Relationship Between Budgetary Control and Donor Funding in Selected Non- Governmental Organizations in Kenya

Abstract

The implementation of budgetary control measures in many NGO’s has become a key instrument in demonstrating the ability and willingness of the NGO to look after donor’s money diligently. NGO’s have found themselves staring down at donor pull outs due to mismanagement of budgets. Previous studies about budgetary controls in NGO’s have focused on the effectiveness realized by budgetary controls on NGOs operations and not how budgetary controls relate to donor funding. The objectives of this study included: assessing the different forms of budgetary control; evaluating donor funding trends in selected NGOs in Kenya and determining the relationship between budgetary controls on donor funding in selected NGOs in Nairobi, Kenya. This study adopted a descriptive research design. Purposive sampling was used in selecting respondents. Questionnaires were used to collect data. Data was analysed using Statistical package for Social Sciences (SPSS) and presented using tables and figures. The study established that budgetary controls included planning, communication and coordination as well as cost control. The study established that an NGO that correctly implemented different elements of budgetary control gained more funding from donors as well as easing of donor restrictions and accountabilities. The study concluded that budgetary controls had a directly proportional relationship with donor funding in NGOs. The study recommended that NGOs should implement the proper form of budgetary control as a tool that gives confidence to donors and assist the NGO secure sufficient amount of funding. In addition, the study recommends that NGOs should diversify their donor portfolio in order to secure more funding and offer synergy during accountability of donor funds.