Nanjala Lydia Nyongesa

Masters of Business Administration (MBA)

1. Dr. Munir Muganda
2. Dr. Charles Kamau

ABSTRACT

Small and medium enterprises play an important role in the economy worldwide; providing employment to over 5.9 million people and accounting for over 98% of all businesses in Kenya. Many small and medium enterprises owners do not have formal financial management training and usually have limited resources hence face problems with regard to accounting control practices. The main objective of the study is to examine the influence of accounting control practices on the financial performance of Small and Medium Enterprises in Eldoret town, Kenya. Specifically the study will be guided by the following objectives; to determine the influence of cash controls on financial performance of small and medium enterprises, to establish the influence of revenue controls on financial performance of small and medium enterprises, to examine the influence of inventory controls on financial performance of small and medium enterprises and to examine the moderating effect of firm size on the relationship between accounting control practices and financial performance of small and medium enterprises . The study will adopt descriptive survey research design and will be based on Stakeholders theory. The target population will be 300 Small and medium enterprises owner/managers who are beneficiaries of Equity Bank Financial Knowledge for Africa (FIKA) Programme with between 0-50 employees operating in Eldoret town. These Small and medium enterprises are registered with the Ministry of Trade of Uasin Gishu County. A sample of 171 Small and Medium Enterprises will be selected by use of stratified random sampling. The data will be collected by use of structured questionnaire. Validity of the research instruments will be determined using test re-test. Cronbach’s alpha will be used to measure internal consistency with the alpha coefficient of above 0.70 being considered reliable. Data will be analysed by use of descriptive and inferential statistics. Multiple regression and Pearson correlation will be used for inferential statistics. Data will be presented by use of tables and figures. The findings will help in assessing the effect of cash controls, revenue controls and inventory controls on financial performance of Small and medium enterprise. This will help to improve in the financial management of Small and medium enterprises in Kenya.