MCOM Theses and Dissertations (2013)

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An analysis of the Kenyan non-life insurance companies' technical efficiency
(Strathmore University, 2013-06) Wachira, Ndungu Wilson
The main objective of this study is to analyze the technical efficiencies of the Kenyan nonlife insurance companies during the period 2006 - 20I0 the period that the Kenyan Insurance Industry saw many changes. Data Envelopment Analysis (DEA) a non-parametric method is used in evaluating the technical efficiencies of Non-life insurers in Kenya during the study period. The study uses Equity Capital, Debt Capital and Total Expenses as inputs in the DEA model, while Gross Premium and Investments Income are used as outputs. It was observed that Kenyan non-life insurers operated at an average overall technical efficiency of 84.7%, pure technical efficiency of 93% and scale efficiency of 90%. Further, the study tests the hypothesis relating to the roles played by each of the variable used in the technical efficiency analysis of the Kenyan non-life insurer. It was observed that Kenyan non-life insurers with higher market share measured by gross premium tend to have higher efficiencies, which implies that non-life insurers in Kenya could increase their efficiencies by increasing their market share. This study adds to the knowledge of efficiency in the insurance industry in Kenya and on the knowledge of efficiency in the world. From an academic perspective, the particular contribution of this study lies in computing the technical efficiencies of the Kenyan non-life insurance companies by use of DEA model.
Business reactions to cyber security threats in the Kenya business environment
(Strathmore University, 2013) Onwong'a, Celestine Moige
The global wave of information and communication technologies (lCT) has brought enterprises not only enormous benefits, but also linked information threats. This thesis discusses the reactions of businesses to these cyber security threats in the Kenya business environment. More specifically it examines the characteristics of cyber security threats, the awareness levels of the Kenya business community to these threats, the manifestation of cyber security threats and the overall business reactions to the threats. The empirical study was conducted in businesses across 12 different sectors within Nairobi County between November 2012 and January 2013. It targeted IT specialists and internal auditors from each of the sampled businesses totaling 83 respondents. The research adopted a descriptive and correlational design. Data obtained was analyzed using descriptive statistics. The analytical results revealed that business reactions are pegged on the realization of the internet as a "double-edged sword", which provided many opportunities for individuals, organizations and governments to develop but with it brought endless opportunities for cyber criminals to exploit The research argues that cyber threats, with their unique characteristics, present new challenges to law enforcement, organizations and society as a whole. The study also finds that films have reacted to this 'new' risk by putting in place various cyber secu!i!YJn~as'Yl:5'.s.e.g.having in place policies and guidelines, installing various ----~~ ,- "'. . technological tools like anti-viruses with an aim to deter, prevent and detect cyber security threats. More is yet to be done by the various stakeholders in Kenya so as to secure the cyber environment. This study recommends an extension of the study to small and medium-sized organizations as it would enhance the generalizability of the findings. Different parts of the country could also be considered for future research for comparability purposes.
Cash dividend change announcement effects on share price returns for listed companies in Kenya
(Strathmore University, 2013) Otieno, Pauline Atieno
The policy of dividends has been a puzzle and knowing why companies and investors pay attention to dividends is still problematic. The study covered the period 2005 to 2012 and sought to establish the relationship between cash dividend change announcements and share price returns, the kind of relationship and if share price returns were affected differently between the periods before, during and after the Post Election Violence in Kenya. The study also analyzed the stock price reaction of firms listed on the Nairobi Securities Exchange that announced dividend changes before, during and after the Post- Election violence in Kenya. An event study methodology was used to assess the reaction of shares price returns to dividend change announcement. An abnormal performance around the event date was also analyzed using the daily closing share prices. Results revealed that dividend announcement had significant effect on share price returns for all the periods (before, during and after the crisis period). Further, the type of dividend announced had an effect on the share price returns as dividend decreases resulted to negative returns while dividend increases resulted to positive returns. From this, it was evident that dividend announcement had information content and the information content had significant effect on share price returns. The findings showed that investors became more conscious of the signals in dividends. This study will help managers in dividend policy decisions, as a reference point for investors and assist in future research on dividends as dividend announcement had an effect on shares and they acted as signals affecting share prices indicating investors were aware of dividends as a signal of firms’ future earnings.
