Title:
REVENUE ADMINISTRATION STRATEGIES AND FINANCIAL PERFORMANCE OF COUNTY GOVERNMENT OF KISUMU, KENYA

Authors:
Hezbon Ayieko Ochuodho, Dominic Ngaba, Kenya

Abstract:

According to the Kenyan governing law inaugurated in 2010, devolved governments shall have reliable financial resources to enable them deliver effectively and efficiently on their constitutionally enshrined mandate. It empowers county governments to impose various taxes. Despite the dictates of the constitution, county governments have perennially recorded financial under-performance in regard to revenue inflow. Shortfalls in revenue realization hamper budget execution. Kisumu County is one of the devolved 47 Kenyan counties whose highest annual revenue collection stands at 64.7% for all its financial statements under review since its inception in the year 2013. Increasing cost of governance and decreasing revenue inflow necessitates the need to research on revenue administration strategies and financial performance aspect of revenue collection. The intention of the study was to examine the influence of Integrated Financial Management Information System, revenue diversification, internal control and employee motivation on financial performance of Kisumu County. The engaged target population was 49, comprising of senior revenue administration officers who were drawn from each of the seven sub-counties. Data collection was through questionnaire with the help of seven research assistants. Descriptive statistics assisted in quantitative analysis. Qualitative data was analysed through application of content analysis. Pearson correlation analysis model was applied to assess the associations and the relationship between dependent variables and independent variable. MS-Excel and SPSS aided the data analysis. The study found out that full usage of Integrated Financial Management Information System, revenue diversification; internal control and employee motivation have strong influence on performance of revenue collection of the County Government of Kisumu. The study recommends complete rollout of other modules of IFMIS. Standby technical team to speedily address technical challenges during revenue collection. Strategies to exhaustively tap and expand revenue sources should be in place. Internal control should be enhanced to reduce risk of revenue collection leakage. Employee motivation should also be given preferential consideration for increased financial performance.