School of Business & Public Management.

Effect Of Macroeconomic Factors On Financial Performance Of National Social Security Fund In Kenya

2020-03-11T13:01:16Z

Effect Of Macroeconomic Factors On Financial Performance Of National Social Security Fund In Kenya Wanyeki, Michael J G Studies have shown that firm’s financial performance is influenced by the business cycle. During boom times, firms and households commit larger proportions of their income flow to debt servicing with preference for leverage following a pro-cyclical pattern. Both the demand for leverage and firms' income will rise and fall with the business cycle assuming ceteris paribus. However, studies have proven this not be true from the mixed results on the relationship between the macroeconomic variables and performance of the firms. There are a number of studies globally that indicate the existence of a relationship between the macroeconomic variable and the firm’s financial performance. The National Social Security Fund (NSSF) is an institutional investor whose profitability depends on how other sectors are performing. The funds for instance made a loss of over Sh. 10 billion in 2016 due to the decline in the performance by listed firms at the Nairobi Security Exchange. The purpose of this study is to investigate the effect of macroeconomic factors on the financial performance of National Social Security Fund in Kenya. The objectives of the study are to determine the effect of foreign exchange rates on the financial performance, establish the effect of the inflation rate on the financial performance, assess the effect of level of interest rates on the financial performance and to establish the effect of the Gross Domestic Product on the financial performance of NSSF. The study adopts a descriptive research design in which the target population is financial publication and the Kenya National Bureau of Statistics library. Secondary data was obtained from the NSSF and Kenya Bureau of Statistics and the Central Bank. Data was analyzed using economic model and using tests as Johansen co integration test, Granger causality test and Vector Auto regressive model with the aid of STATA as the statistical software. A regression model was fitted to the data and the results of the study show that GDP, exchange rates and inflation rates had a positive and significant influence on the NSSF in Kenya. The study also shows that though Interest rates have a positive influence of the financial performance of NSFF in Kenya, its impact is insignificant compared to the rest of the variables in the study. There however exists co integrating relationship between the variables and the study shows that in the long run interest rates and inflation rates have a negative influence on the financial performance of NSSF in Kenya and become statistically insignificant.

Effect Of Entrepreneurial Orientation On Growth Of Small And Medium Size Enterprises In Narok Town

2020-03-11T12:23:58Z

Effect Of Entrepreneurial Orientation On Growth Of Small And Medium Size Enterprises In Narok Town Leboi, Letim The main purpose of this study was to establish the effect of entrepreneurial orientation on growth of small and medium enterprises in Narok town. Specifically, the study sought to establish the influence of innovativeness, entrepreneurial pro-activeness, and risk taking on growth of small and medium enterprises. This study is justified on the basis that even though the present body of literature has delved into relationship between entrepreneurial orientation and organizational growth, there is limited research on how it affects growth of small and medium enterprises. The study adopted Schumpeter’s innovation theory, resource-based theory, and theory of business strategy. Methodologically, the study adopted correlation research design, where the study targets 1,390 SMEs operating within Narok town. The sample size for this study comprised of 139 SMEs, which constitute of 10% of the target population. The study used random sampling owing to the homogeneity of the units of study. Data were collected by means of structured questionnaires. Statistical Packages for Social Sciences version 24 was used to run both descriptive and inferential statistics. Descriptive statistics were used to compute frequencies and to derive conclusions and generalizations regarding the population, while inferential statistics; multivariate linear regression analysis was being used to determine the association between the outcome and predictor variables. Valid and reliability tests were conducted and ascertained data measures were able to measure what they are supposed to measure (validity) and if data collection tools consistently measure phenomenon of interest. Data was presented in form of figures and tables. Analysis of data established existence of a significant (p< .05) and positive relationship between predictor variables (innovativeness, entrepreneurial proactiveness, and risk-taking) on enterprise growth for small and medium enterprises. The study recommends that that SMEs should leverage technological innovation as a basis of enhancing business processes, internal efficiency, and infusing new products and services. Moreover, SMEs should continuously monitor and asses their past and present processes with a view to predicting future trends and patterns in relation to anticipated consumer needs and consumption patterns and even though risk taking an important approach to business growth, there is need to incorporate risk management strategies to mitigate the effect of risks involved in borrowing.

