Theses and Dissertations
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Item Effects Of Working Capital Management Practices On Financial Performance Of Food And Beverage Manufacturing Companies In Kenya(KCA University, 2019) Kituku, Hosea K.In the recent past, the Food and Beverages manufacturing industry has been facing challenges to thrive and this has resulted in some of the companies in the sector to close and others relocate to other countries. This follows the unfavorable working environment in the country including individual firms challenge. The challenges force the organizations to maintain either inadequate or excess working capital levels. These working capital levels maintained are not desirables in the current competitive market. Working capital management practices involves managing the firm's inventory, receivables and payables in order to achieve a balance between risk and returns and thereby contribute positively to the creation of a firm’s value. Excessive investment in inventory and receivables reduces the profits, whereas too little investment increases the risk of not being able to meet commitments as and when they become due. This study aimed at examining the effects of working capital management practices on financial performance of food and beverage manufacturing companies in Kenya. The dependent variable was financial performance and the independent variables were inventory management practices, cash management practices, accounts receivable practices and accounts payable practices. A descriptive research design was used in the study. The target population was 181 food and beverage manufacturers in Kenya registered under KAM. The sample for the study was all the 65 food and beverage manufacturing companies in Nairobi County which are spread across various sub-sectors of food and beverage. The study used primary data. Questionnaires were administered as the preferred primary data collection instrument. Data analysis was done using Stata software. Diagnostic tests on normality, randomness of residuals, multicollinearity and homoscedasticity of the residuals was carried out to ensure goodness of fit. Mean, Standard deviation, and Regression analysis were calculated. The analyzed information was presented in tables, charts and figures for interpretation to establish the relationship between financial performance and working capital management practices for food and beverage manufacturing firms. The study found that in relation to inventory management practices that the firm periodically forecasts inventory requirements. The study further established that with regard to cash management, the company updates prepayment schedule. In relation to accounts receivable, credit limit is set for each customer. Additionally, regarding accounts payable practices the firm has set up payment policy. At 5% level of significance and 95% level of confidence, inventory management practices and accounts receivable practices, were significant on financial performance of food and beverages companies in Kenya. Cash management practices and accounts payable practices are not statistically significant in explaining financial performance. The study concluded that the company periodically forecast inventory requirements, credit limit is set for each customer and that the firm has set up payment policy. The study recommends the use of various inventory management practices and accounts receivable practices in management working capital amongst the food and beverage companies in Kenya.Item Effect Of Financial Management Decisions On Performance Of Manufacturing Firms Listed On Nairobi Securities Exchange(Kca University, 2016) Muinde, Isaac M.The effect of finance management on manufacturing firm performance in Kenya needs to be studied. Using panel research design, the study seeks to investigate the effect of finance management decision on listed manufacturing firm performance in 2005 to 2014. Specifically the study seeks to establish the effect of leverage and manufacturing firm performance among listed companies in NSE. To determine the effect of investment decision on manufacturing firm performance, to find out the effects of dividend policy on manufacturing firms' performance and to establish the effect of working capital on manufacturing firm performance. The target population of this study was all the nine manufacturing listed companies in Kenya. The study was based on secondary data which was collected from the published annual reports for listed companies manufacturing firms in (2005-2013). Both Microsoft excel and E views 8 were used to analyse the data. A graphical method was used to explore the data. Panel regression analysis was used to examine the relationship between independent and dependent variables. Results of the study revealed that there was negative relationship between investment and EBIT while leverage, dividend, working capital and total assets had a positive relationship with EBIT. There was a positive relationship between annual sales and investment, leverage, dividend, working capital and total assets. There was a positive relationship between leverage, dividend, working capital, total assets and gross profit while investment had an inverse relationship. The firms should examine their credit rating, predict their chances of bankruptcy. Secondly, they should evaluate all the investment decisions to ensure that they attain optimal benefits from all capital expenditure. Manufacturing company annual dividend policy ought to be examined to ensure that it meets the unique needs of all investors. The firms should evaluate the working capital decision so that they can adapt the optimal working capital cycle.Item Effect Of Selected Firm Characteristics On Financial Performance Of Commercial Banks In Kenya(KCA University, 2021) Juma, EvansCommercial banks operate in a turbulent business environment and this calls for an understanding of their internal and external factors to enable them to increase their financial performance. This study’s objective was to examine the influence of selected firm characteristics on financial performance of commercial banks in Kenya. Precisely, the study sought to establish the influence of capital adequacy, board composition, management efficiency and working capital on financial performance of commercial banks in Kenya. The study was anchored on the buffer theory of capital adequacy, agency theory, performance theory and the liquidity-profitability trade-off theory. The study was carried out using a longitudinal design. The 42 commercial banks operating in Kenya by December 2019 were the study population. Secondary data from 2015-2019 was collected from Central Bank of Kenya’s yearly banking surveys, and the commercial banks’ financial statements. To analyse the collected data, the study applied the panel data regression model. The appropriate diagnostic tests were conducted before and after fitting of the model. The study findings established that capital adequacy had a significant and negative influence on financial performance measured through ROA (β = -0.3186, t = -5.43, p < 0.05), but had no significant influence on financial performance measured through ROE (β = 0.4091, t = 1.29, p = 0.200). The study also determined that board composition had no significant effect on the financial performance of the commercial banks as indicated by ROA (β = -0.2555, t = -0.11, p = 0.91) and ROE (β = -1.64, t = -0.13, p = 0.893). Moreover, the study findings determined that management efficiency had a significant and negative influence on financial performance measured through ROA (β = -0.2105, t = -11.43, p < 0.05) and ROE (β = -0.9342, t = -9.37, p < 0.05). The findings also established that working capital had no significant effect on the financial performance of the commercial banks as indicated by ROA (β = -0.7792, t = -1.01, p = 0.312) but had a significant and negative influence on the financial performance of the commercial banks as indicated by ROE (β = -8.3384, t = -2.00, p =0.047). The research offers the following recommendations based on its findings. First, the study recommends to Central bank of Kenya to be vigilant to ensure that the minimum CAR for commercial banks in Kenya is met by all banks. Regarding management efficiency, the study recommends to commercial banks in Kenya to have a suitable and organized policy framework to guarantee financial management efficiency. Lastly, the study recommends to commercial banks to carefully balance their working capital to balance the risk and returns that come from holding liquid assets and current liabilities.