Effect Of Financial Management Practices On Quality Of Education In Private Universities In Kenya

Abstract

Kenyans have developed the thirst for higher education and this has been on the rise owing to the fact that people with different skills are required and is also widely believed as the way to come out of poverty. This has led to the increase in enrolment in universities to rise thus making the public universities unable to accommodate all those people who intend to jo in the University, giving rise to private Universities. As the number of private universities rises up, the question of quality of education becomes debatable owing to the fact that financial resources are scarce. Quality of education is affected by many f actors among them financial resources which require to be managed properly. The aim of the current study was to evaluate the effect of financial management practices on quality of education in private universities in Kenya. The objectives of the study were to determine the effect of financial budgeting processes on the quality of education in private universities in Kenya, to establish the effect of financial reporting on the quality of education in private universities in Kenya, to determine the effect of financial record keeping on the quality of education in private universities in Kenya and to determine the effect of internal controls on the quality of education in private universities in Kenya. Stakeholder theory, agency theory and Allocation of resourc e theory were used. Descriptive survey design was adopted. The target population was on all the 18 private chartered universities from where four finance department staffs were selected from every institution. Structured questionnaires were used to collect primary data. Drop and pick later method was used as the data collection method, while pilot testing was done to test for validity and reliability of the instrument. Collected data was coded and then entered into an SPSS version 23.0 computer systems for analysis. Descriptive analysis was conducted where frequencies, means and percentages were obtained. To determine the relationship between the independent variables and the dependent variables, multiple regression analysis was done. Presentation of findin gs was done in forms of charts, figures, graphs, tables and narrations. The study established that the financial budgeting process affected the quality of education to a large extent. It further found that the financial reporting had a positive and signifi cant effect on the quality of education. The financial records keeping significantly affected the quality of education and that the internal control systems affected the quality of education through improving efficiency and effectiveness in the Universitie s’ performance and making sure that resources are allocated to the priority programmes. Generally, the financial management practices affected the quality of education in private universities in Kenya. The outcome of the study recommended that management o f the private universities should enhance financial reporting and the practice of financial record keeping more with a view of improving the quality of education.