Vol 4 Issue 2 October 2016-March 2017

Abstract: This paper investigates how interest rates are likely to have influenced the exchange rate movements in Kenya. It set to establish if interest rates have a significant contribution to the level of exchange rate or vice versa. It has also set out to determine if the International Fisher’s effect applies to Kenya with respect to the United States. Using a Vector Autoregressive model the paper estimated the relationship among the key variables i.e exchange rate and interest rates. The study made use of VAR regressions and multivariate Granger causality tests. From the VAR analysis using impulse responses, the research established that changes on the exchange rates are sensitive to all its past values upto the second lag but with varying degrees with the past one month value having the most significance. The change on exchange rate is also sensitive to the previous month’s change on the foreign interest rate. In addition the changes to the local interest rate are sensitive to the change in exchange rate in the third lag and also changes on its own lagged values in the second and third months respectively. In concluding the VAR estimate analysis, changes on the foreign interest rate are not sensitive to changes on any of the other variables including its own lagged values. The multivariate granger causality diagnosed that, changes on the local interest rate do not cause changes on the exchange rate while changes on the foreign interest rates do not cause changes in the exchange rate. In addition, changes on both the local and foreign interest rates jointly do not cause changes on the exchange rate. However, changes on exchange rate cause changes in the local interest rate while changes on the foreign interest rates do not cause changes in the local interest rate. In addition, changes on both the exchange rate and foreign interest rate jointly do cause changes on the local interest rate. Finally changes on exchange rates do not cause changes in the foreign interest rate while changes on the local interest rates do not cause changes in the foreign interest rate. Further, changes on both the exchange rate and local interest rate jointly do not cause changes on the foreign interest rate. In conclusion, the research also established that the International Fishers effect does not apply to Kenya with respect to the United State. Keywords: Vector Auto regression, Exchange rate, Interest rate parity and Fischers Effect. Title: Effects of Interest Rates on Foreign Exchange Rate in Kenya Author: BERNARD KIPKEMOI, GEORGE KOSIMBEI International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Efficient Procurement is a key driver in overall organizational performance. Despite the fact, research on procurement performance in the hotel industry has received little or no focus especially in the developing economies. This study therefore trove to establish the factors that affect procurement performance of star rated hotels in Mombasa County, Kenya. Focus was given to supplier development, information technology and staff competency to establish their impact on procurement performance. Stratified random sampling technique with respect to the unit of analysis which is the star rated hotels in Mombasa County was used to determine the sample size where the hotels were first grouped into their relevant stratums (5 star, 4 star, 3 star, 2 star and 1 star) and their actual representation in the population identified then 50% picked from each stratum resulting into 26 hotels. Questionnaires were used to collect primary data from the procurement managers as they are well versed with the data required. The data collected was analyzed using descriptive statistics to determine the mean, standard deviation, minimum and maximum of the various variables. Statistical package for social sciences (SPSS 20.0) was used in analyzing the data to find out the relation between the independent and the dependent variables. The relationship between the dependent and the independent variables was determined using a multiple regression analysis where all the three independent variables showed some level of significance at the 95% confidence level. The strength of the relationship between the variables was determined using a Pearson correlation coefficient (r). The independent variables (supplier development, information technology and staff competency) had a positive correlation to procurement performance hence an increase in the factors resulted to improved procurement performance of the star rated hotels. Therefore the procurement managers together with other cross sectional managers should focus on activities that improve the factors in question for the best procurement performance and ultimate competitiveness and success of the star rated hotels. Keywords: Procurement, Supplier Development, Information Technology, Staff Competency, Star Rated Hotel. Title: Factors Affecting Procurement Performance of Star Rated Hotels in Mombasa County, Kenya Author: Everline Chebet, Dr. Anwar Ahmed, Samson Kitheka International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Project management requires effective financial management. Financial Sustainability is therefore an integral part of the project management. The objective of the study was to analyze financial sustainability of community based organizations, a survey of selected community based organizations. The study was guided by the following specific objectives; Establish the diversity of funding sources and their characteristics; Examine the practices and challenges of financial sustainability in relation to financial competence and own income generation; Suggest