FINANCIAL REPORTING EFFICIENCY ON FINANCIAL PERFORMANCE OF SAVING AND CO-OPERATIVE SOCIETY IN RWANDA: A CASE OF UMWALIMU SACCO

Abstract

The study aimed to examine the impact of financial reporting efficiency on the financial performance of Saving and Credit Cooperative Societies (SACCOs) in Rwanda, with a focus on Umwalimu SACCO. The specific objectives were to analyze the effects of financial management, corporate governance, financial services, and financial information efficiencies.

Materials and Methods

A descriptive study design was utilized. The target population consisted of 128 staff members from Umwalimu SACCO, with a sample of 97 respondents determined using the Yamane formula and selected through stratified and purposive sampling techniques. Data were collected via semi-structured questionnaires, validated, and analyzed using SPSS version 25.0. Descriptive statistics and inferential statistics, including model summary, analysis of variance, and regression coefficients, were generated. Correlation analysis was also conducted to establish the relationships between variables.

Results

The results indicated that financial management efficiency (B = 0.720, p < .001), corporate governance structural efficiency (B = 0.469, p < .001), and financial information efficiency (B = 0.379, p = .0002) had strong significant relationships with the dependent variables, as evidenced by their respective standardized Beta values. This implies that higher levels of these efficiencies were positively correlated with changes in the dependent variables. In contrast, financial services efficiency (B = -0.198, p = .036) was negatively associated with the dependent variables, suggesting that higher levels of financial services efficiency correlated with a decrease in the dependent variable. The constant (B = -1.722, p = .128) did not significantly impact the dependent variable.

Conclusion

The study highlights the critical correlation between financial reporting efficiency and the financial performance of SACCOs in Rwanda, specifically at Umwalimu SACCO. The findings underscore the pivotal role of transparent and effective financial reporting practices in influencing the overall success and sustainability of these organizations.