The Influence of Operational Grants on Financial Prudence in Public Secondary Schools: Evidence from Busia County, Kenya

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@article{1707050,
      author = {Oyinda Consolata Auma, Rashid Fwamba, Tecla Kirwa},
      title = {The Influence of Operational Grants on Financial Prudence in Public Secondary Schools: Evidence from Busia County, Kenya},
      journal = {Iconic Research And Engineering Journals},
      year = {2025},
      volume = {8},
      number = {8},
      pages = {9-16},
      issn = {2456-8880},
      url = {https://www.irejournals.com/formatedpaper/1707050.pdf},
      abstract = {This study investigated the influence of operational grants on financial prudence in public secondary schools in Busia County, Kenya. The study was guided by Public Expenditure Theory, Stakeholder Theory, and New Public Management Theory. A descriptive survey design was employed, targeting 276 respondents from 92 public secondary schools, comprising principals, heads of departments, and accounts clerks/accountants. The study achieved an 81% response rate with 223 questionnaires properly filled and returned. The findings revealed a strong positive relationship between operational grants and financial prudence (?=0.248, p=0.001). The regression analysis showed that operational grants explained 62.1% of the variation in financial prudence (R?=0.621). The study found that schools primarily utilize operational grants for administration costs (mean=3.03), ICT and communication expenses (mean=2.57), and utility payments (mean=2.54). However, 35% of schools reported budget discrepancies where actual spending exceeded capitation by over 20%, and 45% showed outstanding utility debts despite receiving operational funds. The null hypothesis that operational grants have no significant effect on financial prudence was rejected (p=0.001 < ?=0.05), confirming that operational grants significantly influence financial prudence in secondary schools. The study recommends strengthening monitoring and evaluation systems for operational grants utilization, implementing comprehensive financial management systems, and establishing mandatory professional development programs for financial management staff. Future research should focus on longitudinal studies examining the long-term impact of operational grants on school performance and sustainability.},
      keywords = {Operational grants, financial prudence, Secondary schools, Public expenditure, financial management, Kenya},
      month = {February},
  }