Determinants of internal audit in the audit of strategic risk of state corporations in Kenya
(Strathmore University, 2013) Otieno, Victor Odindo
This study aims to establish the determinants of internal audit in the audit of strategic risk in state corporations in Kenya. It further examines the relationship between audit of strategic risk and the determinants of internal audit. A quantitative research approach was employed in this research. This was further complemented by a descriptive survey design. An email based questionnaire was used to collect data. Findings were drawn from the questionnaire survey distributed to 178 state corporations in Kenya targeting internal auditors. This study also provides descriptive information on the determinants of internal audit. The determinants of internal audit were found to play an important role in the audit of strategic risk. Management support of the functions of the internal audit as a determinant of internal audit was seen as the most influencing factor compared to the other determinants, The determinants included independence of the internal audit function, presence of a risk management unit, budgetary allocation to internal audit, and internal auditors' skills. Almost all the internal auditors questioned considered strategic risk as a key determinant in their audit mission. The findings disclose a clear picture of the determinants of internal audit in the audit of strategic risk, as well as an enhanced appreciation of the strategic role of internal audit in state corporations. This study reveals the determinants of internal audit in the audit of strategic risk of state corporations in Kenya. It also provides a framework that would guide internal auditors as they audit strategic risk in their organizations. Although this study was limited to state corporations in Kenya, the findings could be extended to different country settings which would provide great opportunities for future research.
E-Procurement Adoption Strategy in the Kenya Public Sector
(Strathmore University, 2013) Mohamed, Abdullahi Ahmed
E-procurement is continuously receiving interest from both public and private sectors. Analysts believe that adoption of e-procurement will lead to efficiency in the procurement process. The objective of this study was to establish e-procurement adoption strategy in the Kenya public sector. The study was conducted in government ministries within Nairobi County between November 2012 and January 2013. The study covered one e-procurement officer and one ICT officer from each of the sampled ministries totaling 42 respondents. This research adopted a descriptive design and it applies a quantitative and qualitative approach. The study was a purposive targeting the key informants; heads of procurement and ICT. The study established evidence to suggest that the Kenya public sector undertakes some forms of e-procurement because it is believed that certain cost reductions and benefits will arise. Results from the study also revealed that all the ministries have an e-procurement strategy in place, most of which are in the implementation stage- basically ‗‗wait and see‘‘ strategy. Further results indicated that 25.93% of the respondents strongly agreed that the strategies that are in place are adequate for the implementation of e- procurement within ministries, with a majority 55.56% of the respondents agreeing. This study could have implications within other organisations considering adopting e-procurement. This study recommends areas of further research to include study on other government agencies on and their levels of e-procurement adoption, a comparative study on the public sector and private sector on the adoption of e-procurement.
The effect of outsourcing decisions on organizational performance : a case study of the brewing industry in Kenya
(Strathmore University, 2013-08) Irumbi, Elizabeth Nyakaru
This study is designed to examine the relationship between outsourcing and organizational performance at East Africa Breweries Limited (EABL), a leading alcohol and non-alcoholic branded company in Kenya. For the purpose of analysis, organizational performance in this study refers to profitability, cost efficiency and productivity. Outsourcing is a management strategy by which an organization delegates major, non-core functions to specialized service providers. The main objective of carrying out this study is to establish the extent to which EABL's outsourcing of non-core functions affects its organizational performance. The researcher applied a correlation research design which is quantitative. The researcher analyzed the relationship between outsourcing and organizational performance to establish whether there is a positive or negative correlation and subsequently measured the effects on organization performance in terms of profitability, productivity and cost efficiency. The targeted population comprised of all senior management staff at EABL. The researcher collected data from the population through questionnaires and interviews. The results from the data analysis were interpreted and presented in the form of tables, graphs and continuous pros. The results of the data analysis showed that outsourcing decisions are implemented mainly as cost cutting business strategies. This is based on the respondents majority support for outsourcing decisions to improve on cost efficiency and OLS results indicating correlation between outsourcing and cost efficiency as most practical and achievable. The researcher recommends that other than cost savings, companies should explore other strategic reasons for outsourcing decisions including access to capabilities for instance human talent (intellectual property), operational systems and processes, or physical resources.