ways towards sustainable financial management practices Kenya. Descriptive survey research design was used targeting 154 registered and active and registered CB0s in Mt. Elgon Sub County. A sample size of 110 obtained using simple random sampling was used and data collected using questionnaires. Data was analyzed using both descriptive and inferential statistics with the aid of regression analysis. The findings revealed that diversity of funding sources (r = 0.787, α = 0.05); practices and challenges of project management (r = 0.478, α = 0.05) and Sustainable financial management practices (r = 0.435, α = 0.05) had significant effects on financial sustainability of CBOs. The results indicated that the Practices and challenges of the projects was the most important factor. The study recommended that CBOs should be engaging in income generation activities as for-profit organization. Emphasis should also be placed on hiring staff that are competent. This is because competence of staff significantly affects the financial sustainability of CBOs. Nevertheless, the staff should be frequently trained to ensure continued competence level. Keywords: Sustainability, Finance, community based organisation, Harambee. Title: Financial Sustainability of Community Based Organizations’ in Mt. Elgon Sub-County, Kenya Author: Alex Cheptot, Dr. Mike Iravo, Mr. Robert Wamalwa Wandera International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: The purpose of the study was to examine the influence of public procurement on CDF performance in Kenya; a case of Mt. Elgon Constituency in Bungoma County. The research questions therefore were; to establish the effect of procurement legislation implementation on procurement performance in CDF Committees in Kenya; to determine the challenges facing the implementation of procurement legislation in CDF Committees in Kenya. The study utilized explanatory research design to gather both qualitative and quantitative data from sampled respondents in Mt. Elgon constituency. The population of the study was 290 institutions that have been funded by the Mt. Elgon CDF since CDF inception. The study used primary data which was collected through use of a questionnaire. A five point Likert scale questionnaire was used. Also a Yes or No structured questionnaire was also administered. The data collected was analyzed using descriptive statistics inferential statistics. The descriptive technique was used to generate frequencies, mean and percentages while inferential statistics were generated the fitness of the model and regression of coefficients. The findings concluded that the procurement performance affected procurement legislation and the performance of constituency development fund (CDF). Effects of Procurement Legislation on procurement performance were found to be statistically significant with a positive impact on the importance of procurement performance. Results also indicate that Procurement management had positive and significant effect on CDF performance. The study recommends that a summarized regulatory framework for CDF procurement management be prepared by policy makers. Through legislation, the government should enact comprehensive laws to regulate procurement functions and outline clear policy and procedures to be followed by procurement entities as this will enhance accountability and transparency. The study also recommends that the government should employ professional auditors to undertake public procurement audit and facilitate their continuous training to ensure they are well equipped with necessary technical skills. These will ensure effectiveness of public procurement audit. The study also recommends that more public auditors be trained on public procurement audit and the CDF managers be exposed to audit as a positive management tool. In conclusion, the research will assist practitioners and policy makers both in the devolved and national governments to assess the effectiveness and efficiency of CDF management; hence, wisely address pertinent issues affecting effective performance of the CDF kitty in the constituencies. Keywords: Public procurement, Constituency development fund, Mt. elgon constituency, Performance. Title: Effect of Public Procurement on Performance of Constituency Development Fund in Kenya: A Case of Mt. Elgon Constituency Author: Moses Kwaram Kirui, Dr. Elizabeth Nambuswa International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Corporate dividend payout policy has been an issue of interest in the financial literature for a long time. Despite the vast research on the topic, it remains debatable. For this reason, dividend policy has become one of the most debated topics in corporate finance and among many academics. Over forty years have been spent researching dividend policy, and thus far, it has not been resolved. Several theories have been proposed to explain the relevance of dividend policy and whether it affects shareholders wealth, but there has not been a universal agreement. It is because of this that the current study sought to investigate the determinants of share holders’ wealth among listed financial firms’ on the Nairobi Securities Exchange. The study specifically investigated the effect of dividend payout, leverage and growth on shareholders wealth. The study also investigated the effect of firm size as a control variable on shareholders wealth. The study was hinged on the Dividend relevance theory, and the signaling effect of dividend. The study adopted descriptive survey research design. Data was analyzed using SPSS version 22. The study sought to establish the effect of dividend payout on share holders’ wealth among listed financial firms’ on the