Water company officials on the spot over auditor’s findings

By RENSON MNYAMWEZI

Three senior managers of Taita Taveta Water and Sewerage Company Limited (Tavevo) were yesterday grilled for hours by the County Assembly Investment and Public Accounts Committee (PAC) over  financial irregularities.

The managers, including Managing Director Peter Shwashwa, were summoned to shed light on an audit report prepared by Auditor General Edward Ouko that detected massive loss of unaccounted water in the firm.

Others also grilled at the County Assembly chambers in Wundanyi town were the company’s Finance Manager Duncan Maghanga and Commercial Manager Justus Singi

The 2012 financial statement obtained by The Standard shows that customer deposits balance of over Sh2.4 million as at June 30, 2012 were not supported with necessary documentation.

The report read in part: “Further, no separate bank account was maintained for these deposits as stipulated in the service provision agreement. In the circumstances, the completeness and accuracy of the customer deposits balance of over Sh2.4 as at June 30 could not be confirmed”.

AUDIT QUERIES

The PAC chairman, Kaloleni Ward Representative Ahmed Omar and other members, took the officers to task asking them to explain the irregularities detected by the Auditor General.

The financial report said during the year under review, the company produced over 2.9 million cubic metres of water and out of this volume only about 1.4 million cubic metres of water were billed to customers leaving a balance of about 1.5 million cubic metres of water unaccounted for.

The balance of 1.5 million cubic metres or approximately 53 per cent of the total volume represented unaccounted water which is 28 per cent over and above the allowable loss of 25 per cent according to the Water Service Regulatory Board guidelines.

“The unaccounted water may have resulted in loss of sales estimated at Sh112.4 million. The significant level of this water may negatively impact on the Tavevo’s profitability and its long term sustainability,” read the report.

Yesterday, the Omar led committee asked Shwashwa and his team to explain why they had failed to comply with the service provision agreement requiring the company to maintain separate accounts of customer deposits.

“We want to know from your office what occasioned such a big loss of water nearly twice the allowable loss. Why did your office fail to avail documents for audit and balance. The audit report will have serious ramification if you do not answer the questions adequately,” Omar warned the officials.

BLAME FREE

Shwashwa said Tavevo is an agent of Coast Water Service Board (CWSB) and blamed its woes on the water reforms.

“Tavevo was formed in 2007 by the defunct Taita Taveta County, Voi Municipal and Taveta Town Councils and it is an agent of CWSB which owns all the property, plant and equipment. We do not own anything and there are rules of engagement,” he said, shrugging off claims that the organisation is riddled with corruption.

“Out of 29 water metres only eight are functional and the commodity is not measurable but estimated. We pay nine per cent of the total revenue collected per month to CWSB,” added Singi.

The officials attempted to exonerate themselves by saying that  the necessary documentation re available at CWSB offices in Mombasa.