Effects of work environment on job satisfaction : a case of employees in banking industry in Kenya
(Strathmore University, 2013) Yebei, Nixon Kibet
The purpose of this study was to establish the effect of Work Environment on Job Satisfaction in the Banking Industry in Kenya. The main objective of this research was to establish the relationship between job satisfaction and work environment, and the extent to which work environment contribute to job satisfaction of employees in banking industry in Kenya. Specific objectives were; (l) to establish the effects of stressful competition on job satisfaction, (2) to identify the effect of role ambiguity on employee satisfaction, (3) to analyse how role conflict affects job satisfaction and (4) to gauge the role of organizational climate onjob satisfaction. This study was conducted between September 2013 to December 2013 within the Kenyan Banking industry. The study utilised stratified random sampling and selected 5 respondents from each bank using convenience sampling method. The major finding of the study was that Stressful Competition, Role Ambiguity, Role Conflict and Organizational climate affects job satisfaction strongly and positively by determining staff retention, quality of workmanship, work attendance rates and employee trust levels in the banks. Some ofthe recommendations from this study were; In order to maximize retention of bank staff, managers should avoid Stressful competition, Role ambiguity, Role conflict and Organizational climate at the work place since this study found out that it produces undesirable effects on the employees. For the interest of quality of workmanship displayed by the employees, managers should minimize the impact of negative work environment at the work place. This way the work quality produced by the employees would be superior compared to when role ambiguity is present in a work role. Organizational Climate in the work environment should be developed so as to work for employees as opposed to one which makes employees dissatisfied with work. Negative organizational climate produces unattractive results in employees like staff turnover, poor quality of workmanship, employee absenteeism and employee loss of trust in the company. These results can occasion great loss to a company if not mitigated or reversed altogether.
Evaluating value for money in procurement among government ministries in Kenya
(Strathmore University, 2013-03) Mochache, Geoffrey Ochako
This study aimed at evaluating value for money in procurement among government ministries in Kenya where there is a controlled procurement process by an Act of parliament. In the study, both qualitative and quantitative methods were used to answer the research objectives using data collected from the 42 ministries. It was established that, in regard to legal framework in public financial management, there is an average compliance to the procurement law. It was noted that the market price index tool (market price list) is not commonly used as required by the Public procurement oversight authority (PPOA). Competition through open tendering is not embraced hence alternative procurement methods which are exposed to abuse are commonly used. However, the oversight authority remains steadfast in carrying its mandate as required by the procurement Act as well as the institutional committees and structures within the ministries is adhered to by officers who are held responsible for procurement processes. The study establishes the extent to which value for money in public procurement has been achieved since implementation of the Procurement Law and also provides knowledge in public procurement so that scholars may appreciate how regulated systems mayor may not provide value for money in procurement process. For justification of public financial management, the study recommends for strengthening the legal framework especially in provision of better policy on maximum prices that ministries and other public entities should pay for goods, works and services in order to achieve the objectives of the procurement Act.
An examination of the audit quality difference among big 4 audit firms in Kenya (an audit committee's perspective)
(Strathmore University, 2013-06) Gitare, David K.
