descriptive Research Designs. Data was collected using Questionnaires from the operations managers and supervisors, from various deposit taking financial institutions in Imenti North Subcounty. A sample of 92 respondents from a population of 120 was used for this study. Data was analyzed using the Statistical Package for Social Scientists (SPSS) where conclusions were drawn from tables and figures derived from the Package. The study found that the financial institutions analyzed recruit through vetting on competences and integrity, the organization structure reflects chain of command, there are proper follow-up of delegated responsibilities and the employees are promoted and compensated fairly. On risk assessment the study revealed that the institutions have proper mechanisms of mitigating risks, financial documents are properly kept, and there are processes of identifying and estimating risks. Though there was agreement that there are no cases of missing documents to authenticate transaction the analysis reflected a low mean than in other parameters. In analyzing control activities it was found that transactions are undertaken by authorized personnel, reconciliations are done regularly, proper accounting principles are applied and there is proper segregation of duties. Further the study showed that there is job rotation and verifications are done to reduce chances of forgery. The study revealed that the institutions have developed means of passing information, the employees are informed of their roles, besides engaging external parties to verify financial statements they also act upon the findings quickly. In monitoring organizations have evaluation mechanisms, they also have plans on activities and ensures that the laid down rules are followed. Research study found that there are continuous checks to ensure controls are working well. The study established a significant relationship between ICS and fraud control. The researcher recommends that the management of these institutions should establish proper mechanisms of promoting qualified and deserving employees, also the institutions should ensure fair remunerations based on qualification, responsibilities and output of employees. The study recommends that the financial institutions establish and manages knowledge or information management system within the institution, so as to enable all parties within the institution to freely access and utilize necessary official information that will enable the employees to embrace and appreciate their roles in enhancing vigilance against fraudsters.Item Use of Control Activities in Fraud Control in Financial Institutions a Case of Financial Institutions in Meru Town, Kenya(2016-08) Nyakarimi, Samuel N.; Shano, Mohamed; Rukangu, SimonThe purpose of the study was to establish the relationship between Control Activities and Fraud Control in Financial Institutions (Banks and Microfinance Institutions). Control Activities analyzed were Internal Checks and Segregation of Duties. The researchers set study objectives and hypotheses that assisted in establishing the relationship that was required. The research study was conducted using both quantitative and qualitative approaches. Stratified random sampling was used and data was collected using Questionnaires from the managers and supervisors, in various financial institutions of Meru town, Kenya. A sample of 84 respondents from a population of 106 was used for this study. Data was analyzed through SPSS using Chi square and Descriptive statistics. In analyzing the selected control activities it was found there were enhanced internal checks that involved peer review and verifications of transactions to reduce chances of forgery, also it was revealed that proper segregation of duties and job rotation have been embraced to increase transparency. In conclusion Research study found that there are continuous checks to ensure controls are working well. The study established a significant relationship between control activities and fraud control.Item Moderating Effect of Government Regulations on Internal Control System and Fraud Prevention. A Case Banking Sector in Kenya(2020) Nyakarimi, Samuel N.; Kariuki, Samuel N.; Kariuki, PeterThe main purpose of the study was to establish the moderating effect of government regulations on the relationship between internal control system and fraud prevention in baking sector. Structured questionnaire was used as tool for data collection. The study was based on all banks registered and operating in Kenya and the questionnaires were meant for branch managers, operations mangers and cash managers in head offices of all banks. One hundred and seventeen questionnaires were distributed and officers from 33 banks out 39 banks returned fully filled questionnaires. The questionnaires were analyzed using Structural equation Model (SEM). The findings indicated that the government regulations have significant moderating effect of control environment and risk assessment. However, there was insignificant moderating effect on control activities, communication and monitoring of activities. The study suggested that further studies and analysis