Theses and Dissertations
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Item Effects of Corporate Social Responsibility on Financial Performance of Insurance Firms in Kenya(KCA University, 2018) Mugoiri, Ronnie N.The study sought to investigate the effects of CSR on the financial performance of insurance firms in Kenya. The study considered the three forms of CSR – Environmental CSR (ECSR), Philanthropic CSR and Community Development CSR as the independent variables and financial performance as the dependent variable. The study employed a descriptive research design to test for the effects of CSR on financial performance of insurance firms in Kenya measured by ROA. Investment in CSR was measured using monetary expenditure on CSR initiatives. Secondary data was obtained from audited financial statements, websites, publications and annual reports for the years 2008 to 2017. The objectives of the study were; to examine the effect of environmental CSR on the financial performance of insurance firms in Kenya, to establish the effects of philanthropic CSR on the financial performance of insurance firms in Kenya and to determine the effects of community development CSR on the financial performance of insurance firms in Kenya. Exploratory analysis, descriptive analysis and regression analysis using STATA version 12 was used to test the research hypotheses at 5% level of significance. Results were presented using tables and graphs. The Pooled OLS regression results revealed that environmental CSR had a statistically insignificant negative effect on the financial performance of insurance firms as measured by return on assets. The results indicated that philanthropic CSR had a statistically insignificant negative effect on the financial performance of insurance firms as measured by return on assets. The results showed that community development CSR had a statistically insignificant positive effect on the financial performance of insurance firms as measured by return on assets. The study findings revealed that CSR had mixed statistically insignificant effects on financial performance of insurance firms in Kenya. Therefore, the study concluded that CSR has no effects on the financial performance of insurance firms in Kenya. The researcher recommended that scholars and practitioners in Kenya and elsewhere in the developing world should rethink the concept of CSR to make it relevant, practicable and applicable to the prevailing contexts. insurance firms in Kenya should develop clear comprehensive company policies and implementation frameworks to guide their CSR operations and reporting on the same. The researcher also recommended that there is need for the Government develop comprehensive legal, regulatory and policy framework to guide CSR activities in the country so that the CSR movement can be focused on the country’s development agenda in their CSR initiatives.Item Organizational factors influencing financial performance of private companies in Kenya: a case of KTDA factories in aberdare ranges regions.(Kca University, 2016) Wachinga, Muchire G.Financial performance is an important measure of the productivity and effectiveness of an organization. This is because it is an indicator of the ability of an organization in using its resources to generate wealth, profits and returns for stake holders. There are several determinants of financial performance including the resource use, employee productivity, leadership in the organizations. The purpose of this study was to identify and examine how organizational factors which include top management and support team, organizational structure and the corporate governance influence the financial performance of KTDA factories. The aim of the study was to get data on these organizational factors and analyze them with a view of finding out their relationship with financial performance of the of KTDA factories that were sampled. The study used the quantitative research method. A census was done on 9 factory managers and their assistants, finance officers and human resources managers. The total population comprised of 18 factory managers and their assistants, 9 finance officers and 9 human resources managers all totaling 36 target respondents. The study solely relied on primary data for research information. Questionnaires were used to collect primary data from the participants. Regression analysis was done to find the correlation between each organizational factor and tea factories financial performance. The data was analyzed using SPSS software. The study found out that: Most of the respondents rated the organizational structures of the tea factories as highly layered and having occasional opportunities of impairing and negatively affecting the decision making processes. Most of the respondents had the feeling that the members of the top management cadres merited their positions but situations of challenges occasioned by poor employee performance attributed to unqualified personnel in top management positions were confirmed. All the respondents confirmed the tea factories had code of ethics that guided the interactions between the shareholders and the institutions. The ability of the codes of ethics to assure harmonious interactions by the membership was confirmed. All the respondents confirmed there had been instances of strained internal relations which they attributed to the inadequacies of the codes of ethics in use. The study recommended that: organizations should strive to ensure that they have lean organizational structures as a measure of reducing operational costs and enhancing efficiency. In the situation of the tea factories, conferring them with independence from the KTDA parent