IJSRP, Volume 5, Issue 12, December 2015 Edition [ISSN 2250-3153]
Samson Manjuru Mburu
This study determines the impact of capital structure on the financial performance of non financial firms quoted at the Nairobi securities exchange (NSE) in Kenya for the period of 2009-2013. The study adopts an explanatory descriptive research design. A sample of 40 non financial firms listed at the NSE is drawn under judgmental sampling method. Secondary data is obtained from NSE hand book. Multiple regression method is used to analyze and test the hypothesis at 5% and 1% level of significance with the aid of statistical package for social sciences. The findings show that capital structure variables; current liabilities to total assets ratio, long term liabilities to total assets ratio and total liabilities to total assets ratio have a negative and significant effect on financial performance measured by return on assets for financial firms quoted on the NSE in Kenya. The study concludes that capital structure is an important determinant of firm’s financial performance as shown by prior studies.