MCOM Theses and Dissertations (2021)

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    The Investigation of the relationship between fraud risk management practices and firm value on Kenya listed companies
    (Strathmore University, 2021) Moindi, Enock Nyagwencha
    All organizations can be victims of fraud incidents in one way or another. Listed companies play a key role in the economic development of a country. The study investigated the relationship between the Fraud risk management practices and fim1 value of the listed companies in the Nairobi Security exchange, Kenya. Fraud risk management practices are part of the governance function of an organization that looks at the management of fraud risks in a company with the intention of mitigating, detecting and responding to the risks before occurring, when they occur and after occurring. The study collected data by use of a 5-point Linkert -scale questionnaire. The data on firm value (Tobin’s Q) from the audited financial statements of the companies as provided on the 2017-2018 investor handbook by NSE was collected. Confirmatory factor analysis was conducted to test for construct validity of the data. The correlation findings revealed a positive and significant relationship between fraud risk management practices (corporate governance fraud risk practice, Preventive FRMP and Responsive FRMP) and firm value (Tobin's Q). Other correlation findings indicated that detective FRMP and firm value show a positive but not significant relationship. The regression findings established that corporate governance fraud risk management practices have a positive and significant effect on firm value. But preventive, detective and responsive fraud risk management practices have a positive and not significant effect on fi1m value. While the relationship between firm size and firm value is negative and significant. The leverage and firm age have a positive and not significant effect on firm value. The study recommends an enhanced adoption of a devoted board and top management review of fraud incidents, whistleblowers, having an effective fraud department, implementing anti-fraud policy and a comprehensive ethics program. Other recommendations include; enhanced training on fraud risks, enhanced performance appraisal of fraud prevention, enhanced whistleblowing hotline system, progressive sanctions, disclosing the results of internal investigation to the regulator, prosecution of the fraud offender and recovery of the stolen funds.
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    The Effect of organizational culture on performance of employees in private universities in Kenya
    (Strathmiore University, 2021) Onyango, Brenda Pamela
    Culture is a key factor in achieving organizational goals and objectives. The main objective of this study was to determine the influence of organizational culture on employee performance in private universities in Kenya. The specific objectives were: to establish the effect of mission trait, adaptability trait, involvement trait and consistency trait on performance of employees in private universities in Kenya. The research study was anchored on Schein's model of Organizational Culture and the Goal-setting theory. A descriptive research design was used in conducting the study. Population of study was all the private universities in Kenya. A total sample of 196 respondents was drawn from the 14 private chartered universities in Kenya. Primary data was collected through a structured questionnaire which contained closed ended questions. The data collected was inspected for completeness and recorded in Statistical Package for Social Sciences (SPSS) Version 24 for analysis. Data collected was analyzed using descriptive statistics, correlation analysis and regression analysis. The results were that there was a positive correlation between involvement, consistency, adaptability and performance. However, there was a weak correlation between mission trait and performance of employees in private universities in Kenya. Further there was a strong coefficient of determination between culture and performance. This study contributes to theory by building on the theoretical framework such as Denison model and improving on the understanding of culture, and the possible effect that culture traits could have on employee performance. Empirically, the study guides management practices by diagnosing culture traits as the initial stages of managing people effectively. The findings of this study were limited to the culture traits by Denison and employee performance adopted by the researcher. The study was also limited to data collected using cross sectional survey, yet organizational culture may be affected by technological advancements, unprecedented occurrences and time which may affect how business is carried out in organizations. The response rate was limited by the conditions of COVID-19 pandemic.
