Effects of Budgeting Process on Financial Performance of County Government of Kwale in Kenya

Abstract

This study sought to assess the effects of budgeting process on financial performance of County Government of Kwale in Kenya. Descriptive research design was adopted for the study. The relationship between the budgeting process and financial performance was tested using correlation and Chi-square. The findings indicated that a significant majority of the respondents agreed that budgeting process has an effect to improved financial performance at the county. However, the opinion on whether county legislations contributed towards improved financial performance seemed to be equally divided. Chi-square and Cramer's tests indicated significant and strong associations between the various variables of the study. Further, the results of Pearson's Correlation at 5% level of significance indicated significant correlation between financial performance and budgeting process. Therefore, the study concluded that there was a significant moderate positive relationship between financial performance and budgeting process. The study recommends that the County Government of Kwale should put in place sound cash flow measures in order to sustain its operations, develop realistic budget projections, link budget programs and budget activities to set goals and targets, comply with budget timelines