ACCOUNTABILITY PRINCIPLE AND FINANCIAL MANAGEMENT OF NATIONAL GOVERNMENT CONSTITUENCY DEVELOPMENT FUND IN NYANZA REGION, KENYA
Effective institutions and systems of public financial management play a critical role in the implementation of government policies and sound economic management. Adequate decisions that are made in financial management are based on principles of corporate governance which include accountability, flexibility, predictability and transparency. The CDF Act of 2003 established the Constituency Development Fund (CDF) in Kenya, and further amendments in 2007 and 2013 and 2015 reorganized the fund's administration to prioritize projects and engage residents more directly. The changes are intended to make the fund more user-friendly. The genesis of poor financial management of the NG-CDF in Nyanza Region is the inadequate corporate governance. Among the challenges identified that continue to adversely affect the performance of the NG-CDF include failure to comply with the approved budget of the NG-CDF and non-conformity to the required principles of public procurements. The objective of the research is to establish the influence of the principle of accountability on the financial management of NG-CDF in NG-CDF in Nyanza Region, Kenya. The target population of this paper are the counties around the lake region in Kenya. Proportional sampling technique using Taro Yamane’s formula arrived at a sample size of 205. A response rate was 76.6% (157/205) was achieved. The results indicate that accountability has a strong positive Pearson correlation (r=0.757, p=0.000) influence on financial management of NG-CDF in Nyanza Region, Kenya. This indicates that Accountability play a major role in financial management.