The purpose of this study is to examine whether audit quality differences exist among the Big 4 audit firms in Kenya. The study also evaluates the extent to which audit committees (ACs)review the quality of work of the external auditor as required by the Corporate Governance Guidelines(CGGs)provided by the Capital Markets Authority(CMA). One way Analysis of Variance(ANOVA)technique is used to evaluate audit quality differences among Big 4 audit firms based on the questionnaire responses obtained from AC members of companies quoted on the Nairobi Securities Exchange(NSE). Percentage analysis is used to assess the extent to which ACs perform certain quality review checks on the work of external auditors as per the Centre for Audit Quality(CAQ)tool. This study contributes to the body of audit quality literature by examining audit quality using a new tool developed for ACs by the Centre for Audit Quality(CAQ). This methodology is in contrast to other audit quality proxies such as frequency of litigation occurrences, audit fees. Audit tenure. size of discretionary accrual. Extent of IPO under pricing and frequency of financial statement restatements that have been used in prior audit quality research. The study finds that there are no statistically significant audit quality differences among the Big 4 audit firms in Kenya. The study confirms the proposition used in prior researches on audit quality that Big 4 audit firms provide homogeneous audit quality. The study also Ends that ACs, to a large extent, review the quality of work of external auditors as per the CAQ tool.
An exploratory study into the introduction of a successful derivatives market in Kenya
(Strathmore University, 2013) Noreh, Nancy Angano
The purpose of this study was to explore the factors that contribute to the success of a derivatives exchange and to establish whether these factors exist in Kenya which hopes to introduce its own derivatives exchange in the near future. Primary data was collected from capital market participants who included: stock brokers} investment banks} fund managers} investment advisors and regulators through the use of questionnaires; and secondary data from statistical databanks. A comparative study was used to analyse the data by benchmarking the indicators that explain the factors in a successful market and comparing the situation existing in Kenya in light of them. Descriptive analysis was also used for the primary data. The study found that economic development} political stability} a developed capital market} the types of products traded} infrastructural systems} a legal and regulatory framework} education of market participants} and many and active investors were important factors for the success of a derivatives exchange. The study also found that Kenya was not yet ready to establish a derivatives exchange which would be considered to be successful. Although Kenya is not yet ready to establish a derivatives exchange} measures can be put in place to facilitate the process of getting ready. Economic development and political stability may not be changed as easily} however putting in place the required regulatory framework and infrastructural systems and encouraging greater capital market development can be embarked on. This paper contributes to the body of literature by documenting the factors necessary for establishing a successful derivatives exchange in Kenya.
Factors that influence the establishment of venture capital firms in Kenya
(Strathmore University, 2013) Ngaruiya, Jane Wangari
The purpose of this study was to investigate factors that influence the establishment of venture capital firms in Kenya. The research design adopted was descriptive. Data was collected through semi-structured interviews from eight venture capitalists in 2012. Data obtained in the study was analysed through descriptive methods and content analysis. The objectives of the study were to identify the key factors that influence establishment of venture capital firms, challenges encountered as they set up and the sectors of the economy preferred. The results showed that macroeconomic variables specifically, Gross Domestic Product (GDP), interest rates and inflation, performance of the market, funds from investors, expected rate of return and networking among venture capitalists were the key factors considered in the set up of firms. Challenges encountered were. scarce or no protection of investor's property, lack of proper documentation by the entrepreneurs who venture capitalist considered to invest in their firms or business, lack of proper valuation methods to determine the worth of a venture and lack of qualified venture capital personnel. The most preferred sectors invested by the venture capitalists were identified as manufacturing and health care. The study has contributed to the body of knowledge as this is an area where there is scarce literature especially in the emerging markets. Areas for further study include, establishing if there is ail increase in the venture capital funds and the impact on the growth of the economy and to look further into the valuation methods used to determine a venture and determine the best practice for emerging markets.
