Thesis:

Influence of financial statements analysis on performance of deposit taking savings and credit co-operative society in Kakamega county, Kenya

An essential function of Savings and Credit Cooperative Societies (SACCOS) is to provide financial services to the underprivileged, who are not eligible for services provided by Formal Financial Institutions (FFIs). These SACCOS, however, face a number of difficulties that could affect how well they operate as a whole. The purpose of this study is to look into how financial statement analysis affects SACCO’s performance in Kakamega, Kenya. Examining a company's financial statements such as the income statement, cash flow statement, and balance sheet in order to evaluate its financial performance and make informed investment decisions is known as financial statement analysis. Because Kakamega, Kenya, has a large number of SACCOS and little research has been done in the area, it was chosen as the study location. Kakamega considerable agricultural output and comparatively high rates of poverty make it an ideal place to research how SACCOS help the underprivileged get financial access. The study specifically looked at the following: to evaluate the influence of ratio analysis on the performance of Sacco’s, to explore the relationship between financial statement analysis and other performance measures of SACCOs in Kakamega, to examine the influence the effect of financial reporting practices on financial performance of SACCO’s in Kakamega and to investigate the factors that affect the implementation of effective financial statement analysis practices in SACCOs in Kakamega, Kenya. This study was guided by the following agency and stakeholder theory. significant 1 highly 1 is 1 coefficient 1 1 1 effect 1 positive 1 financial 1 on 1 The inquiry was conducted using a survey research design because it allows for the manipulation of variables and allows the researcher to choose and study distinct groups of people at one time. There were 830 respondents in the study population, of which 400 respondents made up the sample size determined by applying the Krecjie and Morgan methodology. Document analysis, interviews, and questionnaires were used to gather data. In order to examine the collected data, descriptive statistics such as means, frequencies, and percentages was used. A summary of the quantitative data was used to measure how strongly the variables are related. To determine the link between the independent and dependent variables, the researcher performed a multiple linear regression analysis. The results were presented as tables, graphs, and pie charts. The 1 coefficient 1 for 1 Ratio 1 Analysis 1 is 1 0.267. 11 The significant a 1 has 1 Analysis 1 Ratio 1 that 1 suggesting 1 0.001), 1 < 1 (p 1 performance. The coefficient for Financial Statement Analysis relationship is 0.147. Similar to Ratio Analysis, this predictor also has a significant positive effect on financial performance (p < 0.001). The coefficient for Financial Reporting Practices is 0.198, with a standard error of 0.037. Again, this predictor has a significant positive effect on financial performance (p < 0.001). The coefficient for Implementation Factors is 0.361, with a standard error of 0.046. This predictor has the highest coefficient among all predictors, indicating the strongest positive effect on financial performance. It is highly significant (p < 0.001). The study concluded that the majority of SACCOs in Kakamega, Kenya, recognize the significance of ratio analysis in monitoring and enhancing financial performance. With 85.3% of SACCOs employing ratio analysis, and recommended that the Policymakers can develop and enforce policies that promote the standardization of financial reporting practices across SACCOs. This can involve the establishment of guidelines, regulations, and reporting frameworks to ensure consistency and comparability in financial reporting.