Browsing by Author "Manini, Muganda Munir"

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Accounting control practice and financial performance of small and medium enterprises in Eldoret town, Kenya
(KIBU, 2018-06-12) Nanjala, Lydia; Manini, Muganda Munir; Kamau, Charles
Small and medium enterprises are an important component in the economy worldwide; providing employment to over 5.9 million people and accounting for over 98% of all businesses in Kenya. Many small and medium enterprises owners do not have formal financial management training and usually have limited resources hence face problems with regard to accounting control practices. The main objective of the study was to examine the influence of accounting control practices and firm size on the financial performance of Small and Medium Enterprises in Eldoret town, Kenya. Specifically the study sought; to determine the influence of cash controls on financial performance of small and medium enterprises in Eldoret town; to establish the influence of revenue controls on financial performance of small and medium enterprises in Eldoret town; to examine the influence of inventory controls on financial performance of small and medium enterprises in Eldoret town and to examine the moderating influence of firm size on the relationship between accounting control practices and financial performance of small and medium enterprises in Eldoret town. The study adopted descriptive survey research design and was based on Stakeholders theory. The target population was 300 Small and medium enterprises owner/managers who were beneficiaries of Equity Bank Financial Knowledge for Africa (FIKA) Programme operating in Eldoret town. 171 owner/managers were sampled and selected by use of stratified random sampling. Data was collected by use of structured questionnaire. Validity of research instruments was determined using test re-test. Cronbach’s alpha was used to measure internal consistency with alpha coefficient of above 0.70 being considered reliable. Data was analysed by use of descriptive and inferential statistics. At 5 % significance level the results indicated a significantly strong positive correlation between cash controls and financial performance (R = 0.563 > 0.5, p = 0.001< 0.05). A significantly strong positive correlation between revenue controls and financial performance (R = 0.546 > 0.5, p = 0.001< 0.05). A significantly strong positive correlation between inventory controls and financial performance (R = 0.587 > 0.5, p = 0.001< 0.05). The study recommends that the managers of enterprises should ensure proper management of cash for the prosperity of the firm. The SMEs should establish a revenue control department with resources proportionate to the size of the organization. A firm needs to establish a sound inventory control system for determining inventory re-order and stock-levels. The managers of enterprises should work towards expanding the capacity of their businesses to be able to reap from the economies of scale.
Board characteristics and financial performance of listed manufacturing and allied firms in Kenya
(KIBU, 2018-06-12) Manini, Muganda Munir; Abdillahi, Umulkher Ali
The manufacturing sector in Kenya contributes significantly to the economic development of both developing and developed economies. The government in in its Big 4agenda seeks to raise the share of manufacturing sector from nine to 15 per cent of the gross domestic product (GDP) and create1.3 million manufacturing jobs by 2022. However, the percentage contribution of manufacturing sector to the gross domestic product and merchandise exports has stagnated. Further, the financial performance of the Kenyan manufacturing sector has been depreciating. The weak performance is attributed to low investments due to weak corporate governance practices in Kenya. The main objective of the study was to examine the influence of board characteristics on the financial performance of listed manufacturing and allied firms in Kenya. Specifically the study sought to examine the influence of board size, board diversity and board independence on financial performance of listed manufacturing and allied firms in Kenya. The study was based on the Stakeholders theory. In order to meet the objectives of this study an explanatory research design was employed utilizing a quantitative approach. The target population of the study comprised the ten listed manufacturing and allied companies on the Nairobi Securities Exchange. Through purposive sampling, seven listed manufacturing and allied firms were selected for the study. Audited annual reports for the ten year period from 2008 to 2017 were used. Data reliability was ensured by use of audited reports. Documentary evidence was employed by collecting the relevant information from the annual reports by use of a document schedule. The panel data fixed effect estimation model was applied for the data analysis. The collected data was analyzed using descriptive statistics and classical linear regression modeling. At 5% significance level the fixed effect result indicated board characteristics constructs namely board size, board diversity and board independence had a significant effect on the financial performance of listed manufacturing and allied firms in Kenya. The study recommends that listed manufacturing firms should enhance theirboard size, board diversity and board independence as the study found a significant relationship between board characteristics and financial performance. The results of the study have significant managerial and theoretical implications. Keywords: Board Characteristics, Corporate Governance manufacturing and allied firms, Big 4 Agenda, Kenya
Corporate Sustainability and Financial Performance of Manufacturing Firms in Uasin Gishu County, Kenya
(IOSR Journal of Business and Management, 2019-06-19) Odera, Elijah; Manini, Muganda Munir; Wanyama, Kadian Wanyonyi
In the contemporary production environment, manufacturing operations must take into account not only profit, but also environmental and social performance, in order to ensure the long-term development of the company. This study sought to establish the relationship between corporate sustainability and financial performance of manufacturing firms in Uasin Gishu County, Kenya. The study was guided by four objectives namely; to determine the effect of environmental practices on Financial performance of manufacturing firms; to examine the effect of corporate accountability on financial performance of manufacturing firms; To examine the moderating influence of government policy on the relationship between corporate sustainability and financial performance of manufacturing firms and to assess the effect of social justice of corporate sustainability on financial performance of manufacturing firms.. The study adopted descriptive survey design. The study population consisted of 3344 employees of all the 12 registered manufacturing firms in Uasin Gishu County by the KAM (Kenya Association of Manufactures), from which a representative sample of 357 employees was drawn. A structured questionnaire was used in data collection. The data was analyzed using both descriptive and inferential statistics. The findings of the study indicated that environmental practices had a statistically significant influence on financial performance(R = 0.688 > 0.5, p = 0.001< 0.05). The study also established that corporate accountability had a statistically significant influence on the on financial performance(R = 0.718 > 0.5, p = 0.001< 0.05). Further, the study established that social justice had a statistically significant influence on the financial performance of manufacturing firms(R = 0.660 > 0.5, p = 0.008< 0.05). Lastly, the results revealed that government policy had a statistically significant influence on the relationship between corporate sustainability and financial performance. The study recognizes that the variables used for this study are not exhaustive and therefore suggests that future research should include more triangulation utilizing other intervening and moderating variables as well as using alternative measures of all the study variables. Future research should also conduct longitudinal studies that would provide definite information about cause-and effect relationships as well as the changes in study variables over time. The study is further envisaged to add critical knowledge for academia which would inform top management in decision making process that could be used in policy formulation in the manufacturing sector as well as the government’s regulations on manufacturing firms.
