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Cash Flow from Operating Activities and Financial Performance of Investment Firms Listed at Nairobi Securities Exchange in Kenya

Author

Listed:
  • ABDI, A.O.

    (Student - MBA (Accounting Option) – Jomo Kenyatta University of Agriculture and Technology)

  • Kimani E.M.

    (Senior Lecturer - Jomo Kenyatta University of Agriculture and Technology)

  • Matanda J.W.

    (Senior Lecturer - Jomo Kenyatta University of Agriculture and Technology)

Abstract

Financial Performance of Investment Firms Has a Significant Impact on Future Prospects of the Firm. Listed Companies Place a Lot of Emphasis on Profitability and Stability of Their Performance. However, Investment Firms Have Been Experiencing a Problem of Poor Financial Performance Over Time. The Study Seeked to Establish Effect of Cash Flow From Operation Activities on Financial Performance of Investment Firms Listed at Nairobi Securities Exchange in Kenya. The Study Was Anchored on Resource-Based View Theory. Descriptive Research Design Was Used in This Study. All the Investment Firms Listed at NSE Were Subject of Investigation Hence a Census Study Was Conducted. Secondary Data Was Sourced From Cash Flow Statements and Other Relevant Financial Statements Using Secondary Data Collection Sheet. The Data Was Analyzed Using Descriptive and Inferential Statistical Methods With the Aid of SPSS, (Version 29.0) Statistical Software. Descriptive Statistical Tools Including Mean, Frequency, Standard Deviation, Skewness and Kurtosis Were Used. Inferential Statistics Included Use of Product Moment Correlation to Depict Strength and Direction of Relationship Between Variables. Panel Regression Model Was Applied for Data Analysis and Langrage Multiplier Test Was Done to Determine Whether Fixed Effect Model Was Suitable for Analysis. The Finding of the Study Indicated a Positive and Significant Correlation Between Operating Cash Flows and Financial Performance of Investment Firms Listed at NSE in Kenya. Coefficient of Determination (R-Squared (R2) Value Was 0.6451 for CFOA. The P-Value for the Variable Was Less Than 0.05 Level of Significance. This Implied That Operating Cash Flow Explained Financial Performance of Listed Investment Firms in Kenya. The Finding of This Study Will Be of Benefit to a Number of Interested Parties Including Creditors, Investors, the Government, Scholars and Researchers, Regulatory Authorities and Trading Companies. From the Findings of the It Was Recommended That Directors of Investment Firms Should Implement a Policy Focusing on Quick Moving Inventory, Which Will Eventually Affect Other Components of Operations.

Suggested Citation

  • ABDI, A.O. & Kimani E.M. & Matanda J.W., 2026. "Cash Flow from Operating Activities and Financial Performance of Investment Firms Listed at Nairobi Securities Exchange in Kenya," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 10(2), pages 4140-4153, February.
    • Handle: RePEc:bcp:journl:v:10:y:2026:i:2:p:4140-4153
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    References listed on IDEAS

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    1. Jacob A. Bikker & Dirk W.G.A. Broeders & Dirk Jan de Dreu, 2010. "Stock Market Performance and Pension Fund Investment Policy: Rebalancing, Free Float, or Market Timing?," International Journal of Central Banking, International Journal of Central Banking, vol. 6(2), pages 53-79, June.
    2. Tobias Adrian & Joshua Rosenberg, 2008. "Stock Returns and Volatility: Pricing the Short‐Run and Long‐Run Components of Market Risk," Journal of Finance, American Finance Association, vol. 63(6), pages 2997-3030, December.
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