should be undertaken to establish those legislations and regulations that should be enhanced, abolished and also establish need of new laws to enhance the functions of internal control system.Item Risk Assessment and Fraud Prevention in Banking Sector(2020) Nyakarimi, Samuel N.; Kariuki, Samuel N.; Kariuki, PeterThe objective of the study was to assess the effect of risk assessment on fraud prevention in banking industry in Kenya. The study involved all banks in Kenya. Descriptive and correlational research designs were used in this study. Factor analysis was undertaken to reduce the factors and remain with factors that had higher loading which was determined through the use of Eigen values. Correlation analysis was applied to determine the strength and direction of relationship between variables and regression analysis based on structural equation modelling (SEM) was used to test the hypothesis. The descriptive analysis showed that the respondents strongly agreed that the parameters put in place are capable of preventing fraud in banks. The hypothesis testing showed that risk assessment has significant effect on fraud prevention in banking industry in Kenya. From the results of tests, it was concluded that the risk assessment mechanisms put in place to assess the risks have significant effect in fraud prevention and as such they should be enhanced to completely prevent fraud in banking sector. Keywords: Risk assessment; Banking sector; Fraud prevention; Kenya.Item Financial Statements Manipulations Using Beneish Model and Probit Regression Model. A Case of Banking Sector in Kenya(2020-03) Nyakarimi, Samuel N.; Kariuki, Samuel N.; Kariuki, PeterThe main objective of the study was to establish whether the banks in Kenya were involved in financial statement manipulations. The study involved all the banks registered and operating in Kenya and whose financial statements are published for public consumption. Beneish five-variable model was first used to categorize the banks as likely non-manipulators and likely manipulators. The probit regression model was used to determine non-manipulators and manipulators based on the averages derived from non-manipulators using Beneish five-variable model. The results obtained showed that 78.8% of all banks were not involved in financial statement manipulations while 21.2% were involved in financial statement manipulations. The study concluded that some banks that were involved in financial statement manipulations. The study recommended that both internal and control auditors should compute individual indices to determine whether the preparers of financial statements were involved in manipulations. Further it was recommended that the organizations should enhance and strengthen the ICS to seal the loopholes utilized in financial statement manipulations.Item Application Of Internal Control System In Fraud Prevention In Banking Sector(2020-03) Nyakarimi, Samuel N.; Kariuki, Samuel N.; Kariuki, PeterThe main purpose of the study was to establish the effect of internal control system on fraud prevention in banking sector in Kenya. The study involved all the banks where branch managers, operations managers and cash supervisors were sought for the study. The study analysed 117 questionnaires from respondents. Factor analysis was used to reduce the number of variables for analysis purposes. Correlational research study and structural equation model were applied in the study to establish the relationship between variables and in analysis of hypotheses. The study found that control environment and control activities have no statistically significant effect on fraud prevention whereas risk assessment, monitoring of activities and communication of information have statistically significant effect on fraud prevention. Discussions based on the results and related studies were provided. Limitations of the study were highlighted. Recommendations based on the findings were provided. The recommendations were on policy, practise and further research in the same or related areas.Item Earning Management: Analysis of Non-Banking Firms Listed in Nairobi Securities Exchange using Beneish M-Score and Altman Z-Score(2021-02) Nyakarimi, Samuel N.Earning management or manipulation has been that has been used for a long time by the management of various firms to adjust financial reports to meet certain objectives. This practice has been used even for fraudulent and selfish activities. The purposes of the research were to ascertain the levels of earning manipulations and financial distress of non-banking firms listed in Nairobi securities exchange. The latest financial statements were used as the source of information. The Beneish five-variable model was used to determine the presence of earning manipulations. Altman’s Z-Score was used to test the financial distress. The analysis revealed that 58.3% of the firms were not involved in earning manipulations. Further data showed that 41.7% of the analysed firms were in financial distress. The study recommends restitutions by fraud perpetrators through earning manipulations, change of auditors approach to certification of financial reports by