Factors Affecting Investment Choices By Insurance Companies In Kenya

2020-03-04T12:28:40Z

Factors Affecting Investment Choices By Insurance Companies In Kenya Kibanga, Paul G Insurance companies as financial institutions play a significant role not only in the mobilisation of contractual savings but also in the efficient allocation of capital. Insurance companies depend on insurance premiums to raise money for their investments. Therefore, the need to develop a systematic and rational method of evaluating investment choices to maximise utility in the assets that they put their money in However, the choices on investment is affected by factors such as the market environment which influences the take up of investments being the micro and macroeconomic factors that influence growth. This study therefore sought to establish the factors affecting investment choices by insurance companies in Kenya. The study was guided by the following specific objectives; to examine the effects of liquidity on investment choices by insurance companies in Kenya; to determine the effect of investment horizon on investment choices by insurance companies in Kenya; to assess the effect of risk appetite on investment choices by insurance companies in Kenya; and to examine the effect of profitability on investment choices by insurance companies in Kenya. The study applied the use of descriptive and longitudinal design. The study was conducted in insurance companies in Kenya. The study used the census approach to select all the 48 insurance companies in Kenya. The study then sampled six insurance companies that are listed in the NSE. The study covered a 5-year period, from 2014 to 2018. The six selected being the ones with high gross written premium in the industry. The study collected secondary data from insurance companies’ websites, financial resort and IRA reports. Data analysis was carried out using STATA. Multiple regression analysis was performed to establish the association between the study variables. Correlation analysis and diagnostic tests were also performed. Presentation of the data was done by the use of tables. The study found that liquidity positively affects investment choices by insurance companies in Kenya; investment horizon positively affects investment choices by insurance companies in Kenya; risk appetite has a strong positive effect on the investment choices by insurance companies in Kenya and that profitability positively affects investment choices by insurance companies in Kenya. The study recommends management of insurance companies listed in the NSE should strive to achieve and maintain an optimal liquidity position that holds adequate cash/liquid resources for operational needs while the surplus liquid resources are invested. Listed insurance companies should have a well-maintained portfolio in order to achieve success. There is need for the companies to evaluate the various investments options available so as to ensure that the project chosen will give maximum value/profits.

Factors Influencing Social-environmental Responsibilities Disclosures In Financial Reports Of Kenyan Listed Firms

2020-02-26T09:21:21Z

Factors Influencing Social-environmental Responsibilities Disclosures In Financial Reports Of Kenyan Listed Firms Kemei, Ceasar C The objective of this study is to determine the factors influencing the social-environmental responsibilities disclosures in Annual financial reports of Kenyan listed firms. Social environmental responsibilities disclosures are voluntary therefore disclosed at the discretion of management and has been identified by various studies to improve image, reputation, enhance accountability, legitimacy and help manage stakeholders. Some studies have also shown that financial factors, governance characteristics, ownership characteristics and stakeholders, influence the extent of these disclosures, hence this study examined how the level of social environmental responsibilities disclosures in financial reports of Kenya listed firms is influenced by their size, profitability and leverage. Descriptive research design was used and secondary data was collected from 2009 to 2018 annual reports of 45 out of 48 targeted companies listed prior to 2009. The dependent variable is extent of disclosure is measured on total score from 39 disclosure items each with a rating between ‘0’ to ‘3’ based on absence and the degree of specificity or detail. The disclosure items was developed guided by Global Reporting Initiative index. STATA version 12 software was used to analyze the significance of the factors on level of Social environmental responsibilities disclosures. Exploratory, descriptive, diagnostic analysis were performed and the results showed that factors of firm’s size, leverage were positively significant and profitability is negatively significant in influencing the disclosure of social environmental responsibilities information on financial reports of Kenyan listed firms.