Nairobi Securities Exchange. The study concludes that shareholders wealth measured as market price per share is positively and insignificantly associated with the amounts of dividends paid by the firms. The amount of dividends paid is also positively and insignificantly related to shareholders wealth. The study also sought to determine the effect of leverage on share holders’ wealth among listed financial firms on the Nairobi Securities Exchange. The study concludes that Leverage is negatively and insignificantly associated with shareholders wealth. Leverage is also negatively and significantly related to shareholders wealth. The study sought to determine the effect of growth on shareholder’s wealth among listed financial firms’ on the Nairobi Securities Exchange. The study concludes that growth of the firm is positively and significantly associated with shareholders wealth. Furthermore, growth is positively and insignificantly related to shareholders wealth. The study also sought to find out the effect of firm size as a control variable on share holders’ wealth among financial firms’ listed on the Nairobi Securities Exchange. The study findings led to the conclusion that firm size is positively and significantly associated with the shareholders wealth. Firm size also controls the relationship between shareholders wealth and dividend. Following the findings and conclusions, the study recommends that both current and potential investors who are predicting future shareholders wealth in a firm should take note of the firm’s financial leverage and size. They should expect higher shareholders wealth (Market price of the share) among firms with high assets as well as firms with low leverage ratio. Another recommendation made by the study is that managers should incorporate policies to pay low amounts of dividends when their firms have high leverage. This will in turn lead to an improvement in the shareholders wealth. The study also recommended that the government should make policies that encourage dividend payout when there is a need to raise more revenue from dividend withholding tax. Keywords: Financial Literature, SPSS, Market price of the share. Title: Determinants of Share Holders’ Wealth among Listed Financial Firms’ on the Nairobi Securities Exchange Author: Imukuny Geoffrey, Dr Mutua Mbithi, Maniagi Musiega International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Drug and substance abuse is a global problem and is one of the major problems affecting the youth both in school and out of school. This study sought to establish the influence of literacy levels on drug and substance abuse among the youth in Kiambu County, Kenya. The researcher used cross sectional survey research design that involves obtaining data at one point in time. Data was analyzed using Data was analyzed using feminist stand point theories that argue for the ‘starting off thought’, which means analyzing data starting from the lives and experiences of the youth in Ndeiya Ward. The study findings showed that drug and substance abuse among the youth are influenced by literacy level. Key recommendations made are; effects of drug and substance abuse be part of the syllabus from primary school, media be used to emphasize on the effects of drug abuse, the Government to create employment for the youth and train youth on time management and entrepreneurship, reinforcement of various laws that regulate production and consumption of drugs and substance of abuse and sensitize parents on good role modeling. Keywords: Literacy Level, Drug and Substance Abuse, Youths in Kenya. Title: INFLUENCE OF LITERACY LEVELS ON DRUG AND SUBSTANCE ABUSE AMONG THE YOUTH IN KIAMBU COUNTY, KENYA Author: Nelson M Mbiyu, Dr. Kepha Ombui International Journal of Management and Commerce Innovations, ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Organizations are open systems. They operate and survive within an external environment comprising competitors, the economy, suppliers, customers, technological requirements, government and communities. Business environmental conditions currently facing firms are dynamic. This demands more timely and effective competitive actions and responses. Strategic responses position the firm thus giving it a competitive advantage over its competitors. This study was conducted to establish the response strategies adopted by Murata SACCO in responding to changes in the business environment. Primary and secondary data were gathered for the study. The study adopted a content analysis method to analyze the data collected. According to the study findings, Murata was affected by new technologies, high expectations from their clients, increased Government of Kenya supervision, weather fluctuations and increased competition. Murata responded by designing strategies to remain relevant, have a competitive edge and increase its market share. Some of the strategies that the Sacco devised are; marketing and advertisements, diversification, rebranding and partnership. Other strategies are; differentiation, cost leadership and diversification. The study recommended Murata to invest more in the latest technology and start agency banking as a strategy of expanding its market share and product differentiation. Due to limitations of the study, suggestions for further research have been recommended. Keywords: Strategic response, Recognition, Promotion. Title: Strategic Responses to the Changes in the Business Environment; a Case Study Murata Sacco, Maragua Branch Author: Ng’ang’a Charles Mwangi, Dr. Kepha Ombui International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: This study investigates the effect of automation of financial management processes