Increasing foreign direct investments to Kenya: an analysis of underlying factors
(Strathmore University, 2013) Schützeichel, Paul Maria
This research studied a 14 year period of FDI inflows to Kenya (1998-2011) while especially focusing on the seven year period of increasing FDI inflows from 2005 to 2011. Prior to this period of growth, a trend of stagnating FDI inflows can be observed thus raising the question what factors exactly contributed to the rising FDI inflows. The study included two types of analyses: (1) an analysis of publicly available indices and (2) an analysis of primary data collected through questionnaires which intended to confirm or dismiss the findings of the secondary analysis. Through these analyses, the study revealed that the factors for the increasing FDI inflows were: Kenya’s role as regional hub and the increasing regional cooperation and integration, increasing market size and level of education, innovation and technology embraced within the local market, the ease of doing business in Kenya and infrastructure development. Surprisingly, other factors such as political stability, inflation, rule of law and corruption levels even deteriorated during the period of growth. In general, this research was conducted to explain the reasons behind the increasing FDI inflows to Kenya and thus reveals important information for fellow researchers, policy makers and foreign companies. The implications of the study were for the government to strongly focus on increased regional cooperation and integration and to further improve the ease of doing business among others. This research contributes to existing knowledge by establishing factors for increasing FDI inflows to developing countries in general and Kenya in specific.
The influence of international market entry strategies on the performance of manufacturing multinationals in Kenya
(Strathmore University, 2013) Gideon, Linah Nduku
The study was on the influence of international market entry strategies on the performance of manufacturing multinationals in Kenya. Mode of entry into an international market is the channel which organization that wants to operate in international markets employs to gain entry to a new international market. The choice for a particular entry mode is a critical determinant in the successful running of a foreign operation. Therefore, decisions of how to enter a foreign market can have a significant impact on the results. The research design used in this study was descriptive research design. There are 213 Multinational Corporations in Kenya. Out of the 213 Multinational Corporations, 108 firms are in the manufacturing sector and are located in Nairobi. The population of the study is therefore 108 firms. The sampling frame was retrieved from the online yellow pages. It is for this reason that the study considered 50% of the population. This yielded 54 firms. The study used a questionnaire as the preferred data collection tool. Descriptive statistics included frequencies and measures of central tendency mainly means and frequencies. Inferential statistics included regression modeling, t-test and Analysis of Variance (ANOVA). Results indicated that manufacturing multinationals used various international market strategies to venture into business. These strategies include licensing, whole owned subsidiaries, joint venture, exporting, direct investment and strategic alliances. Results further indicated that the firms used these market strategy entries to a large extent. Regression results indicated that market entry strategies had an influence on performance of the firm (profitability and market share). The study findings also indicated that there are various factors to consider behind the choice of a market entry strategy. These factors or considerations include resources available, company competence, competition in the market, size of the host country, availability of possible partnering firms with host country, host country requirements and state of firm development. The study concludes that manufacturing multinational firms used more than one market entry strategy to venture into business. This was probably to enhance the firm’s performance. It was also possible to conclude that the firms used licensing and direct investment to a very large extent and wholly owned subsidiaries, joint venture, franchising and strategic alliances to a large extent. It was possible to conclude that there are various factors that manufacturing multinational firms consider before choosing the market entry strategy to use. These factors are resources available, company competence, competition in the market, size of the host country, availability of possible partnering firms with host country, host country requirements and state of firm development. It was possible to conclude that all market entry strategies had a positive and significant relationship with performance of firms. The study recommended that the multinationals firms to carry out research on the market entry strategies before venturing into international market. This is to ensure they use the appropriate entry strategy to enhance the organization performance. The study also recommends that the management to evaluate the factors to consider when choosing an entry strategy thoroughly so as to make sure they know the market very well and that the management to evaluate the factors influencing the choice of market entry modes. This is to ensure that they choose the best mode.