including ratios calculations and financial bailout by the government and owners of the businesses in case of financial distress based on economic hardships.Item Employee Productivity in Devolved Governments: The Case of Embu County, Kenya(2021-09) Muturi, Jamleck J.; Okech, Timothy C.The research aimed at examining factors affecting employee productivity in devolved governments in Kenya in terms of three thematic areas namely motivation, employee capacity and infrastructure in Embu County government. Adopting descriptive research design, the study targeted employees in the county, from whom a sample of three hundred and forty-five respondents was selected using stratified sampling technique. Data was collected using a structured questionnaire that contained both open and closed ended. Data collected was analyzed to obtain both descriptive and inferential statistics. The study revealed that the government has initiated several motivating strategies including merit promotion, an inclusive leadership and training opportunities. Merit recruitment, good leadership and employees’ level of training positively influenced employee productivity. Though the county government has provided necessary working infrastructure, this was considered inadequate thereby impacting negatively on employee productivity. In light of the findings, the study recommends that the county government should provide adequate infrastructure including utilities and transport facilities, develop systems that maintain employees good work stations and provide adequate annual budgetary allocations for efficient service delivery. Additionally, the county government need to reconsider re-evaluating its training and motivation systems as well as improve on the employee working environment.Item Technical efficiency of the small-scale tea processors in Kenya: a stochastic metafrontier approach(Emerald, 2020-04) Karambu, Gatimbu K.; Maurice, Juma O.Purpose – Importance of small-scale tea producers in Kenya is not in doubt. They account for 60% of all tea produced in the country, serve about 560,000 tea farmers and employ about 10,000 people directly. However, the subsector faces a myriad of challenges ranging from declining yields and rising costs of production to fluctuating world prices. Thus, it is imperative that the producers entrench efficiency as a critical success factor. This makes it important for the producers to understand their relative performances to inform decisions on improving input use. Congruent with this motivation, this study sought to analyze the technical efficiency (TE) of the country’s small-scale tea processors within and across the regions under the management of Kenya Tea Development Authority. Design/methodology/approach – To allow comparison across regions, this study adopted a stochastic metafrontier approach and to be able to decompose inefficiency into persistent and time-varying components, the study adopted regression analysis. Findings – Results showed that the small-scale tea processors operated at a mean TE level of 76% with a technology gap ratio (TGR) of 97%. This implies that the prevailing level of output could be maintained even if inputs were reduced by 24%. Persistent inefficiency could be reduced possibly through rationalization of structural and managerial components of the firms. Research limitations/implications – While it is important to adopt yield-enhancing technologies and innovation, small-scale tea processors have the latitude to improve their earnings through enhanced TE. They can save up to 24% of their input and be able to pay farmers better even with the fluctuating global tea prices. Enhancing TE should be given priority because it is within the control of the individual firms. Originality/value – This is a pioneering study in panel data analysis of TE of small-scale tea processors within and across regions in KenyaItem The Influence of Value Innovation Strategy on the Financial Performance of Manufacturing Firms in Kenya(Academic Research Publishing Group, 2020-12) Gachora, Susan; Kinyua, Jesse; Mburugu, Kirema N.Value innovation is the cornerstone of blue ocean strategy. Value innovation strategy aims at making competition irrelevant. The concept of value innovation strategy is founded on the belief that a business can make its competitors irrelevant in its decision making while at the same time emerging an industry leader. The purpose of this study is to establish the influence of Value Innovation Strategy on the financial performance of manufacturing firms in Kenya. The target population was 488 manufacturing firms drawn from the 12 categories of the sector in Kenya. Descriptive and inferential statistics were used in this study. The descriptive results indicate that the manufacturing firms in Kenya have implemented value innovation strategies which positively contribute to the financial performance of the firms. The inferential results also affirm that value innovation strategy significantly affect the performance of manufacturing firms in Kenya attributing up to 14.9% of its variation in performance. The study concludes that value innovation strategies boost financial