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FINANCIAL PLANNING PRACTICES AND FINANCIAL PERFORMANCE OF MANUFACTURING COMPANIES LISTED IN NAIROBI SECURITY EXCHANGE, KENYA
The study sought to assess the influence of financial planning practices on the financial performance of manufacturing companies listed in the Nairobi security exchange, Kenya. The study's specific objectives will be to assess the influence of financial planning. The study was guided by pecking order theory and adopted a causal research design with a target population comprised of nine (9) manufacturing companies operational during the study period. Thus the study used a census-sampling technique where all the manufacturing companies listed in the Nairobi security exchange were used. The study used data extraction form to collect data from the published financial statement from the firms. Annual panel data for 2015 to 2019 sourced from the Nairobi Stock Exchange was applied. Data were analyzed using descriptive statistics and inferential statistics, where the research hypotheses were tested at a 95% significance level. The study findings could be important to the management of manufacturing firms, other stakeholders, the government, scholars, and academicians. The results established that debt management had a weak negative insignificant relationship with financial performance. At the same time, net worth and long-term investment had a significant positive relationship with financial performance. The study concluded that long-term investment and net worth had a significant positive effect on financial performance. The study recommended that the firms reduce debt financing to a specific celling to reduce the negative impact on financial performance. Debt finance should also be converted to equity, and firms should invest more in high returns with low-risk investments to improve financial performance.
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