Management efficiency focuses on changing and creating operational capabilities. This positively affects firm performance and reduces information asymmetry. Highability managers focus on innovating and increasing productivity, whereas low-ability managers make ineffective decisions. High managerial ability prompts scanning a firm’s environment to identify threats, opportunities, and competitive advantages. The main aim of this research was to determine management efficiency effect on ROA of DT-SACCOs in Kenya. The independent variables for the research were management efficiency, asset quality, liquidity, firm size and capital adequacy while the dependent variable was financial performance measured using ROA. The study was guided by xefficiency theory, agency theory as well as the stewardship theory. Descriptive research design was utilized in this research. The 175 DT-SACCOs in Kenya as at December 2021 served as target population. The study collected secondary data for five years (2017-2021) on an annual basis from SASRA and individual DT-SACCOs annual reports. Descriptive, correlation as well as regression analysis were undertaken and outcomes offered in tables followed by pertinent interpretation and discussion. The research discovered a 0.5301 R square value implying that 53.01% of changes in DT-SACCOs ROA can be described by the five variables chosen for this research. The multivariate regression analysis further revealed that individually, management efficiency unveiled a positive though not statistically significant influence on ROA. Asset quality has a negative effect on ROA of DT-SACCOs (β=-0.337, p=0.017). Firm liquidity exhibited a positive and significant effect on ROA (β=0.178, p=0.043). The other control variables which were SACCO size and capital adequacy displayed a positive and significant ROA influence as shown by (β=0.679, p=0.011) and (β=0.858, p=0.006) respectively. The study recommends that DT-SACCOs should work at improving their liquidity and their asset quality as they significantly affect ROA. Future research ought to focus on other financial institutions in Kenya to corroborate or refute the findings of this research.

show more