using information communication technology (ICT) on the financial management of the county treasury, county government of Trans-Nzoia. The recognition of the noble role of automating the financial management cannot be gainsaid. In the Last decade, the Kenyan government has increased spending in developing the ICT sector compared to other countries in the sub-saharan Africa with similar GDP per capita. Kenya spends a significant amount on ICT based financial management systems such as LAIFOM and IFMIS.ICT cuts across all sectors of the economy. Specifically, this study seeks to establish the effect of automation of financial processes using ICT tools such as IFMIS on the financial performance through improved budgeting processes, revenue management, financial records and information handling, procurement to payment process. The county governments of Trans-Nzoia treasury employees who interact with the system were the target population where all the 50 employees were included through a census where purposive sampling technique was applied. Questionnaires and interviews schedules were the major data collection instruments. Collected data was analyzed using descriptive (frequency and percentage) method. Having analyzed the data and the findings the researcher came up with the following conclusions as possible remedial measures to be taken in the organization. The study concluded that: County Treasury use Internet to support financial Management. It also concluded that ICT/LAIFOMS enables tracking the performance of the revenue collection process. Furthermore it concluded that the use of IFMIS and LAIFOMS ensures timely financial reporting e.g quarterly. Finally the study recommends that use of ICT facilities. E.g., e-mails, SMS, for communication has resorted into quick decisions making at the county government hence enhancing a quicker budget making and the use of ICT for correspondent by the County government has led to an increase in public participation in the activities and programs of the county government especially during the budget making process. From the findings the researcher recommends that the organization should improve on ICT system and Databases to be used in budgeting and procurement processes. It also recommends that automation of the revenue management process should be improved to enhance efficiency in the revenue collection process. It also recommends that the organization to maximize employee’s multi-dimensional abilities for better performance. Finally, It recommends that the automation of the budget making process should enabled the use of a single chart of accounts (SCOA) hence making and automation of the procurement process through the use of e-procurement platform should achieved an end to end process from requisition to Payments. The study suggested that further study be done on effect of automation of financial management systems on financial performance of County Governments in Trans-Nzoia County Government. Keywords: Automation, Financial Management Systems, Financial Performance & Information Communication Technology. Title: Effect of Automation of Financial Management Systems on Financial Performance of County Government of Trans-Nzoia Author: Hezron Kiplagat Kemboi, Dr. Willy Muturi International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: This study was set to investigate the internal factors that influence procurement procedures in public secondary schools in Bungoma County. The study was guided by the following specific objective; to establish the effect ICT adoption on procurement process in public secondary schools in Bungoma County. The study was guided by the path goal leadership theory which postulates that. The theory is based on the premise that an employee’s perception of expectancies between his effort and performance is greatly affected by a leader’s behavior. The leaders helped group members in attaining rewards by clarifying the paths to goals and removing obstacles to performance. The study employed a descriptive research design. The target population was 62 schools which is 30% of 206 public secondary schools in the County. Data was collected using self-administered questionnaires and interview schedules and analyzed using descriptive statistics. The study was significant in the sense that, it has provided information that may enhance sound procurement procedures in public institutions and particularly secondary schools. This study was also added to the existing reservoir of knowledge in the area of public procurement. Keywords: Public Secondary Schools, Procurement Practices, procurement process, Bungoma County. Title: Internal Factors affecting Procurement Practices in Public Secondary Schools in Bungoma County, Kenya Author: Bivern Wasike Wekesa, Gregory Namusonge, Elizabeth Nambuswa International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Supplier development has become a critical factor for the Procurement function’s success. Supplier development allows a buying firm with regard to its supplier to increase the performance and/or capabilities of the supplier to meet the buying firm’s supply needs through efficiency and effectiveness of its operations. It is one mechanism used to enable fast lead times, control of inventory, relationship and production costs through the supply chain. The main purpose of the study is to determine the effect of supplier development on purchasing performance. Specific objective is to determine the effect of supplier incentives on purchasing performance. The study based on the Theory of Constraints, Transaction cost Economies and Resource Dependence Theories. Descriptive research design through a case study on Nzoia Sugar