performance of a firm. Managers of manufacturing firms should therefore implement value innovation strategies in order to improve financial performance.Item PERFORMANCE MANAGEMENT AND PUBLIC SERVICE DELIVERY IN KENYA(2015) Korir, Salome C.R.; Rotich, Jacob; Bengat, Joseph KPerformance management aims at attaining operational effectiveness which in a broader sense refers to a number of practices that allow an organization to better utilize its resources. The need for productivity, quality and speed has spawned a remarkable number of management tools and techniques; total quality management, benchmarking, re-engineering and change management. All these, if pursued from the strategy point of view may lead to emphasis being put on the wrong place. Lack of clarity can be attributed to the fact that most public agencies have to deal with multiple principals who have multiple interests (Triveldi 2000). This leads to fuzziness in what is expected from implementing agencies. Performance management is therefore gaining momentum in many public sector organizations. Reforming the public sector in developing countries has come a long way with the progressive shift towards operational effectiveness, which entails doing what one is doing better. With defined outcomes and appropriate benchmarks to measure the outcomes, the rampant lack of focus is brought into the open. This paper addresses the issues related to performance management in public sector organizations in Kenya and its contribution to the service delivery processItem Research Paradigms(2015) Tubey, Ruth J.; Rotich, Jacob K.; Bengat, Joseph KThis paper reflects on the ontological, epistemological and methodological underpinnings of the two major research approaches i.e the quantitative and the qualitative approaches. Their differences, occasioned by these philosophical foundations are discussed and practical implications examined. It is our view that this paper will have positive impact on the work of researchers and students undertaking courses in research studiesItem Information Technology Innovation and Organizational Policy(2015) Joseph, Bengat K.; R. J 2, Tubey; Rotich3, Jacob KIssues relating to workplace privacy and how organizations address privacy have sparked a lot of public debate in recent years. Research reveals that potential employers have exploited employees seeking job opportunities by asking information to do with: disclosure of confidential information about the past employer’s work, financial background, and family intimate issues not relevant to the job being sought among others. This paper establishes the implications of information technology innovation on organization policies with emphasis on employees’ privacy. The study was done in two organizations and it adapted a case study approach. Data was collected from 74 respondents using questionnaires. Respondents were sampled using purposive technique. Frequency distribution tables were used in data presentation followed by discussions. The findings of this study are critical in informing the policy makers in organizations on procedures and strategies of inclusive policy formulation and implementation as well as provide HR managers with insight on managing privacy issues in dynamic organizational setupsItem Implementing strategic planning in private health institutions in Kenya(2015-02) Bengat, Joseph K.; Tubey, R. J.; Kurgat, AliceMost private health institutions in Kenya operate according to policy framework of the ministry of Health’s strategic plan. Individual Trust and Private Hospitals are expected to develop plans as to how they will implement the directions from either the ministry or their own strategic plan or both. Like public health sector, private health sector has experienced moments of congestions rendering its employees inefficient in delivering services. This research sought to find out the challenges faced by private health institutions in implementing strategic plans. Data was collected from 138 employees. Data was obtained using structured questionnaires and interview schedules. The research utilized the Case study design. The findings showed that private health sector in Kenya face a lot of challenges in implementing strategic planning. Among these are: financial constraints, high staff turnover, overdependence syndrome among the clients, lack of © Bengat, Tubey & Kurgat Licensed under Creative Common Page 2 modern technology, resistance at the implementation stage and poor infrastructure which have impacted negatively on employees’ performance. The findings also revealed that implementing such plans is a difficult task in the presence of few and demotivated workforce and little financial and technological resources. These are the issues that should be addressed in strategic planning implementation. The findings indicated that if hospitals put in place a proper strategic plan, it will help ease such congestions and improve efficiency, which can yield tremendous benefit for the entire sector.Item Moderated Mediation Effect of Feedback Seeking Behavior and Goal Commitment on the relationship between Proactive Personalities and Sales Performance of