dc.description.abstract | The Constituency Development Fund (COF) was implemented in 2003 to address challenges of
unbalanced development and poverty at the grassroots level in Kenya. However, studies indicat~
that up to 40% of projects funded by the Fund in Kenya have failed, with up to 60% failure in
Ndhiwa Constituency which indicates poor performance. Whilst financial planning practices
have previously been shown to influence performance, the relationship between cash budgeting,
cash tlow projection and capital budgeting practices and the performance of Ndhiwa COF
funded projects is unknown. The study was anchored on Traditional development theory and
Agency theory. The purpose of this study was to establish the relationship between financial
planning practices and performance of Ndhiwa COF funded projects. Specifically the study
sought to; establish the role of cash budgeting in performance of the Ndhiwa COF-funded
projects, determine the relationship between cash flow projection and performance of the
Ndhiwa COF-funded projects, and to evaluate the influence of capital budgeting on performance
of Ndhiwa COF-funded projects. The study adopted correlational research design. Out of a total
population of 455 Project Management Committee (PMC) members, a sample of 213 PMC
I
members were selected using simple random sampling technique. Primary data were collected
using questionnaires. Through test-retest method, a reliability coefficient of 0.8 and content
validity index (CYI) of 0.774 were determined. The statistics were above the threshold of 0.7
suggesting that the questionnaire was reliable and valid. Multiple regression was used to analyse
the data. The study revealed that a unit increase in cash budgeting leads to a 0.794 significant
increase in performance of COF funded projects (p = 0.047). A unit Cash flow projection (p =
0.051) and capital budgeting (p = 0.061) were found to have insigni ficant positive relationship
with performance of COF funded projects. The study concluded that cash budgeting was a
significant determinant of performance of COF funded projects among the financial planning
practices. The study recommends that cash budgeting be applied more in COF funded projects.
This study's findings may contribute to the existing literature on COF funded projects and form a
basis for formulation of policies on management of community projects. | en_US |