company may greatly enhance their positions in terms of freeing them from obligations to the parent company. The top management in private companies should equally be implored on to carry out its activities diligently as a measure of ensuring that the ideals of the organizations are met. The organizations should ensure that the recruitment of the top managers is driven by merit and ascension in the organizational hierarchy is meritorious. Private companies should work towards enhancing their corporate governance thresholds to earn industry respect and elicit attention from peers. The tea factories should seek to ensure that the prescribed tenets guiding corporate governance expectations are adhered to as a measure of assuring them confidence from peers and other partners collaborating with them in different lines of business.Item Effect Of Internal Audit Reporting Quality On Financial Performance Of Savings And Credit Cooperative Societies A Case Study In Murang’a County In Kenya(KCA University, 2014) Mbuti, Elijah M.The cooperative movement in Kenya now boasts of an annual turnover of Ksh 43.6 billion which is equivalent to 4.5% of the country’s Gross Domestic Product. SACCOs globally continue to perform poorly financially due to poor management and fraud. An inspection report compiled by the SACCO Societies Regulatory Authority showed that many SACCOs in Kenya have been involved in mismanagement, fraud and corrupt practices. SACCO regulations (2008) stipulated that every SACCO shall establish an internal audit function which shall be responsible for reviewing and reporting on the adequacy of the internal audit system and the financial matters of the SACCO. The general objective of this study was to determine the effect of internal audit reporting on financial performance of SACCOs. The specific objectives were to: determine the effect of objectivity of the internal audit reports on financial performance of SACCOs in Kenya; establish the effect of internal audit reporting channels on financial performance of SACCOs in Kenya; examine how internal audit report completeness affects financial performance of SACCOs in Kenya, and; determine the effect of internal audit report timeliness on the financial performance of SACCOs in Kenya. The researcher employed descriptive survey design. The target population of this study was all the SACCOs in Murang’a County which are estimated to be 400. Stratified sampling was utilized to select a sample of 120 SACCOs. A questionnaire was used to collect data. Descriptive statistics such as mean scores, percentages and frequency distributions were applied to data in nominal, ordinal and interval scales. Inferential statistics including regression and correlation analysis were applied to establish whether there was any significant relationship between audit reporting and financial performance of SACCOs. The study findings reveal that objectivity of financial reporting in SACCOs, internal audit report completeness and timeliness of internal audit reporting all had significant effect on financial performance of SACCOs. However, internal audit reporting channels did not have a significant influence on financial performance of SACCOs. The following recommendations are made. First, SACCOs should ensure that internal audit reports in the SACCO are not based on hearsay, subjective judgment or witch-hunting. Second, the internal audit departments should be independent and should report to the highest office in the SACCO to ensure that this department carries its function effectively and competently without any fear or favor. Third, the SACCOs should ensure that internal audit department provides comprehensive reports with an assessment of the entire effectiveness of risk, governance and controls that the organization has put in place. Lastly, SACCOs should ensure that internal audit reports on high risk areas are done regularly so that to make sure risk from these areas is managed effectively.Item The Effect Of Corporate Social Responsibility Disclosure On Financial Performance Of Manufacturing Firms Quoted On Nairobi Securities Exchange(KCA University, 2018) Mugambi, Charles M.The purpose of this study was to determine the effects of corporate social responsibility disclosure on the organizations financial performance. Specifically, the study examined the effect of environmental disclosure, community disclosure, employee disclosure and financial performance of quoted manufacturing companies in Kenya. The study was anchored on stakeholders theory, legitimacy theory and stewardship theory. The study employed census research design. The target population was all the manufacturing firms that are listed in the NSE from 2007 to 2017. The researcher identified manufacturing firms because they impact heavily on environment through waste and pollution they discharge and in addition they are capital and labour intensive organizations. This study used secondary data and content analysis of data from the published financial records and analysis of other reports of the companies. Stata version 12 was used to analyze the data using both descriptive and inferential methods. The findings were presented in form of tables and figures. It was expected that the study findings help business owners and managers to make more informed decisions on whether or not to adopt corporate social responsibility disclosure. The study also expected to help investors to understand the relationship between corporate social responsibility and financial performance which will help them design and allocate their portfolio in a manner that maximizes returns by investing in firms and organizations that make decisions based on ethical