Budgetary Controls and Performance of Public Benefits Organizations in Kisumu County , Kenya

Abstract

Man y Public Benefit Organizations have emerged in Kisumu County, Kenya with an aim of offering solutions to the many problems being faced by the residents. Many managers of NGOs and other stakeholders do not appreciate the important role played by budgets in the financial performance of their organizations. This therefore calls for some conclusive research whose findings will help fill in the knowledge gap that currently exists about the role of budget in an organization. Due to the shaky and decreased funding to PB Os by donor organizations, transparency and budgetary control is emerging as a key issue in the sector. This stud y therefore aimed to achieve one objective; to determine the Relationship between budgetary controls and performance of non-governmental organizations in Kisumu County. This study employed multiple regressions to analyze the effect. The data collection involved the use of both quantitative and qualitative research methodology. I collected Primary data using a questionnaire to prompt information about budget control strategies of PBOs in Kisumu County. I successfully obtained data from 277 PBOs. The Target respondents were the Finance/Grants Officers and the Accountants of the target PBOs. Data was analyzed and presented in form of pie charts , descriptive tables and histograms. The data was analyzed using the Statistical Package for Social Sciences (SPSS). Before running the regression, data testing was conducted. To obtain a goodness-fit estimation, some tests were carried out to ensure statistical assumptions, such as linearity of variables, no correlation among independent variables, and no omitted variable problem. Multiple correlation coefficients was then calculated to determine the relationship between budgetary control measures and financial performance of PBOs in Kisumu County. The findings indicated that a considerable relationship exists between budgetary control strategies and performance of public benefit organizations indicating that the various budgetary control strategies affect performance of the PBOs at a considerable level. Recommendations were made that PBOs in Kisumu County should consider enhancing budgetary control measures for those who have and introducing the control measures for those who do not have. This is because the budgetary controls have a positive implication of performance and are critical at this time when the PBOs are experiencing shrinking funding from traditional European and American donors.