ABSTRACT : The study’s key objective was to determine the influence of control activities on credit risk of deposit- taking SACCOs in Western Kenya. The study was guided by agency theory, contingency theory and modern portfoliotheory. The target population consisted of 212 respondents from the seven registered deposit taking SACCOs. A descriptive research design was adopted in this study. Simple random sampling was used to determine the sample size. Both primary and secondary data were used. Primary data was collected using questionnaires while secondary data was obtained from audited financial statements of the SACCOs. Data was analyzed using Statistical Package for Social Sciences (SPSS). Statistics were generated using both descriptive and inferential methods. Descriptive data included; frequencies and percentages. Diagnostic tests comprised of; normality, autocorrelation, multicollinearity and heteroscedasticity. Inferential statistics consisted of correlation analysis, multiple regression analysis and ANOVA. Control activities had a significant negative relationship with credit risk. It was recommended that SACCOs review their policies and procedures regularly to meet the current market trends and that human resource management department should work towards ensuring that segregation of duties is done.

KEYWORDS –Control Activities, Credit Risk, Saccos, Internal Control Systems