Accounting and Finance
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Welcome to the Accounting and Finance Community at the School of Business, Mzumbe University (SoB MUIR)! Our Institutional Repository is a central hub for academic excellence, featuring a wide range of research, theses,dissertations, and contributions from our faculty and students. We focus on the latest in financial management, accounting, and economic trends, encouraging researchers, students, and professionals to explore our work. Our community is dedicated to advancing knowledge, fostering innovation, and highlighting our achievements in accounting and finance. Join us as we contribute to the evolving field of financial education and research.
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Item Determinants of credit access to small and medium enterprises (SMEs) in Tanzania : A case of Mbeya City(Mzumbe University, 2013) Sarikiael, BorishSmall and medium enterprises (smes) are the main players in the economy of Tanzania and other developing countries. Smes contribute prominently to the economy through creating more employment opportunities, generating higher production volumes, increasing exports and introducing innovation and entrepreneurship skills. The dynamic role of smes in developing countries is like an engines through which the growth objectives of developing countries can be achieved. This study used a sample of 105 smes located in various areas of Mbeya city, it is from these smes data were obtained by using questionnaires, interview guides and documentary reviews. By using these methods of data collections, primary and secondary data were obtained to assess determinants of credit access and credit size by smes in Tanzania. Analysis of data was conducted by running ordered logistic model to assess which factors determine credit access and credit size by smes. The study found that credit access and credit size by smes are significantly determined by factors like collateral, sales size, business experience, level of education, and form of business ownership. Cross sectional data methodology was used, in this study, future studies can employ panel data designs that can allow to control for unobservable heterogeneity of individual smes. Moreover further research is needed to examine with non-parametric statistical techniques, such as with neural networks, the relationships of all the variables that this study examined, as well as to run causality tests, in order to investigate which variable or smes characteristic causes the other. For instance, does gender influence ownership of assets whereby ownership in turn influence access to credit?Item Determinants of profitability of domestic and foreign commercial banks in Tanzania: A case of commercial banks listed in DSE(Mzumbe University, 2013) Mrema, Issaya I.This study examines the determinants of commercial bank’s profitability in Tanzania. These determinants have been categorized into internal factors which are bank specific characteristics and external factors which can further be divided into macroeconomic factors and financial structure factors. The main objective of the study is to determine the factors that influence commercial banks profitability in Tanzania and to make recommendations for management decision making and policy objectives. A panel data of commercial banks in Tanzania was analyzed taking into consideration of 4 Banks listed in DSE. Two key measures of profitability (dependent variables) were taken into consideration, but the purpose of making a regression analysis and analyze the relationship between the parameters, the researcher analyzed only ROA in his study. Bank-specific factors, which were incorporated, were capital adequacy, deposits, liquidity, asset quality, loans and advances. In addition, macroeconomic factors and financial structure factors including inflation, GDP, money supply and banking industry concentration. The results for the ROA model indicate that loans and advances to total deposits, customer deposits to total assets (liquidity) are positively significant to bank profitability while shareholders equity to total assets are negatively significant to bank profitability. Moreover, inflation and GDP were positively significant to bank profitability. Also, highly capitalized banks were seen to be more profitable compare to less capitalized one. The study recommended on reduction of expenses, Government policies on employment and investments should be intensified to increase the profitability, Efficient and effective liquidity management should be adopted and there should be a set of direction guideline to manage properly banks specific determinants. The study made a researcher to learn that financial performance performed by banks plays a significant role in assuring and maintaining stability of the countries’ economic systems.Item Determinants of profitability of commercial banks using camel framework: A case of Tanzania(Mzumbe University, 2013) Tiisekwa, FadhilaThe study primarily aims at determinants of profitability of commercial banks in Tanzania applying CAMEL frame work. This study compares the financial performance of three major banks CRDB, NBC and NMB. The three banks are also ranked based on a CAMEL rating system. The study is undertaken in attempt to fill in the existing research gap, also to confirm the role played by internal factors to determine profitability and last but not least to provide information that can be used as a basis for