Factors Influencing Performamnce Of Audit Committees In State Corporations: A Case Of The Kenya Urban Roads Authority

Abstract

The purpose of this study was to evaluate factors that influence performance of audit committees in state corporations and the impact of these factors in terms of ensuring good corporate governance practices and accountability. The study was a case analysis of KURA in selected operation areas in county headquarters. The study was guided by the following research questions; (i) To determine the effect of training of the Audit Committee members on the improvement of corporate governance in KURA. (ii) To assess whether the composition of the Audit Committee members affects good corporate governance in KURA (iii) To determine the effect of regular meetings of the Audit Committee members on good corporate governance in KURA. The methodology use was a descriptive study focusing on process of implementation and the results thereof. The case was used in order to increase the likelihood of high quality data but not necessarily as an object of interest in its own right. The data and information was collected using questionnaires. Data was analyzed through descriptive statistics using Statistical Package for Social Scientists (SPSS) in order to give quantifiable statistics and results done with the help of Microsoft Office Excel programme and presented in pie charts, bar graphs and tables. The findings of the study revealed that training of the audit committee members is important so as to equip the members with the necessary skills that they would need in the course of their assignment. This proves to be fundamental as not all audit committee members may have a background in the functions of being an audit committee member, and given that tasks required of them and the knowledge that is expected of them may differ across them, an induction and continuous information and knowledge update would be beneficial both to the audit committee members and to the organization. The respondents indicated that the audit committee members training is important for among other factors to bring members up to date and ensure that they are current on developments in corporate governance procedures and practices supported by 61.5% of the respondents strongly agreeing and 28.2% agreeing with these sentiments. For an effective audit committee, the composition of the committee and the regularity of committee meetings are key in the ensuring that there is an effective and probably efficient audit committee to monitor, check and evaluate the financial functions and practices of an organization The study recommends that audit committee members should undertake trainings to equip them with the necessary skills and knowledge to perform their duties effectively. The composition of the audit committee members is significant in monitoring and evaluation of the organizations performance and should be properly constituted. The regularity of the audit committee‟s meetings is important to ensure that the committee functions effectively in enhancing good corporate governance practices to be attained in the organization. Thus, the committee ought to meet regularly to be instrumental in keeping a check on the performance and the accountability of an organization.