Financial management of donor funded projects: the case of Lower Kihansi Environmental Project (LKEMP)

The purpose of this study was to determine the effectiveness of financial management system on sub-projects supported by the lower Kihansi Environmental Management Project (LKEMP). It included establishing major challenges faced by the people implementing the sub project. The methodology used was by survey of the three riparian districts of Kilolo Kilombero and Mufindi. A questionnaire was designed where the respondents answered the question from their own perception of the projects. In some cases interviews were conducted. The interviewees included chairmen and secretaries and/or treasures of the relevant sub-projects. Where interviewed. Discussions were also held with Executive Directors of the respective Districts. The sample covered 70 sub-projects in all the three districts, out of these, 56 sub projects responded to the questionnaires and these formed the basis of the research findings and conclusions. Based on the analysis we found out that the financial management function is carried out according to International Financial Reporting Standards (IFRS). It was also found out that the financial Management Reports are of good quality in terms of timeliness, accuracy and reliability. However there are hindrances in some projects due to little financial management knowledge and experience by the implementers. There is need for scholars to do more studies on the ways to improve financial, management function especially in rural based projects