Global Journal of Economic and Finance Research

This study explores the connection between effective budgeting practices and financial sustainability in the Kisii County Government in Kenya. This study employed a descriptive design, targeting 129 respondents from the Department of Finance and Economic Planning, with a sample size of 123, as determined by Yamane's model. Data were collected using questionnaires and analyzed using descriptive and inferential statistics. The results indicate a significant positive correlation between budgeting practices and financial sustainability (R2=0.566), with budgeting processes having the strongest impact (β=0.729, p=0.000). Resource allocation methods (β=0.041, p=0.017) and financial management strategies (β=0.209, p=0.015) also contributed to financial sustainability. However, challenges and opportunities in implementing performance-based budgeting have a slightly negative relationship (β=-0.012, p=0.040). The study concludes that effective budgeting practices, efficient resource allocation, and robust financial management strategies are crucial for enhancing the financial sustainability of Kisii County Government. This study recommends implementing a comprehensive performance-based budgeting system, prioritizing stakeholder engagement, investing in financial management systems, and aligning budgeting processes with long-term development goals to improve fiscal stability and sustainable development in the county.

Effective budgeting practices, financial sustainability, County governments, performance-based budgeting, resource allocation, financial management strategies, fiscal decentralization

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