PROCUREMENT AUDIT DRIVERS AND SUPPLY CHAIN PERFORMANCE OF COMMERCIAL STATE CORPORATIONS IN NAIROBI CITY COUNTY, KENYA

Abstract

The purpose of this study was to examine the effect of procurement audit drivers on the performance of supply chain management at the Kenya Railways Corporation. The specific objectives of the study were to determine how compliance audit of the procurement system affect the performance of performance of commercial State Corporation in Nairobi City County, Kenya, and to establish the effect of risk management audit of the procurement system on the performance of performance of commercial State Corporation in Nairobi City County, Kenya. The study adopted a descriptive design. The target population comprised staff in the procurement and audit departments at Kenya Railways Corporation. The unit of analysis was the Kenya Railways and the unit of objectivity being 46 procurement and audit department staff. The sampling frame for this particular study included the Procurement and Audit units because they have the necessary skills and knowledge in key areas of the study and can therefore provide the relevant information. The study carried out a census of all the 46 staff in staff in the procurement and audit departments. The main tools for data collection in this study was structured questionnaire. The questionnaire was in the form of Likert scale where respondents were required to indicate their views on a scale of 1 to 5. The collected data was checked for completeness, coded and entered into the Statistical Packages for Social Sciences for analysis (SPSS Version 21).  Data was analysed using descriptive statistics (Frequencies, percentages, and mean) and inferential statistics. Findings show that; there is a strong significant relationship between compliance audit and supply chain performance (r=0.625, p=0.000), a strong significant relationship between risk management and supply chain performance (r=0.456, p=0.037). The study recommends that; Transparency should be encouraged at all phases of public procurement process, to enhance accountability, the commercial state corporations should adopt e –procurement and ensure that all procurement transactions are well documented for easier reference, corporations should consider awarding tenders to ISO certified suppliers only, and the corporations should maintain a repository of records of all procurement functions to ensure accountability in supply.