Public Financial Reforms and Performance of Noncommercial State Corporations in Kenya
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Date
2023
Authors
Kimuli, Patricia Mumo
Journal Title
Journal ISSN
Volume Title
Publisher
Kenyatta University
Abstract
State owned corporations are very important in providing financial solutions in order
to foster public service delivery and economic development. However, irrespective of
this crucial role, these enterprises face numerous challenges, and they have over years
recorded dismal performance as a result of poor financial management, different
financial reporting formats, increased corruption, poor governance, political
interference and others. In the past, a number of initiatives were undertaken to
enhance the financial management among state corporations. These were initially
necessitated by the fact that the roles of the Parliament and Auditor General had been
previously ignored. This called for the reviewing of the existing PFM reforms and
frameworks since 2006. Review of these reforms highlighted the fact the
organizations are still faced by various challenges targeted to implement these
reforms. To counter these challenges, the corporations have adopted and implemented
various public financial reforms (PFRs). The purpose of the study was to ascertain
how the performance of State enterprises was impacted by the re-engineering of
IFMIS, budget creation and execution, accounting and reporting reforms, and internal
and external audit reforms. The non-commercial state corporations made up the
study's target population. Specifically, the study only focused on the state executive
agencies. Data collection was done using structured questionnaires. Descriptive
analysis helped to give thorough understanding of the respondents and the data they
provided. Mean, frequencies, and percentages were used in this. The study concluded
that IFMIS re-engineering help to increase accountability and transparency in the
management of funds. By this, it helps to curb fraudulence and corruption. Regarding
budget formulation and execution, the study concludes that effective implementation
of budget formulation and execution reforms ensures that the budgeted funds are
utilized for the planned projects, it ensures that the available resources are used
effectively, and gives the organizations a proper way of benchmarking the
performance of the organizations. On accounting and reporting reforms, the study
concludes that with proper accounting and reporting reforms, the noncommercial state
corporations would help to streamline the internal controls of the organizations so as
to foster transparency and accountability. On internal and external control reforms,
the study concludes that proper implementation of control reforms contributes to
performance of noncommercial state corporations. Effective internal audit, proper
control environment, and effective risk management contributes to increased
accountability and transparency in public funds management.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirement for the Award of the Degree of Master of Business Administration (Finance Option) in Kenyatta University, June 2023.
Keywords
Public Financial Reforms, Performance of Noncommercial State Corporations, Noncommercial State Corporations, Kenya