Insurance Sales Agents in Mombasa, Kenya(2019-05) Njagi, Zippy Mukam; Lagat, Charles; Korir, MichaelThe purpose of this study was to examine the Moderated Mediation effect of Feedback seeking behavior and Goal Commitment on the indirect relationship between Proactive personalities and Sales performance. The study adapted explanatory research design targeting 448 insurance Sales Agents in Mombasa County, Kenya. Using self-administered questionnaires, reliability test of the research instrument was done by the use of Cronbach’s alpha. The Pearson correlation and conditional process analysis, model 4 and model 58 was used to analyze the data and to test each of the hypotheses. The findings of the study confirm a positive effect of Proactive personalities on Sales performance and Goal Commitment. Goal Commitment was also found to positively affect Sales performance. Furthermore, the result confirms the Mediating effect of Goal Commitment on the relationship between Proactive personalities and Sales performance. The study also confirms that Feedback seeking behavior Moderates the relationship between Proactive personalities and Goal Commitment but does not moderate the relationship between Proactive personalities and Sales performance. Lastly the finding confirms that Feedback seeking behavior Moderates the indirect relationship between Proactive personalities and Sales performance via Goal Commitment. Managers and policymakers should formulate policies and strategies which nurture proactive behaviour among sales people by seeking feedback of their performance as they pursue the individual desired and organization’s set goalsItem Self Efficacy, Goal Commitment and Sales Performance Among Insurance Sales Agents in Mombasa, Kenya(2019-05) Njagi, Zippy Mukami; Lagat, Charles; Korir, MichaelThe purpose of this study was to examine the Mediation effect of goal commitment on the relationship between self-efficacy and sales performance. The study adapted explanatory research design targeting 448 insurance Sales Agents in Mombasa County, Kenya. Using self-administered questionnaires, reliability test of the research instrument was done by the use of Cronbach. Pearson Correlation and conditional process analysis, model 4 was used to analyze the data and to test the hypotheses. The study found that self-efficacy and goal commitment had a positive and significant direct effect on sales performance. Further, the study confirmed a Mediating effect of goal commitment on the indirect relationship between self-efficacy and sales performance. The findings of the study confirm a positive effect of selfefficacy on sales performance and goal commitment. Goal commitment was also found to positively affect Sales Performance. Furthermore, the result confirms the Mediating effect of Goal commitment on the relationship between Self-Efficacy and Sales Performance. Managers and policy makers should therefore put strategies in place that help their sales persons to know the right thing to do in every selling situation. This can be done through indoor training programs as it helps them feel confident of their ability to perform their sales job well and effectively.Item Determinants of Service Delivery in the Health Sector among Selected Counties in Kenya(2017-11) Bengat, Joseph K.; Nassiuma, Bernard. K.; Kwonyike, JoshuaThis study investigated determinants of service delivery in the health sector in Kenya.The study examined the effect of Public-Private Partnership (PPPs), Transfer Pricing, New public management in Service Delivery. The research adapted pragmatism paradigm, Research approach utilized was mixed method approach, design. Research utilized was s descriptive survey design, target population consisted of health workers 1,740, a sample size of 314 respondents was adopted from a thesis. Analysis was employed by Structure Equation Modeling.Findings: Two null hypotheses were rejected hence Public-Private Partnership positively affects Service Delivery. Transfer Pricing model was reliable and had good fit, (NFI = 0.912); New public management posted low CFI and GFI. Ant-Image for (PPP, TP& NPM posted: ai = 0.970, = 0.980 &=0.620) respectively. Results for transfer pricing indicate that ratio index, 2.15 is less than 5, in other words the model is a good fit. The relative chi-square should be 5 or less to reflect good fit or acceptable fit. New public management indicate ratio index , 6.30 more than 5 indicating a model of not good fit its, CFI .890, NFI, 0.7 lower than threshold . Public-Private Partnership had ratio, 1.907 which is less than 5 in other words the model is a good fit. Its also indicates NFI= 0.900, and GFI = 0.911.The study concludes that new public management loaded poorly hence the variable had lower weight as a predictor compared to the two predictors. Transfer pricing strongly influences Service Delivery, but its model is not fit. All in all the three constructs: PPP and TP are good contributors to Service Delivery, New public management loaded poorly with a lower weight and weak association compared to other predictors. This research recommends that New Public Management should be further researched.