EFFECTS OF INTEGRATED FINANCIAL MANAGEMENT INFORMATION SYSTEM ON FINANCIAL PERFORMANCE OF COUNTY GOVERNMENT OF KWALE
Abstract
This study assessed the effect of Integrated Financial Management Information System on financial performance in Kwale County Government. The study specifically assessed how financial performance in the county is affected by four modules in the system including e-budgeting module, e-procurement module, automated cash management module, and automated financial reporting module. The study adopted descriptive research design and collected data through questionnaires from 137 out of 142 employees sampled through stratified random sampling from the finance and economic planning department, Kwale County Government. The reliability of the instrument was tested using Cronbach’s test and the results yielded an alpha index of 0.816. Data was analyzed using both descriptive (mean and standard deviation) and inferential (Chi-square, Cramer’s V, Spearman correlation and linear regression) statistics with the help of statistical package for social sciences, Version 21.0. The respondents were indifferent with regard to the impact of electronic budgeting and automated cash management while they affirmed the efficiency and effectiveness of electronic procurement and automated financial reporting. The results further suggested that almost 58.9% of the variation in financial performance of Kwale County Government was influenced by the county’s utilization of electronic budgeting, automated cash management, electronic procurement and automated financial reporting. The results revealed that electronic budgeting, automated cash management, electronic procurement and automated financial reporting had a positive and significant influence on financial performance of the county. The study concluded that improvements in the utilization of the four IFMIS modules would lead to improved financial performance at the county. The study recommended proper implementation and monitoring of the IFMIS system in order to avoid financial management challenges experienced by county governments. Further studies should focus on other factors influencing financial performance of county governments.
Key Words: e-budgeting, e-procurement, automated cash management, automated financial reporting, Financial Performance
CITATION: Ndzovu, S. M., & Ng’ang’a, P. (2019). Effects of integrated financial management information system on financial performance of county government of Kwale. The Strategic Journal of Business & Change Management, 6 (3), 11 – 27.
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DOI: http://dx.doi.org/10.61426/sjbcm.v6i3.1293
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