The Intervening Effect of Internal Audit on the Relationship between Governance and Performance of National Government-Constituencies Development Funds in Kenya
Charles Thomas Keya, PhD Canditate; Prof. Josiah Aduda; Dr. Winnie Nyamute; Prof. Ganesh Pokhariyal

Abstract
The objective of the study was to determine the intervening effect of internal audit on the relationship between governance and performance of National Government Constituencies Development Funds (NG-CDFs) in Kenya. The study was anchored on Agency theory. A census survey was carried out on the performance of all the 290 NG-CDFs in Kenya. A positivistic research philosophy and a descriptive cross-sectional survey design were used. Data collected using structured questionnaires was collated, cleaned, sorted, edited, analyzed and interpreted based on descriptive statistics, simple, stepwise and multiple regression analysis. The questionnaire was administered through a drop and pick method to all the 290 NG-CDFs out of which 185 filled and returned the questionnaires which presents a 66.07% response rate. Secondary data was easily accessible from the National Treasury, Kenya National Bureau of Statistics, the Auditor General’s reports and NG-CDF website which was collected for the period 2014 to 2018. The objective had corresponding hypothesis which was stated and tested at 95 percent confidence level. It was established that internal audit as an intervening variable has statistically significant effect on the relationship between governance and performance of NG-CDFs. The study benefits policy makers in the sense that the NG-CDF board should ensure that all NG-CDFs have homogeneous governance practices and adhere to internal audit mechanisms which ensure performance in the NG-CDFs. Managers in NG-CDFs may consider strengthening governance interaction and combine with internal audit variable of the study to enhance performance. The NG-CDFs management may also apply DEA technique to measure the performance. In addition, future studies need to use similar variables in the other funds such as youth fund, women fund among others.

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