A longitudinal study of corporate social responsibility disclosure amongst insurance companies in Kenya
(Strathmore University, 2013-06) Naliki, Nkoimu Mary
Most of the extant studies on social accounting have been conducted in developed and advanced economies. Due to differences in the socio-economic context between developed and developing economies, it is essential carry out research on Corporate Social Responsibility Disclosure (CSRD) in developing countries.This is therefore an empirical examination on disclosure of Corporate Social Responsibilty initiatives amongst insurance companies in Kenya where disclosure on social accounting is voluntary. The underlying theory of this study is legitimacy theory. This study has used content analysis and adopted instruments used in prior studies to measure the nature and extent of disclosure on Corporate Social Responsibility in the corporate annual reports of insurance companies during the period 2004 to 2011. The population for this study was drawn from registered insurance companies in Kenya as at 31st December 2012. The results of the study reveal that quite a large proportion of insurance companies made CSRD in the corporate annual reports (CARs) during the period under study. The theme most preferred by insurance companies is community development while the least preferred theme is energy. Insurance companies used a combination of monetary, non-monetary, declarative and pictorial disclosures. Most insurance companies preferred to disclose ' good news' only which may suggest that insurance the companies aim at influencing the public's perception about the companies. The findings of the study suggest that legitimacy theory explains why insurance companies voluntariy make CSRD in their CARs. The findings of the study show that gross premiums written, total assets, ownership structure, existence of board audit committee and return on assets are significantly related to CSRD in the sampled insurance companies in Kenya. Conversely, profit before tax, board composition, size of the audit firm and return on equity are not significantly related to CSRD in the sampled insurance companies. In addition the findings established that gross premiums written, ownership structure, existence of board audit committee, size of audit firm and return on assets are positively associated with CSRD in the sampled insurance companies. On the other hand, total assets , profit before tax, board composition and return on equity are negatively associated with CSRD in the sampled insurance companies.
Managerial entrenchment and firms financing choices: a study of non-financing firms listed on Kenya’s Nairobi Securities Exchange
(Strathmore University, 2013) Maimba, Jane Wanjeri
In this study, corporate governance is portrayed as spreading its tentacles wide into the public sector via the institutional framework. Therefore it would be myopic to view corporate governance within the confines of a company. Out of this acknowledgement, the study champions the cause of good corporate governance by highlighting the consequences of poor corporate governance. In particular, the study concerns itself with how poor corporate governance influences firms’ leverage decisions. In order to carry out this investigation, poor corporate governance is fashioned as managerial entrenchment and data for Kenyan firms listed on the N.S.E is collected. Upon subjecting Kenyan data to panel techniques, results reveal that entrenchment is rife among Kenyan companies. Entrenchment is perpetrated through ownership concentration, board size, CEO tenure, number of outsiders on a firm’s board, executive equity ownership levels and executive compensation. Nevertheless, its occurrence is due to the ineffectiveness of debt which is shown by managers’ ability to court more debt rather than less debt which contradicts entrenchment theory. Notwithstanding this, debt is still able to wield its disciplinary power when managers try to entrench themselves via a long tenure in office and executive pay. Further, results show that large shareholders in Kenyan companies are entrenched which encourages managerial entrenchment since they cause companies to adopt low debt levels. In addition, it emerges that in the agricultural segment of the N.S.E, managers exploit firms’ board size and a long tenure in office to entrench themselves. In the commercial and services segment, entrenchment is perpetrated through large shareholders and executive ownership. In the industrial and allied segment, managers take advantage of a long tenure in office and their shareholding in firms to act opportunistically. In the A.I.M.S segment, managers entrench themselves through board size and through manipulating the number of non-executives on their firms’ boards.
Motivation factors for earning management practice in Kenyan firms: case for public listed corporations.