Effect of Business Financing on the Performance of Small and Medium Enterprises in Lurambi Sub-County, Kenya
(European Journal of Business and Management, 2016-05-13) Manini, Muganda Munir; Abdillahi, Umulkher Ali; Wanyonyi, Kadian Wanyama; Simiyu, John
The purpose of this study was to examine the effect of sources of business financing on the financial performance of Small and Medium enterprises in Lurambi Sub-County. Specifically, the study sought to examine the effect of commercial loan-financing on the financial performance of Small and medium enterprises; to assess the effect of retained earnings financing on the financial performance of Small and medium enterprises and to establish the effect of trade credit financing on the financial performance of Small and medium enterprises in Lurambi Sub-County. Descriptive survey was used. The population of interest comprised of 450 small and medium enterprises in Lurambi Sub-County. Stratified random sampling was used to select 88 small and medium enterprises. The survey instrument used was questionnaires which were administered to owners and managers. Analysis of data was done using descriptive and inferential statistics. The study established that sources of business financing affected financial performance of small and medium enterprises significantly; commercial loan financing affected financial performance significantly; retained earnings financing affected financial performance significantly; trade credit financing affected financial performance of small and medium enterprises significantly. The study recommends that small and medium enterprises should make use of commercial loan financing, retained earnings financing and trade credit financing for them to realize higher levels of financial performance. The Government of Kenya should encourage lenders to share the financing risks with the government in order to reduce the cost of financing.
Effect of business financing on the performance of small and medium enterprises in Lurambi sub-county, Kenya
(European Journal of Business and Management, 2016) Manini, Muganda Munir; Abdillahi, Umulkher Ali; Wanyama, Kadian W.; Simiyu, John
The purpose of this study was to examine the effect of sources of business financing on the financial performance of Small and Medium enterprises in Lurambi Sub-County. Specifically, the study sought to examine the effect of commercial loan-financing on the financial performance of Small and medium enterprises; to assess the effect of retained earnings financing on the financial performance of Small and medium enterprises and to establish the effect of trade credit financing on the financial performance of Small and medium enterprises in Lurambi Sub-County. Descriptive survey was used. The population of interest comprised of 450 small and medium enterprises in Lurambi Sub-County. Stratified random sampling was used to select 88 small and medium enterprises. The survey instrument used was questionnaires which were administered to owners and managers. Analysis of data was done using descriptive and inferential statistics. The study established that sources of business financing affected financial performance of small and medium enterprises significantly; commercial loan financing affected financial performance significantly; retained earnings financing affected financial performance significantly; trade credit financing affected financial performance of small and medium enterprises significantly. The study recommends that small and medium enterprises should make use of commercial loan financing, retained earnings financing and trade credit financing for them to realize higher levels of financial performance. The Government of Kenya should encourage lenders to share the financing risks with the government in order to reduce the cost of financing.
Nexus between illicit financial flows and economic development
(KIBU, 2018-06-12) Abdillahi, Umulkher Ali; Manini, Muganda Munir
The international movement of money illegally or illicitly generated in developing countries has become a major issue in the development agenda. Reducing illicit financial flows (IFFs) is now a component of Goal 16 of the 2015 Sustainable Development Goals, as well as a staple of declarations from the G7 and G20.Kenya has been losing an average of Sh40 billion every year through illicit financial flows since 2011 as both government, local firms and multinationals engage in fraudulent schemes to avoid tax payments. Combined, this is an increase from Sh160 billion recorded in five years to 2011, an indication that illicit trade is gaining momentum in the country at the time the state is struggling to meet its revenue targets revised to Sh1.64 trillion. The purpose of this research is to explore the nexus between gross domestic product and illicit financial flows in Kenya. Specifically, the paper sought to discuss illicit financial flows in greater detail to strengthen our appreciation of the phenomenon and clarify some key concepts associated with it including an understanding of the linkages between gross domestic product and illicit financial flows. The findings showed that the reform agenda forillicit financial flows IFFs has four major components: reporting of profits; listing of beneficial ownership of assets; automatic exchange of tax information and anti-money laundering (AML) provisions. Though supported by the Kenyan government and with a potentially effective enforcement mechanism (blocking non-complying countries from access to the international banking system), AML rules have been consistently poorly implemented. This reflects the poor alignment of incentives and institutions, both private and public where many major international banks have paid large fines for systematically flouting the rule. The IFF reform agenda needs to more carefully assess those governance problems in order to be effective. Countermeasures include institution building strategies, international cooperation and information exchange, and fiscal transparency. Development practitioners need to understand the nature of the problem of illicit financial flows as an obstacle to development, and be aware of interventions that can reduce such flows.