BUDGETING PROCESS AND FINANCIAL PERFORMANCE OF THE COUNTY GOVERNMENT OF TRANS NZOIA, KENYA
BUDGETING PROCESS AND FINANCIAL PERFORMANCE OF THE COUNTY GOVERNMENT OF TRANS NZOIA, KENYA
Dennis Omina Panyako - Jomo Kenyatta University of Agriculture and Technology, Kenya
Julius Miroga PhD - Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
Budgeting process has become a fundamental issue for many organizations. In Kenya, budgeting process is increasingly recognized as a key tool for financial management. Despite the budgeting process, the county governments are still facing financial challenges notably budget deficits, stalled projects and pending bills. This suggests that the process through which the budget is controlled and monitored and evaluated could potentially help determine the financial outcomes of the county governments. It is on this basis that this paper examined the influence of budgeting process on the financial performance of the county government of Trans Nzoia County. The specific objectives were to determine the influence of budget control and auditing and budget monitoring and evaluation on the financial performance of the county Government of Trans Nzoia, Kenya. The paper was guided by the agency theory and employed the correlation design. The target population comprised of the senior and middle level employees drawn from the Finance and Economic Planning Department, Trade, Commerce and Industry Department, Public Service Management and Governance and County Assembly Committees in Trans Nzoia County. Data was collected using the questionnaires and analyzed using both the descriptive and inferential statistics. The results showed that there was a positive and moderate relationship between budget control and auditing and budget monitoring and evaluation and financial performance. 53.5% of the variance in financial performance was explained by budget control and auditing and budget monitoring and evaluation. It was concluded that 41.5% and 36.6% of the variances in financial performance of the county government of Trans Nzoia County were explained by budget control and auditing and budget monitoring and evaluation respectively. The findings may be used to formulating policies pertaining to budgeting process and financial performance in the county governments in Kenya.