(Strathmore University, 2013) Kaboyo, Onesmus Waiguru
The purpose of this study was to examine the extent to which earning management was practiced in Kenyan public listed corporations, Specifically to establish the motivation behind the practice of earnings management in public listed corporation in Kenya, establish the extent to which earnings management is practiced in the corporations, and also establish the relationship between incentives structures and the practice of earnings management in those corporations. The Agency and the stakeholder theories guided the study, exploratory research design was adopted. The study population included all the 56 public listed corporations. Simple random sampling method was used to get 33 public listed corporations as the representative sample. Questionnaire tools were used to collect the required information and the return rate was 100%. The respondents were staff who worked in the finance department. It was established that the factors more likely to be responsible for earnings management in public listed corporations in Kenya are; High shareholders‟ expectations in terms of high profitability from management; Poor financial performance of a company that negatively affects its reputation in the public; and Management incentives based on company performance induces managers to mis-report financial performance. The factors that require further investigations include; Purposeful possession of the company shares by management with intent to sell them to increase their wealth, Weak internal controls systems of the company, Management subjective judgment on adjustments of accounts receivable and inventory with no proper accounting procedures; and High external auditor turnover. The relationship between the factors influencing earning management practice in Kenyan firms‟ was established. However the coefficient of determinant (R2) was 0.31 suggesting a weak relationship between the dependent and the independent variables suggesting that there are other variables responsible for variations in earnings management other than those identified by this study. other ways listed companies could achieve earnings management in public listed companies include; Expectations of shareholders based on industry performance, Pressure for management to show good results, poor accounting systems, that are difficult to understand thereby giving room to alterations, to avoid the issue of profit warning, to prevent theft of company resources from being detected, to avoid payment of heavy taxes, to avoid alienating current investors and new investors, to avoid pressure to yield to workers asking for higher wages, to ensure company sustainability, Lack of qualified senior lever team, Motivation of company staff with good results , to increase goodwill of shares performing poorly in the stock exchange, to safeguard management reputation through financial performance, to meet the statutory requirements , to safeguard the Tenure of the head of finance , Poor application of international reporting standards, and Related party transactions. The study recommended regulation guiding share ownership by management and employees of respective firms is instituted by the regulating authorities. Further research was recommended on the other additional factors responsible for the earnings management practice since the regression model developed out of the factors identified by this study only accounted for 31 percent of the variations.
The relationship between safety audit effectiveness and client satisfaction : a case study of private schools in Embakasi Constituency, Nairobi, Kenya.
(Strathmore University, 2013) Oyoo, Willis Odhiambo
The purpose of this paper was to establish if there exists a relationship between safety audit effectiveness and client satisfaction amongst private schools in Embakasi constituency in Nairobi. To address this objective, a cross sectional design approach was adopted whereby the various heads of the school safety programs were surveyed using research questionnaires. Safety audit effectiveness was established by key indicators of effectiveness as identified from related literature. The indicators studied were: Standard Setting, Feedback Mechanism and Behavior Modification. The study found a strong positive relationship between Standard setting and client satisfaction. Between feedback mechanism and client satisfaction the study found a weak positive relationship which was not significant. Behavior Modification and client satisfaction depicted a negative relationship. The study also established that half the schools had a good understanding of the school safety and procedures manual despite about 68% of the institutions indicating that the levels of emergency preparedness in the institutions were not enhanced by the safety audits. Primary data was obtained by using a questionnaire which was submitted to the various schools heads of safety programs within Embakasi Constituency. Embakasi constituency consist of 38 private secondary schools and is the most populous zone in Nairobi County. The National Institute of Health (2006) in its study on emergency call workload and population density concluded that the higher the population density, the higher the emergency call rate. Feedback derived was used to draw relationships between the safety audit effectiveness and client satisfaction. The research further made recommendations on areas based on it findings it felt the safety officers would improve to enhance satisfaction. Additionally, the research has made proposals for additional research into client satisfaction with safety audits. This paper contributes to the body of occupational health and safety program within Kenya which was enacted in 2007 with an objective of minimizing business and human losses to organizations arising from emergencies. The findings give incite to what could be a contributor to the rising levels of emergencies in schools despite having legislation in place.