Company in Bungoma County was used to undertake the study. The study targeted Department Heads, Heads of sections and section officers. Data was collected from a 96 out of the initial target of 116 respondents. The research instrument was tested for reliability by computing Cronbach alpha statistical tests which yielded a score of 0.791. Data was cleaned descriptive and inferential statistics. Descriptive statistics like means, frequencies and percentages were used. In addition, Pearson correlation was used to show the correlation between the variables which revealed a positive and significant results between supplier incentive and procurement performance (p<0.01, r = 0.716. Multiple regression was used to test the study hypothesis when significant at the 0.01 level had F=23.790, Sig=0.000, p<0.05).The study recommends that Nzoia Sugar Company should focus on identifying classifications of suppliers and ensure that they communicate this throughout the company, and adopt a supplier development matrix for its monitoring purposes. This study will help businesses develop the right capacities and strategies in the key aspects that sugar manufacturing companies can use for developing suppliers and form a basis on which other researchers can make reference Keywords: Supplier development, Procurement performance, Supplier incentives, Bungoma County. Title: Effects of Supplier Development on Procurement Performance in Bungoma County: A case of Nzoia Sugar Company Author: Juma Ben Cheboss, Gregory Namusonge, Elizabeth Nambuswa International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: The study evaluated the factors affecting the effectiveness of internal control systems used by the county governments in Kenya through a case study of Elgeyo Marakwet County which affects their overall performance and rating. In Kenya evidence shows that despite many organizations having internal control systems, assets are not properly safeguarded. Although studies have been done on the types of internal control systems adopted by various organizations in Kenya, no study have been done so far on the factors affecting the effectiveness of internal control systems adopted by the county governments. There has been a lot of hue and cry from the public concerning the running of county governments that has led to loss of public funds resulting to slowed development in the various counties contrary to what the public envisaged about devolved governments. The study was guided by the following research objectives: To establish if Elgeyo Marakwet County has competent personnel, to find out if the county personnel have supportive attitude towards internal control systems, to establish the types of internal control techniques used by the County Government and to find out if there is a continuous monitoring and evaluation control established in the County Government. The study of this kind will help the researcher to give good advice to the county governments on the factors affecting the effectiveness of the current internal control systems being used and suggest to them the best practice and systems to adopt in order for it to achieve its objectives by sealing all the corruption loopholes that may be present. The research used a case study research design and it targeted 50 respondents drawn from the 4 sub-county offices and governor’s office. Semi-structured questionnaires were used as the data collection instruments. Data collected was then analysed using excel spreadsheets and results presented in tables and pie charts. Keywords: Internal Control Systems, County governments, Elgeyo Marakwet, Internal control techniques. Title: Factors Affecting Effectivenes of Internal Control Systems in the County Governments in Kenya: The case of Elgeyo Marakwet County Author: Daniel Kipchumba Kiptum, Dr. Willy Muturi International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: Micro and Small Enterprises refer to those enterprises that employ less than 50 employees. Micro enterprises employ 0-9 employees, while small enterprises employ 10 – 49 employees and they account for 75 per cent of the total employment and 30 per cent of the Kenya’s gross domestic product. However, two thirds of micro and small enterprises fail within the first few months of operation. Majority of micro and small enterprises are characterized by low growth rate and transition to medium and large enterprises. Access to expansion capital has been adversely cited as a major cause of the low levels of growth. This study seeks to assess how financial management practices affects performance of micro and small enterprises in Busia Town, Kenya. Specific objectives of the study was: to establish the effects of working capital management, Cash Flow Management, asset management and financial reporting on performance of micro and small enterprises. Descriptive research design was adopted to guide the research. The target population for the study was 712 small scale traders in Busia Town from which a sample of 88 respondents was selected using the simple random sampling technique. Data was collected using a questionnaire designed and administered to the business owner managers by the researcher. The data collected was coded and cleaned before analysis. Analysis of data on the other hand was done using both descriptive and inferential statistics. Descriptive statistics such as mean mode, frequency counts and percentages was used to summarize responses. Relationship between variables as well as statistical inferences was done using a multiple regression analysis. Regression model was used in determining relationship between variables. The study is expected to shed light on how micro and small