IFMIS once, resulting in failure. Finally, transaction cost

IFMIS was initiated through various
legislations and reforms aimed at improving the business transactions in
government ministries. Reforms aimed at enhancing accountability and
transparency. This targeted the core Public Finance Management  systems of budget formulation and execution,
public procurement, revenue collection, internal and external audit, parliamentary
oversight, Payroll and Pensions, Public debt and guarantees, Accounting and
Reporting and the Macro-fiscal framework (Loudon &Traver, 2007).This was to
ensure that the government managed public resources in the most efficient,
effective and transparent manner (Muigai, 2012).The county governments of Kenya have been required by the Public
Financial Management (PFM) Act, 2012 to implement IFMIS since 2013 when they
became operational, but the implementation process has so far been ineffective.
This study posits examining the influence of IFMIS on performance levels
in the ministry of foreign affairs in Kenya

1.1.3 Performance
Outcomes of IFMIS in Government Ministries

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Li et al. (1999) found that knowledge of the
internet channel, convenience, experience, perceived accessibility and utility
are key influences on online consumer behavior. Of these, convenience has
increasingly been linked to online consumer choices. A survey carried out in
2005 established that convenience was the main reason as to why US consumers
selected the internet channel for news services (Pew, 2005). Time savings
appears an important aspect of the convenience of online services (Bellman et
al., 1999; Dellaert and Kahn, 1999).

Consumer concerns about internet security,
privacy and trust have also been noted by many experts (e.g. Miyazaki and
Fernandez, 2001; Geffen et al., 2003; Nissenbaum, 2004). Some IFMIS have overreached and
tried to drive radical PFM changes or implement too much at once, resulting in
failure.  Finally, transaction cost economics theory
suggests people will choose the cheaper method to transact when choosing
between electronic or traditional services (Huang, 2002) Therefore it is
imperative understand users. It is against this backdrop that the study seeks
to establish the influence of IFMIS on performance levels of the ministry of
foreign affairs in Kenya 

1.1.4 Ministries
using IFMIS

The National Treasury launched IFMIS
Re-engineering program in 2011  whose
sole purpose was to spearhead IFMIS implementation. By 2012, IFMIS was
operational in Ministries, Departments and Agencies (MDAs). All the 18
Government Ministries started using IFMIS in financial and business
transactions. The Ministry of Foreign Affairs of the Republic of Kenya is among
the ministries that started using IFMIS.The Ministry was established in 1963
after Kenya’s independence.

1.2 Statement of
the Problem

IFMIS offers efficient and effective financial
information that financial and other managers can use to administer programs
effectively, formulate budgets, and manage resources .Despite the mandatory
requirement for the ministries to fully implement IFMIS, the Controller of
Budget’s quarterly reports on the ministries budget implementation review have
consistently highlighted the failure of these ministries to fully implement
IFMIS in their operations. (Rodin-Brown, 2008).

Budget planning has
not been completely fused with IFMIS in the initial implementation phase.
Therefore the re-engineering aimed to provide a real-time linkage between the
budget planning application and IFMIS .The report notes that operations of ministries have largely remained
manual contrary to section 12 (I) (e) of the PFM Act, 2012. More so the failure
to adopt IFMIS limits transparency in financial management and standard
financial reporting as contemplated by article 226 of the constitution of

It is estimated that the central
government procurement comprises 10% of gross domestic product (GDP). Even a
10% saving via improved procurement performance means Kshs. 30 billion annual
savings for other needy sectors. Consequences of inefficiencies include drains
on scarce resources and erosion of public confidence in Government.

IFMIS can improve public financial
management in a number of ways, but generally seeks to enhance confidence and
credibility of the budget through greater comprehensiveness and transparency of
information. The purpose of using an IFMIS is to improve budget planning and
execution by providing timely and accurate data for budget management and


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