comparison with different studies. This study involves the analysis of commercial banks operating in Tanzania for a period of 7 years, from 2006 to 2012. Financial ratios in the context of CAMEL framework, which include; Capital Adequacy, Asset Quality, Management Quality, Earnings and Liquidity were applied. The research uses the data published by the sample banks in their annual reports and financial statements. Descriptive statistics were applied in analyzing the data, followed by deriving of CAMEL ratios and rating them and then correlation analysis was performed and finally regression was applied. The dissertation is organized into five chapters. Chapter one, problem setting; Chapter two deals with literature review which includes theoretical review, empirical review and conceptual framework. Chapter three is the research methodology; Chapter four is concerned with data analysis, findings and discussion and Chapter five gives the conclusion and recommendations. The CAMEL model predicts 51.74% of ROA; this calls for a more robust way of determining profitability to include external factors. NMB which is 50% foreign owned and 30% government owned proved to out rank the other two major banks CRDB and NBC. The study reveals that the profitability of commercial banks as measured by ROA is significantly determined by quality of assets. In order to improve profitability; credit information should be improved, and banks can opt to diversify their products so that they do not heavily rely on loans.Item Contribution of corporate social responsibility on financial performance: A case of NMB PLC at Morogoro municipality(Mzumbe University, 2014) Ayo, Happy KyungaiCorporate Social Responsibility (CSR) is a rapidly developing, key business issue. It is a concept that has attracted worldwide attention. Due to the demands for enhanced transparency and corporate citizenship, CSR started to embrace social, ethical as well as environmental challenges. Today, companies are aware of the social and environmental impacts of international production. It is accepted that Companies should not be only profitable, but also good corporate citizens. This research work was carried out at NMB PLC with the aim of assessing the impact of corporate social responsibility on organization financial performance a case of NMB PLC at Morogoro Municipality. The methods used in data collection were observation, interview and questionnaire. Collected data were analyzed using Ms Excel and statistical package for social sciences (SPSS).data presentation was based on tables and figures shows frequencies and percentages. From the findings, result of analysis implies that there is no direct relationship between CSR and financial performance, respondents commented that most area which got CSR contribute nothing to the bank performance but just receive CSR as aid and to make community enjoy. On the side of contribution of CSR on NMB PLC performance the analysis reveal that activities of CSR affect return of the Bank by reducing amount of profit instead of reinvest the profit and increase value of asset, on the challenge facing company on engaging in CSR the result implies that shareholders are not willing to offer CSR as wealth not maximized but minimized. Conclusion of the study shows that respondent comment on agent theory that shareholders are not willing to engage in CSR program as wealth are not maximized but minimized also larger number of respondents comment that CSR improve more reputations and company image and not financial performance of the company.Item Determinants of interest rate spread in commercial banks: A case study of selected local and foreign banks in Tanzania(Mzumbe University, 2013) Aikoh, Kenedy J.The behaviour of interest rate spread in Tanzania for a very long period of time have been strong, high and persistently showing little signs of narrowing. When compared with other East African countries, interest rate spread in Tanzania seems to be the highest. It is this persistent and low narrowing trend of the interest rate spread which gave rise to the need of studying the factors which causes high interest rate spread in commercial banks in Tanzania. The overall objective of this study was to identify the Determinant of interest rate spread in commercial banks in Tanzania and comparing the interest rate spread between the selected banks. The determinants were ascertained from review of previous literatures. Related parameters from the selected determinants were studied for the chosen banks for the period between 2006 and 2012, a period after adoption of market determined interest rate regime. The study based on the secondary data from 28 quarters of published quarterly reports of the selected commercial banks and Bank of Tanzania quarterly economic bulletin publications. Multiple regressions were applied to establish relationship between the dependent variable, interest rate spread and the chosen independent variables which were non-interest income, provision for loan losses, non-performing loans, non-interest expenses, gross domestic product rate, treasury bills rate and inflation. The results from the study indicate that the key determinants of interest rate spread for the selected commercial banks are the treasury bills rate; Real GDP rate, Non-interest income, NII; Provision for loan losses, PLL and Non-performing loans, NPL. The results also show that the interest rate spread for the selected local commercial bank is higher than that of the selected foreign