traders in Busia Town manage their finances and whether and how this enhance or hinder business performance. Keywords: Firm Performance, Financial Management Practices, MSEs. Title: FINANCIAL MANAGEMENT PRACTICES AND FIRM PERFORMANCE AMONG MICRO AND SMALL ENTERPRISES IN BUSIA TOWN, KENYA Author: Gabriel Esonga Erambo, Jonathan Mwau Mulwa, Josiah Roman Aketch, Oscar Sangoro, Wilbrodah Mutsoli Muchibi International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: The study sought to investigate on influence of Bank regulation on loan nonperformance among commercial banks in Kenya and thereafter come up with recommendations. The objective of the study was to assess the determinants of loan nonperformance among commercial banks in Kenya. Census was adopted where data was obtained from 43 commercial banks in Kenya and analysed using SPSS by applying both correlation and regression to show relationship between the variables. The study recommends that bank supervisory boards should ensure the implementation of the Banking industry reforms that will help enhance capital adequacy among commercial bank in Kenya to ensure reduction in non-performing loans. The study also recommends that there should be closer consultation and cooperation between commercial banks and the regulatory authorities so that the effect of regulatory measure on commercial banks will be taken into account at the stage of policy formulation. Keywords: Bank Regulation, Nonperforming Loans. Title: INFLUENCE OF BANK REGULATION ON LOAN NON PERFORMANCE AMONG COMMERCIAL BANKS IN KENYA Author: Edah Kavwanyiri, Dr. Shedrack Mbithi Mutua, Mr. Malenya Abraham International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: The main objective of this study was to determine the factors that influence the transfer of training in the parastatals in Kenya. The specific objectives of the study was to determine the effect of trainee characteristics; trainer characteristics; training design and work environment on transfer of training, a case of the Kenya Port Authority. The study adopted a descriptive research design. A descriptive survey aim at a population from a representative sample was adopted. A structured questionnaire was used to collect data relevant for the study. The study targeted 80 respondents in collecting data with regard to determinants of transfer of training from training to the job among the employees of Kenya Ports Authority. From the study 78 respondents out of the 80 respondents filled-in and returned the questionnaires making a response rate of 97.5%. The study sought to find out the extent to which trainee and trainer’s characteristics, training design and work environment affect transfer of training from training to the job. From the findings, self-efficacy, motivation, goal orientation, motivation, job attitudes, goal performance and learning goal affected transfer of training from training to the job to a great extent. In addition trainee personality, goal orientation and trainee ability affected transfer of training from training to the job to a great extent. Moreover, trainee motivation, career management affected transfer of training from training to the job at a great extent. According to the findings, provision of additional or supportive guidance on using the skills back on the job, training content and guidelines for effective training affected transfer of training from training to the job to a great extent. In addition, framing of training/training approach, developments in cognitive research and providing inadequate affected transfer of training from training to the job to a great extent. Moreover, inadequate test designs, sequencing, giving of multiple examples and non-examples of concepts in variety of contexts and learning principles affected transfer of training from training to the job to a great extent. Keywords: Parastatals. Title: DETERMINANTS OF TRANSFER OF TRAINING IN PARASTATALS IN KENYA: A CASE OF KENYA PORTS AUTHORITY Author: Gregory Ndoro Kazungu, Dr. William Kingi, Dr. Mary Ibua International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals

Abstract: The study sought to find out the influence of financial performance on financial sustainability of MFIs. This study was conducted through descriptive survey research design. The specific objective was to find out the determinants of financial sustainability of micro finance institutions in Kenya. The target population of this study was all the microfinance institutions in Kenya. A list of all the 44 Microfinance Institutions obtained from the Association of Microfinance Institution formed the sampling frame. Census technique was used because of their small numbers in the population. Linear regression was also carried out to establish into determinants of financial sustainability of microfinance institutions in Kenya. The study used SPSS version (20) to conduct analysis. The study concluded that financial performance was positively but insignificantly associated with financial sustainability. The study also concluded that there exist a positive relationship between financial performance and financial sustainability. Improving financial performance would improve the financial sustainability as this facilitates asset growth. Increased profits lead to increased concentration which leads to sustainability. Keywords: financial performance, financial sustainability, microfinance institutions. Title: INFLUENCE OF FINANCIAL PERFORMANCE ON FINANCIAL SUSTAINABILITY OF MICROFINANCE INSTITUTIONS IN KENYA Author: Dinah Nabwonya Wafula, Dr. Shedrack Mbithi Mutua, Mr. Maniagi Gerald Musiega International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Research Publish Journals