Effects of Information Communication Technology Adoption on Financial Management in Meru County Government

Abstract

Information Communication Technology (ICT) is used in different areas. The common factor is its acceptance as a technology for facilitating transfer of information by use of electronic mode. Financial management automation is where financial activities are computerization from the preparation of the budget all the way to budget execution using an integrated financial management system. Despite the significance of automating of financial management, the audit report of Meru County government by the auditor general indicated that Meru County Government as having poor ICT policy for key functions such as the budgeting process, revenue collection and procurement processes. There is no report showing that the problem has been addressed to date. Lack of effective financial management practices in the aforementioned functions hinders effective service delivery. The main purpose of the study was to find out if ICT adoption has a significant effect on financial management in the public sector in Kenya purposing on Meru County Government. The study was done the sole aim of achieving a definite objective: to examine the effect of budgeting process automation, revenue collection automation, procurement process automation and cash management automation on financial management. This study used the three theories; diffusion of innovation, systems theory and the technology acceptance model. The study used a census survey of seventy respondents which comprised of fifteen (procurement officers, six budget officers, thirty six accountants, twelve revenue officers and one chief officer in charge of finance. The study used Questionnaire as a research instrument for data collection. For the determination of validity of instruments, content validity index was used. The cronbach’s alpha was computed in order to assist in measuring the reliability of instruments used to collect data and also to measure the internal consistency. The finding of the study shows that all the four predictors are relevant in financial management in the Meru County Government. The study established that budgeting process automation affected financial management in Meru County to a great extent. The study found out that revenue collection automation affected financial management in Meru County to a great extent. The study found that procurement process automation affected financial management in Meru County. The study also found out that cash management automation affected financial management in Meru County to a great extent. On The study recommends that for Meru County to overcome the challenges of budgeting process automation the county should fully embrace the use of ICT and train the users to enhance their skills. On revenue collection automation the study recommends integrated form to enhance efficiency timely revenue collection, enhance management integrity and provide clear records among other factors. On Procurement process automation a fully automated process to be implemented to that will make sure transparency is achieved and proper record keeping. On cash management automation the accountants and other relevant