commercial bank. The policy implication from the study is that the high responsiveness of commercial banks spread to the treasury bills and real GDP rate needs to be regulated. This study can be extended by exploring the impact of financial sector development on interest rate spreads in commercial banking system.Item Contribution of the investment portfolio management strategies on assets growth: A case study of Local Authority Pension Fund(Mzumbe University, 2015) Kyaruzi, GodfreyThis study intended to examine major investments portfolio that makes contribution towards the assets growth of LAPF. Specific objectives that guided data collection were: To establish investment choice taken by LAPF; to select optimal assets portfolio of the LAPF in the study; and to estimate the optimal portfolio equation for a time series data of 2005 to 2014. In conducting this study, the researcher used a case study design; he collected and used secondary data through interviews and document analysis. The study revealed that, there are a number of strategies and modes the Fund took in the investment portfolio management towards assets growth which include measures like: leadership commitment and engagement of all stakeholders, public awareness, diversification of portfolio, good governance and risk management, allocation of portfolio assets properly, and marketing of portfolio. It is also reported that members‟ contribution increased by an average of 34.12% for ten years, this was attributed by the increment of the Fund‟s members. The study also revealed that, investment portfolio contributes 80.85% of the LAPF assets growth. Finally, it was found out that there were a number of challenges that the Fund faced in investment portfolio management, these included: few listed companies and therefore funds are forced to invest in government securities and real estate (investment property), government interventions, political factors, accountability problems, poor life-cycle cost analysis, problems in budgeting process and budget authority, and inadequate tracking of portfolio performance over its full life cycle. The researcher recommended grouping initiatives using common resources to leverage the knowledge and expertise; portfolio management should treat opportunities, initiatives and projects as investments, and the Fund must incorporate objective criteria to evaluate both existing investments and new investment proposals.Item Corporate governance practices and investment performance: A case study of selected pension schemes in Tanzania(Mzumbe University, 2013) Mkilalu, EmanuelSustainability of pension funds depends on investment performances. The best corporate governance practices is indeed the key issue influencing investment performance of public pension schemes. This study was designed to analyze performances in relation to corporate governance practices. The objective of this study is to determine the effect of corporate governance practices on the performance of the pension scheme. The study focused in three selected pension funds in Tanzania, namely, the Public Service Pension Fund, National Social Security Fund and Parastatal Pension Fund. Theoretical and empirical studies of this work relied on the relationship between corporate governance practices and performance of pension schemes. The study used both primary and secondary data as the means of collecting data with a comparative case study orientation. Published financial statements and other desk materials were collected principally from case public pension schemes. In addition, Interviews were also made with responsible top management and officials from planning and investment departments of the funds. The study found the relationship between the corporate governance best practices and investment performance, Social Security Regulatory Authority controls and monitor the investment in these selected pension scheme but it should not limit the pension schemes to invest outside the country as this is the only way to diversity the local risks. Stakeholders and employees should be actively involved in the conduct of good corporate governance practices as this is the only way successes could be achieved in its effect on the performance of pension scheme in TanzaniaItem The Determinants of non-performing assets in Finca International Incorporation: A Case Study of Morogoro branch(Mzumbe University, 2015) Bernard, Beatrice JohnMicrofinance Institutions (MFIs) in the World currently provide significant financial services including microcredit facilities particularly to the rural and semi-urban areas across the country. Granting of microcredit facility (Loan) is a major activity of the mfis and the loan portfolio constitute a significant proportion of the assets of the MFIs. Undoubtedly, the mfis derive most of their interest incomes from loans, however, not all loans granted to beneficiaries perform well and earn the expected returns and this tend to have adverse effect on the quality of the loan portfolio. The purpose of the study was to find out the Determinants of non-performing assets in Microfinance Institutions. The study focused on trend of Non-Performing Assets at FINCA as a whole and the causes or factors for Non-Performing Assets at FINCA Morogoro Branch. The study reviews both theoretical and empirical aspects of nonperforming Assets. Chi-square analysis is employed, both primary and secondary data were used for the study. The study found FINCA recorded significant amounts as non-performing