Risk Assessment and Financial Accountability: Lessons from the Kenyan National Public Secondary Schools

Abstract

The overall objective of the study was to ascertain the effect of risk assessment on financial accountability in national public secondary schools in Kenya. The Kenyan education system is burdened with financial management risks that compromise the quality of education Risks are assessed in order to determine the likelihood of an event occurring, the impact, and risk tolerance level. If the risks are identified and classified then tolerance level can then be determined. The study was carried out in103 national public secondary schools in Kenya. The study was guided by; Agency theory, Fraud triangle theory and accountability theory. Survey research design was used. The target population consisted of; 103 principals, 103 bursars, 103 BOM chairs. Purposive and simple random sampling were used to select principals, bursars and BOM chair. Primary data was collected by use of questionnaires, while secondary data was collected through audited financial statements. Reliability of the research instruments was tested through Cronbach's Alpha. Factor analysis was used to assess construct validity. Simple linear regression was used to establish the relationship between risk assessment and financial accountability. The results for the regression model show an R-square of 0.221. The Analysis of Variance (ANOVA) had an F-statistic of 9.920 which has a p-value of 0.000. The p-value of the F-statistic is less than 0.05 showing that the model on the influence of Risk Assessment on financial accountability is generally significant. The regression coefficient estimate of Risk Assessment was (β =0.453, Z=3.150, p-value = 0.000). The study will support BOM and principals of national public secondary to devise effective risk assessment and mitigation programs for improved financial accountability.