MST-Department of Accounting and Finance

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Browsing MST-Department of Accounting and Finance by Author "Achieng, Eunice"

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    Financial Management Practices and Financial Sustainability of Selected Non-Governmental Organizations in Kenya
    (Kenyatta University, 2025-06) Achieng, Eunice
    Non-governmental Organizations (NGOs) are vital for the nation's development as they contribute an average of 80 billion Kenyan Shillings annually to the Kenyan economy. A crucial element for the effective advancement of these NGOs is their financial sustainability. Nevertheless, numerous NGOs in Kenya were unable to obtain funding from donors, hindering their operational efficacy. The research main objective was to ascertain the impact of financial management methods on the financial sustainability of non-governmental organizations in Kenya. The research’s specific goal was to ascertain the impact of cash budgeting, financial reporting, and risk management on the financial sustainability of selected NGOs in Kenya. The study also determined the effect of government restrictions on the relationship between the financial sustainability of a selected non-governmental organizations in Kenya and their financial management techniques. The research was underpinned on the following theories: Resource Dependency Theory, Agency Theory, and RBV Theory. The investigation used an explanatory research design. 201 NGOs in Nairobi County were the study's target population. Nairobi County's 134 non-governmental organizations made up the study's sample size. Finance managers were the responders, and questionnaires were the main tool utilized gather data. Frequencies, percentages, means, and standard deviations exemplified descriptive statistics. Pearson's correlation analysis and panel regression analysis exemplify inferential statistics. The data was analyzed utilizing the SPSS (version 22). Data was displayed utilizing tables. Correlation analysis revealed that cash budgeting exhibited a moderate positive association with financial sustainability, financial reporting demonstrated a high positive correlation with financial sustainability, while risk management showed a large negative correlation with financial sustainability. FGLS regression results demonstrated that cash budgeting, financial reporting, and risk management exhibited a statistically significant negative impact on financial sustainability. The Whisman moderation test demonstrates that government restrictions favorably influence the relationship between financial management practices and the financial viability of NGOs. The research determined that proficient financial management methods, including cash budgeting, financial reporting, and risk management, substantially improve the financial sustainability of non-governmental organizations in Kenya. It recommended that NGOs adopt robust financial strategies to improve operational efficiency and long-term viability. Furthermore, there is need for government policies that support and strengthen financial practices within NGOs, ensuring accountability and transparency in their operations. Ultimately, sound financial management is identified as essential for the sustainability and effectiveness of NGOs in the country, highlighting the critical role of both organizational practices and supportive government regulations.