assets in the five-year period reviewed and has adversely affected the financial performance of the organization by reducing its operating profits, loanable funds and undermining the liquidity position. The findings revealed that external factors are more prevalent in causing non-performing assets in FINCA. Findings suggest that integrity of borrower such that use of funds for purposes different from agreed ones as a major factor that cause n pas. Close monitoring of borrowers is critical to lending business, good relationship with borrowers was found to be the most favorable strategy of reducing non-performing assets. The researcher suggests future studies should be broad to assess the performance of Credit Risk Management in line with the level of NPA in mfis. This thesis is organized into five chapters. Chapter one covers introduction of the study. Chapter two presents review of related literature. In this chapter, the key issues concerning Non-performing Assets are discussed. Chapter three is the research methodology. Chapter four discusses various findings and analysis, while several recommendations and conclusion are found in chapter five.Item Determinants of community banks profitability in Tanzania: A case study of Mufindi Community Bank (MUCOBA)(Mzumbe University, 2013) Sanga, Abbas E.The study aimed at looking on the Determinants of Community Banks profitability in Tanzania a case of Mufindi Community Bank. This was because community banks have a number of problems that affect its profitability such as loan default, increasing operating expenses, interest rates, credit risk management and banks management of loan portfolios. In the light of attaining such aim; the objectives of the study was to assess the determinants of the community bank‟s profitability, to examine the internal factors that determines the performance of community bank profitability, to examine factors determining bank interest, to assess the performance of community banks loan portfolio. To examine the credit risk management procedures by the community bank, and to examine the effect of operating expenses to community bank profitability. Information for Six years (2005-2011) from MUCOBA annual reports obtained from their documents and which is published on their website provided qualitative and quantitative data for analysis. To find relationship the model of William Bentum (2012) was applied in descriptive analysis. The results have been organized and processed in figures and presented in tables. Results from the study reveal that the performance of the MUCOBA has been highly volatile with the banks reporting lowest ROA in year 2007 and 2008. The study also revealed that existing community bank performance or profitability is so depending on efficiency of endogenous variable which is under community bank management control as the key button to touch for successful performance of community banks. This study also indicate volatility of community bank ROA in Tanzania is explained most by variables of interest rate charged by the bank, operating expenses, loan portfolio, credit risk, on which have shown statistically significance in explaining variation of MUCOBA ROA. High interest rates were among the factors, which need attention for the purpose of increasing performance of MUCOBA.Item The impact of ineffectiveness of the internal audit in public sector management: A case of Morogoro Municipal Council(Mzumbe University, 2014) Mbembela, Victor GodfreyThe main objective of the study was to assess the impact of ineffective internal audit in Morogoro municipal. The specific objectives of the study were; to identify the roles of internal audit in the public sector, to identify the challenges of the public sector internal audit and to identify economic implications of the ineffective internal auditing system in the public sector management. The study was conducted in Morogoro municipal, Morogoro district in Morogoro region. The targeted population of the study was the Morogoro municipal workers in the fields of economy including procurement officers, stores, accounting and finance and internal control department. The sample size of the study was 50 respondents. The purposive sampling technique was used to choose the workers for the research sample. The study instruments which were used in the study were questionnaire which was asked municipal workers, interview which was conducted with procurement officers and accounting and finance officers and the observation which was made by the researcher in the study area. The findings indicate that oversight, insight, foresight, governance, control and risk management as roles of the internal audit, although there were other roles. Respondents also mentioned developing methodologies, computerized tools communication and the relationship between internal and external audit were the challenges to the public internal audit sector. Also when the respondents were asked if there were any economic implications due to ineffective internal audit, they mentioned in accomplishment of programs, low productivity, and the collapse of the economy and less risk assessment as the economic implications. The findings discussed by the researcher based on each specific objective, made him to give the following conclusions. The roles of the internal auditors in the public sector should be taking into consideration in each budget of Morogoro municipal so as to reduce the effects that have been caused by ignoring such roles to be played by.