Ministries and State agencies failed to account for Sh16.6 billion in the year to June 2018, raising doubt on the authenticity of their reported spending.
The Auditor-General says the 23 ministries and State agencies could not provide payment vouchers, records on receipt of delivered goods and purchase of products outside the budget to support the expenditure during the financial year 2017/18.
“The failure by Ministries, Departments and Agencies (MDAs) to fully support payments cast doubt on the authenticity of the expenditure reported as incurred,” the latest report of the Auditor-General tabled in Parliament states.
The State departments of ICT, Special Programmes, Infrastructure and Broadcasting top the list of 23 that could not account for the Sh16.6 billion in the year under review. ICT failed to support payments worth about Sh3.6 billion, Special Programmes Sh3.4 billion, Infrastructure Sh2.5 billion and Broadcasting and Telecommunications Sh1.1 billion.
Others that had accounting issues were the National Land Commission (NLC) and Independent Electoral and Boundaries Commission (IEBC).
The audit shows Special Programmes did not make proper records available to the Auditor-General to support expenditure on relief commodities amounting to Sh3.4 billion.
The department further failed to account for revenue under the National Drought Management Authority and payments for maintenance of vehicles.
On the State department of Infrastructure’s expenditure, the Auditor-General says supporting documents were not provided for receivable balance of Sh1.1 billion, district suspense account of Sh110.9 million, clearance account of Sh1.1 billion and accounts payables amounting to Sh214.6 million.
The Broadcasting and Telecommunications department did not provide payment vouchers for use of goods and services worth Sh1.1 billion for audit.
The Auditor-General also raised the red flag over Sh142 billion balances that were not analysed or supported.
Kenya has a history of reports of multi-billion shilling scandals unearthed by the Auditor-General not resulting in high-profile prosecutions or convictions. This has angered the public, who accuse top officials of acting with impunity and encouraging graft by their juniors.
Businesses also often cite pervasive corruption as one of the biggest obstacles to investment.
Past audits have suggested collusion by civil servants and private entities to steal billions of shillings from the public coffers.
Former Auditor-General Edward Ouko said that overhauling a procurement and payment system that is easily tampered with is central to halting the looting.
Mr Ouko served between 2011 and August 2018 and was replaced by Nancy Gathungu after the expiry of his eight-year term.
The report shows that out of 65 financial statements for entities with budgetary provisions, 19 received clean opinion while 29 to a large extent were in agreement with the underlying records, except for cases where material misstatements or omissions were noted leading to a qualified opinion.
Financial statements for nine entities exhibited significant misstatements leading to an adverse opinion— which means the statements do no offer the accurate financial health.
Seven entities’ books of accounts exhibited serious and significant misstatements that arose from inadequate information, limitation of scope, inadequacy or lack of proper records such that the Auditor-General was not able to form an opinion hence a disclaimer.
A disclaimer opinion means that auditor has no views on the financial statements because the agencies restricted the scope of the examination.
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