concerns. Further, the study also expected to enrich the discussion on corporate social responsibility and contribute to the existing literature and theories. The study found positive and non-significant effect of environmental disclosure, community disclosure and financial performance of quoted manufacturing companies in Kenya. Moreover, employee disclosure had inverse and non-significant effect on financial performance of quoted manufacturing companies in Kenya.Item Effect Of Financial Risk Exposure On Financial Performance Of Manufacturing Firms Listed At The Nairobi Securities Exchange(KCA University, 2019) Nyamongo, Julius N.The economic condition has forced many firms, including those in the manufacturing sector to be put under receivership as a result of financial losses and debts, which are associated with various risk exposures in the firm. The study sought to investigate the effect of financial risk exposure on the financial performance of manufacturing firms listed at the Nairobi Securities Exchange (NSE). The specific objectives were to; determine the influence of credit risk exposure, to establish the influence of liquidity risk exposure and to determine the influence of market risk exposure on the financial performance of manufacturing firms listed at the NSE. A census of Nine (9) listed companies as the target population was taken but only seven (7) companies participated in the study since they have all data for the period of study. The sample size of the study therefore was all the listed companies. Secondary data from the financial statements and other media printed information for a period of 2009 – 2018 was used and data was collected using data collection sheets. Multiple regression model together with the use of STATA software was applied for data analysis. To choose the true model, various diagnostic tests such as normality test, multicollinearity test, heteroscedasticity test and Hausman test was performed to choose the appropriate model of the study. The study findings established that data for the study met all the requirements of diagnostic tests. In Hausman test, the study chose random effect model (REM) as the most appropriate model for use in the study. A trend plot analysis was performed on each variable of the study and performance explained. From the correlation and regression analysis results of the study, the findings revealed that credit risk exposure (RT) had a significant positive relationship with financial performance. Second, the study established that liquidity risk exposure have insignificant positive relationship with financial performance (ROA) of the listed manufacturing companies at the NSE. Lastly, the results also revealed that there was insignificant positive relationship between market risk exposure and financial performance (ROA). The study recommends that the management, policy makers and investors need to develop effective financial risk policies that should help in curbing risks that companies are exposed to in the market so as to improve financial performance. The study further recommends that future study be undertaken on the financial risk exposures using other measures of various financial risks adopted in the study variables. The study recommended that a future study may consider using other financial performance measures like return on equity (ROE) or return on investment (ROI) so as to determine whether the level of consistency in research findings hold. There is also need for the studies to consider other companies listed at the NSE as potential area for research.Item Effect Of Income Source Diversification on Financial Performance of Deposit Taking Savings and Credit Cooperative Societies In Nairobi County(KCA University, 2016) Jerono, JaneSACCO industry has experienced growth that has increasingly brought competition and this has made a number of SACCOs to diversify their sources of income thus bringing to question the impact of such diversification on the performance of SACCOs. This study was carried out with an aim to analyse the effect of income source diversification on the financial performance of SACCOs. Specifically, the study focused on the effect of service charges, sale/lease of assets and other sources of non-interest income on financial performance of deposit taking SACCOs in Kenya. The study used descriptive study design and targeted a population of 36 licensed deposit taking SACCOS in Nairobi County. The sample of the study was 100 respondents selected from 5 SACCOs. Purposive sampling was used to collect data from the unit of the study who are the managers in the SACCOs. The study used questionnaire method to collect data from the respondents with the questionnaire piloted before data collection to test for reliability and validity. Data collected was analysed through SPSS through the use of Pearson correlation and ordinal regression. The data analysed was pres00ented through tables, frequencies charts, graphs and frequencies. The study findings indicated that there is no significant relationship between service fees and financial performance of SACCOs. The study findings further revealed that sales/lease of assets and other non-interest income has significant relationship with financial performance of SACCOs. The study results indicated that 44.1% of the changes in financial performance of SACCOs can be attributed to service fees, sale/lease of assets and other sources of noninterest income. The study concludes that sales and lease of assets and other non-interest income affect financial performance of SACCOs. The study recommends that SACCOS should increasingly diversify their income source to sale/lease of assets and other non-interest income.