The 2022/2023 audit has flagged multi-billion-shilling expenditures by eight counties in the Rift Valley region.
The counties on the spot over unlawful expenditure amounting to over Sh5.4 billion are Baringo, Bomet, Samburu, Kericho, Laikipia, Kajiado, Narok and Nakuru.
The report identifies inaccuracies in financial statements, lack of requisite supporting documents, revision of financial statements, and reluctance by county staff to cooperate with auditors as some of the challenges faced by the auditors.
The report by Auditor General Nancy Gathungu, dated March 15, 2024, covers all 47 county governments for the financial year 2022-2023.
In her opening comments, Gathungu laments that an effective mechanism for the implementation of audit recommendations was lacking, something she had raised before.
“Failure to apply the requisite sanctions and consequences has resulted in some accounting officers not adequately accounting for the management and use of the public resources with impunity,” Ms Gathungu stated.
The report adds: “Lack of action and sanctions has also led to fiscal indiscipline including misallocation, wastage of resources, and lack of value for money in the implementation of projects and loss of public funds, thereby impacting negatively on development programmes.”
In Samburu County, the Auditor General questioned the use of Sh150 million for construction of market structures, purchase of computers, payment for construction of water pans, purchase of solar panels, tyres, laptops, and printers, and subsistence allowances.
The county executive has also been indicted of irregularly paying Sh36 million to casuals in the health department.
The audit also revealed that some 249 employees had been paid Sh10 million as special allowances in addition to house allowance, contrary to guidelines issued by the Salaries and Remuneration Commission.
The county government had also spent Sh197 million on emergency and refugee assistance despite having not established an emergency fund or disaster management committee as required by the law.
In Baringo County, the Auditor General stated that Sh25 million was paid in the form of salaries to employees outside the Integrated Personnel Payroll Data (IPPD) while another sum of Sh4.8 million was paid to two employees as injury benefits without being supported by court award.
The auditor further states that the county government’s Department of Transport and Infrastructure and that of Water and Irrigation irregularly spent Sh151.9 million for the purchase of bulk fuel for machinery used in road construction and water projects.
“The expenditure was not supported by the list of specific roads or projects and kilometers worked on, list of vehicles or equipment used, work tickets, equipment daily utilization schedules showing date and hours worked, detailed orders, fuel register, and supplier statement,” the report states.
In Laikipia County, the auditor general queries the executive for using Sh3.5 billion out of the total county revenue of sh5.8 billion for payment of salaries for staff. The amount used to pay salaries amounts to 60 per cent of the total receipts while the law sets a limit of 35 per cent.
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The audit also revealed that the county government paid Sh513 million as salaries for members of staff including ECDE teachers, casuals, and staff without payroll numbers outside the Integrated Personnel and Payroll Data(IPPD) base.
The county government had also incurred a heavy interest of Sh101 million for failing to remit statutory deductions owed to LAPFUND, LAPTRUST, and NSSF in time.
“The high interest levied and penalties arising from failure to make remittances of statutory payments on time to various statutory bodies is an unsustainable and wasteful use of public resources,” the auditor general states.
In Nakuru County, the audit report revealed that whereas the financial statement indicated that Sh6.9 billion was used for payment of staff salaries, the payroll indicated an amount of Sh5.7 billion resulting in an unexplained variance of Sh1.1 billion.
The report further reveals that out of the total Sh232 million used for domestic travel and subsistence expenditure, Sh29 million had not been accounted for.
Another sum of Sh15 million in respect of travel and subsistence expenditure incurred on Members of the County Assembly of Nakuru was not explained despite the assembly having an independent vote.
The report also queries the use of Sh11 million as training expenses, without being supported by training needs assessments to identify skills gaps to be filled.
Whereas the county had an approved budget of Sh21.2 billion it had a total revenue of Sh16.2 billion resulting in an underfunding of Sh4.9 billion representing 23 per cent of the approved budget.
Similarly, the county executive spent Sh15.9 billion against an approved budget of Sh21.2 billion, resulting in an under-expenditure of Sh5.2 billion, or 25 per cent of the budget.
In Narok County, the audit report flagged Sh59 million that was paid to various contractors for the construction of footbridges and culverts and other works that were not supported with payment vouchers, contracts, certificates of completion and inspection and acceptance certificates.
The county executive claimed to have purchased three motor vehicles, the delivery notes, pre-inspection reports, and evidence that the vehicles were received and taken on charge were not provided for audit.
The county government had an approved budget of Sh14.9 billion against total cash receipts of Sh11.7 billion resulting in an under-funding of Sh3.2 billion or 21 per cent of the budget.
The audit revealed that 45 county employees who had attained the mandatory retirement age of 60 had been irregularly retained and were paid salaries amounting to Sh45 million. In Kajiado County, the county executive spent Sh43 million on casual workers, the details of which were not provided for audit.
The county government also transferred Sh280 million to the Emergency Fund out of which Sh150 million could not be traced in the County Executive’s Ifmis account, an indication that the said transfers were made through the bank outside the Ifmis system.
The report stated that the county government spent Sh4 billion as salaries for its employees out of the total revenue of Sh8 billion, translating to 46.9 per cent.
The audit revealed that the Office of the County Attorney had incurred Sh149 million in legal expenses arising from the engagement of several consultants to render legal services.
The report states that there was no approval by the county executive committee to engage the legal consultants, hence the action was deemed to have been in contravention of the law. In addition, documentation on bidding and evaluation of the legal firms was not provided for the audit.
In Kericho County, the audit revealed the executive did not provide documents to support the expenditure of Sh189 million under the domestic travel and subsistence allowances.
The report adds that the county executive had spent Sh29 million for the payment of 15 contractors for the supply of various goods and services
“However, supporting documents including procurement documents, delivery documents, and inspection and acceptance reports were not provided for audit review”, the report states.
The county government also paid a sum of Sh154 million as an unsupported payment to various firms while a total of Sh13 million was paid to 26 employees as domestic traveling expenses with no documents to support the expenditure.
In Bomet County, the report indicates that the executive spent Sh93.8 million for payment of casual workers without following the legal procedure.