A study of the productivity of Value Added Tax (VAT) in Kenya
(Strathmore University, 2013) Mbithi, Mercy Mbovi
This study set out to establish Value Added Tax (VAT) productivity in Kenya as well as establish the factors that affect VAT productivity in Kenya. VAT productivity was measured using autoregressive models whereas the factors affecting VAT productivity were sourced from both taxpayers and the tax administration by use of questionnaires. Descriptive statistics by use of simple ratios and content analysis were used to analyze the questionnaires. It was found that VAT is responsive to changes in GDP, a contradiction with previous studies done in Kenya. Further analysis showed that VAT was rigid to changes in GDP up to the financial year 2004/05 and the years that brought about the shift in responsiveness were the last seven years running from 2005/06 to 20B/l2. However the positive trend was eroded in 2011112 due to the scrapping of the withholding VAT system. The VAT system did not possess most of the characteristics of a workable tax system of simplicity, convenient, certainty and productivity. The study also found that taxpayers faced challenging compliance costs and that there was neglect of the medium and small taxpayers who were found not to be compliant because of computational difficulties and lack of audit. The tax administration also faced difficulties in implementing VAT laws due inadequate resources. From the above Kenya Revenue Authority (KRA) needs to shift focus from revenue collection to coming up with systems that are more taxpayer oriented so as to enhance their compliance with VAT laws. A few reforms that are seen to have negatively impacted VAT collection need to be reviewed key.among them was the withholding VAT issue. This study contributes to the existing fe'S1ean::h on productivity of the Kenyan system by documenting the specific difficulties encountered in enforcing VAT laws as well as difficulties faced in complying with VAT laws. This study also brings to light the fact that VAT is responsive to GDP in contrast with previous studies.
A supply side view of factoring as a financing method for SMEs in Kenya
(Strathmore University, 2013) Maina, Kenneth Muchiri
The trade receivables of a typical SME constitute 21%-35% of its assets. Trade receivables provide an opportune alternative from the more traditional borrowing methods that SMEs use to obtain financing. That alternative is factoring. Factoring is a financial service enabling enterprises to sell their accounts receivable to a factoring company in exchange for cash. This study explores the supply side of factoring by banks in Kenya by looking at the profiles of enterprises receiving factoring services and the criteria that banks consider in making the decision to factor receivables. The study establishes that only about a third of banks in Kenya are offering factoring services. The study also finds that factoring services are provided exclusively to SMEs. Using correlation, the study also determines that in arriving at the decision to factor accounts receivable, banks in Kenya consider the creditworthiness of the SME’s accounts receivable. Factoring as a financing method draws its security from the receivables of the enterprise and not the financial health of the enterprise itself. Given the growth of factoring in the world, Kenya through its financial intermediaries, government and other agents must exploit the opportunity that factoring provides to drive the rapid growth of SMEs.
The Relationship between marketing programs and customer loyalty in the banking industry in Kenya
(Strathmore University, 2013)
The development of sound and vibrant commercial banks is a crucial engine for economic growth in Kenya. Over the past decade, the commercial banks sector has not only undergone fundamental growth but the environment has become highly competitive. To this end, commercial banks have to adopt sound strategies that will enhance sustainable growth and profitability. Modem theories such as commitment-trust theory emphasize customer loyalty as a driver of sustained profitability and further purport that relationship marketing programs are vital for attracting and retaining profitable customers. The purpose of this study was to analyze the relationship between marketing programs and customer loyalty in the banking industry in Kenya. The study adopted four objectives. The first objective sought to identify a Descriptive research design that was used for analysis. Primary data was used for analysis. The Nairobi area was identified as the sample frame. Stratified-Random sampling was adopted, four large banks were identified as strata, and data were collected randomly from each bank. Ordinary Least square was used for analysis. Five main variables were identified including relationship marketing, innovative products, and loyalty program as independent variables and customer loyalty as the dependent variable. The results showed that the majority of customers were satisfied with the services offered by the bank. Descriptive statistics results confirm that the majority were loyal to the banks and further agreed that relationship marketing was an important factor that increased customer satisfaction. ANOVA results revealed that customers ranked innovative products differently across the four banks. Regression results showed that identified relationship marketing, innovative products, and loyalty programs were significant determinants of customer loyalty. Relationship marketing has a coefficient of 0.66 which means that a unit increase in relationship marketing increases customer loyalty by 0.66. Innovative products and loyalty programs had a coefficient of 0.396 and 0.35 respectively. It was recommended that banks should focus on strategies that improve relationship marketing. Secondly, product innovation was identified as a competitive driver. It was recommended that commercial banks should focus their resources on innovating products that may enhance their competitive edge and improve both customer needs and expectations.

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