Effect of Integrated Financial Management Information System on the Effective Management of Public Funds in County Governments: A Case of Kiambu County

Abstract

The purpose of this study was to establish the effect of Integrated Financial Management Information System on the effective management of public funds in County Governments. The study was guided by the research objectives as follows: to establish the effectiveness of IFMIS on the transparency in the management of public funds in County Governments, to determine the effectiveness of IFMIS in accounting and financial reporting in County Governments and, to determine the effectiveness of IFMIS in the auditing of County Governments. This study was based on descriptive research design, which was used to capture the characteristics and dynamics of the population under study. The population of study comprised of 134 users of IFMIS in Kiambu County Government that is, officers in finance, procurement, accounts and audit. Probability sampling and stratified sampling were used to select a sample of 67 respondents. Quantitative data was analyzed using descriptive statistics supported by tables, frequency distributions, percentages, mean, mode and variance that was established through the use of SPSS. The findings on effectiveness of IFMIS on the transparency in the management of public funds revealed that IFMIS enhances transparency within the financial system, IFMIS enhances efficiency of the financial processes, IFMIS has improved accountability of public finances and IFMIS has enhanced easy access to financial information whenever required. It was also revealed that there is uncertainty of IFMIS leading to the effective management of Public Funds, IFMIS leading to easy access of financial information to external users and IFMIS improving service delivery to the Public. The findings on effectiveness of IFMIS in accounting and financial reporting revealed that IFMIS has improved the quality of financial reports, IFMIS has improved accuracy in financial reporting, IFMIS has improved government accounting processes and IFMIS has also improved the reliability of financial records and timely financial reporting in compliance with Financial Reporting Standards. However, there was uncertainty on IFMIS improving presentation of data for easy analysis and interpretation. The findings based on Effectiveness of IFMIS in the Auditing of County Governments revealed that IFMIS has led to the improvement of the audit process, IFMIS has improved the audit function of adding credibility to the financial statement and IFMIS has enabled easy access of financial data by the auditors. There was however uncertainty of IFMIS improving controls in the financial processes or whether it has enabled verification of the truth and fairness of the financial statements and IFMIS meeting the public expectations on the financial statements. It was concluded that the use of IFMIS Kiambu County has created transparency, enhanced efficiency, enhanced accountability of public finances, enhanced the quality of financial reports, improved accuracy in financial reporting, improved government accounting processes and improved auditors accessibility to financial data. However there was uncertainty on IFMIS improving the delivery of service to the public, IFMIS accurately disclosing the true financial position and IFMIS improving the reliability of financial statements for external users. It was recommended that Kiambu County should come up with strategies that will enable them plan, organize, direct and control public funds in the county, ensure that they are able to disclose true financial information to its members and they should also be to account for receipts and payment hence, increasing transparency and reducing misuse of funds and effectively use IFMIS to make it reliable and this will enable auditors to validate the true financial position of the county. The study sought to find the effect of integrated financial management information system on the effective management of public funds in county governments. The study was only done in Kiambu County. Therefore, more research should be done in other counties to identify the effect of integrated financial management information system on the effective management of public funds.