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    The Relationship between unsystematic risk and returns at the Nairobi Securities Exchange
    (Strathmore University, 2021) Omeri, Daniel Nyangwono
    This study sought to assess the relationship between unsystematic risk and returns in the Kenyan stock market by looking at firms that are listed at the Nairobi Securities exchange. Unsystematic risk is a factor that investors consider when making investment choices. Whereas institutional investors diversity to minimize this risk, retail investors are exposed to unsystematic risk since they hold single stocks. This fanned the basis of this study as it sought further to explain the role that unsystematic risk plays in the determination of stock rettm1s at the Nairobi Securities Exchange. The period of study \vas between 2010 and20 19 with the objectives of examining the trend of unsystematic 1isk, investigating the forecasting ability of unsystematic risk on stock returns, and determine the optimum portfolio for an investor at the Nairobi Securities exchange. Portfolios were formed using a purposive sampling method as securities were organized in ascending order of their unsystematic risk values and portfolios selected in the increasing order of the unsystematic risk values. To calculate unsystematic 1isk, CAPM was used to control for firm-specific risk, which was determined as the standard deviation of the residuals from regressing excess rettm1s. This study adopted a positivism research philosophy and a quantitative research design. Secondary data was used in the study and was collected using a data capture sheet. The study used trend analysis, regression analysis, and a mean-variance model to analyze data. Three diagnostic tests, tests for normality, stationarity, and autocorrelation were conducted to ensure that the findings don't lead to a spurious regression. From the result of the trend analysis, value-weighted unsystematic risk showed an insignificant trend for the period of study. The study revealed that unsystematic risk is negatively related to the stock market rectums and cannot forecast stock market returns at NSE. Furthermore, an investor needed a portfolio of between 17 to 22 securities to achieve an optimum p01tfolio at Nairobi Securities Exchange. This study contributes to the existing knowledge of the relationship between unsystematic risk and stock market returns in developing and emerging capital markets.
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    The Influence of intrinsic motivation on employee performance in public organizations in Kenya
    (Strathmore University, 2021) Nyaga, Agatha Ngithi
    The purpose of this study was to establish the int1uence of intrinsic motivation on employee performance in public organizations in Kenya. Intrinsic motivation is important not only with a view to satisfy the needs and e::hrpectations of individual people who work in the public service but also create a feeling of belonging and commitment among the employees. Low motivation in public organizations has been cited as a major factor in Africa's human resource crisis, non-monetary motivators that foster team and organizational commitment are employee recognition, employee development, participatory environment, job security and job autonomy. A descriptive research design was adopted which \vas deemed to be the most appropriate since it permitted the researcher to describe the characteristics of the variables mentioned in the study. The research targeted employees of 65 public organizations in Nairobi County-Kenya which due to various constraints, due to Covid 19 pandemic restrictions only employees of 25 organizations were sampled. 375 employees were sampled using stratified random sampling. Primary data was collected by means of a structured questionnaire,which was self-administered. The data collected ·was analysed using descriptive statistics with the help of Statistical Package for Social Sciences (SPSS) to achieve the objectives of the study. Simple regression analysis and correlation analysis were used to analyse data. The study found that employee development, recognition, job autonomy and employee achievement motivation had significant and positive effect on employee performance. The study recommended that the overall management of public organizational input greater emphasis on recognition and non-monetary reward programs to attain higher employee performance. The management should also give the employees the autonomy to do their jobs which will improve employee attitude and in tum enhance employee performance. The study concluded that employee development has a positive effect on employee performance and that motivation inf1uences job performance but they there are many challenges associated with motivation that are essential to optimize employee performance. This study only focused on employee performance; future studies could focus on both employee and firm performance.
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    An Evaluation of the role of credit risk management on profitability on commercial banks in Kenya
    (Strathmore University, 2021) Gachini, Emmy Nyambura
    The effective management of risk is an important part of an inclusive approach to management of risk and is needed to ensure longevity of any banking institution. This study sought to examine credit risk management and its effect on the profitability of commercial banks in Kenya. Specifically the study addressed the following objectives, to examine the effect of Credit risk identification, the effect of Credit Risk Monitoring on profitability of listed commercial banks and to examine Credit risk analysis and its effect on profitability of their banks. The study was guided by three main theories namely Risk Management Theory, Information Asymmetry Theory and Agency Theory. This study adopted a quantitative research design, which helps in establishing the direction and magnitude of causal relationships. Measurements are taken on each variable over two or more distinct time periods which allowed to measure changes in chosen variables over time. The study found that different commercial banks consider credit risk identification, credit analysis and assessment, credit scoring mechanism, and risk monitoring and that credit analysts use the univariate accounting based credit scoring systems to compare key accounting ratios of specific clients versus industry ratios to show how a client's ratio differs from the industry standards or trends. At 5% level of significance and 95% level of confidence, capital adequacy ratio, loan to deposit ratio, non-performing loans ratio, management efficiency ratio and the net profit were all significant on profitability of commercial banks in Kenya. The study concluded that risk monitoring assists the banking administration to detect errors in good time and that internal auditors are greatly involved in the risk identification process where risk trigger questions are mostly used as identification methods. Statistically, there was a significant relationship between the effects of credit risk management and financial performance of commercial banks in Kenya. The study recommends that commercial banks should enhance usage of credit risk control practices in credit risk management to a very great extent.