The Auditor-General has queried expenditure of Sh33.6 billion in six counties she ranked as worst performing on management of public finances, shedding light on the mess that could have seen billions of shillings go down the drain, and putting their governors in the spotlight.
The six Nairobi, Baringo, Narok, Kiambu, Nyamira and Tana River showed significant issues including failure to prove how they spent billions of shillings in the fiscal year ended June 2023.
There were also variances in different sets of their spending records, payments for services that were never rendered and splurging on salaries while ignoring development.
In her report on county executives for the financial year 2022/23, Auditor-General Nancy Gathungu gave the six counties an Adverse Opinion, the second worst score in the management of public funds.
The financial statements exhibit significant misstatement with the underlying accounting records. There are significant disagreements between the financial statements and the underlying books of accounts and/or standards, states the report. While the amounts queried do not necessarily mean that the public funds were lost, they point to a high possibility of loss, corruption and breach of law.
NairobiNairobi City county reported spending Sh100 million to buy vehicles and other transport equipment in its financial statements for the year ended June 2023.
However, upon reviewing the countys documents, Ms Gathungu noted that the county paid over Sh770 million to various motor vehicle dealers during the year.
However, the amount differs from amounts paid to various motor vehicle dealers during the year of Sh771,589,099. The resulting variance of Sh671,589,099 was not explained. Further, the procurement documents and supporting payment vouchers together with the log books for motor vehicles were not provided for audit review, Ms Gathungu queried.
She said Johnson Sakajas government used a revenue management system Nairobi Pay without a contract with the operator.
This is despite the importance of the system, which handles all the countys cash streams and holds all data on crucial matters such as land details, customer records, unpaid debts and all matters revenue.
However, no records were provided for review to show how the Management engaged the vendor and the terms of service delivery which exposed the county executive to possible information confidentiality breach, integrity and availability of the system for service delivery, the Auditor-General noted.
In particular, the county did not have a valid contract with the vendor nor did they have any service level agreement (SLA) defining the terms of support of the revenue system.
She queried tens of transactions the county made in the review period that left at least Sh21.2 billion spent in question.
Other queries include the existence of more vehicles (649) than drivers (325), failure to deduct taxes from 393 employees, awarding bursaries to private school pupils and a Sh13 billion variance on pending bills settled during the year, based on different sets of records.
The report notes that the countys Integrated Personnel and Payment Data (IPPD) on salaries paid to the county staff for the year differs from total payments traced to the salaries bank statements by Sh1.39 billion.
Further, the amount of compensation of employees expense for the year totalling Sh11,185,475,652 differs with the total payments traced to the salaries bank statement amount of Sh9,793,541,055 resulting in an unreconciled variance of Sh1,391,934,597, the report notes.
While all six counties were given an adverse opinion, in terms of amounts queried, Nairobi accounts for close to two-thirds (63 percent).
NarokIn Narok county, which has the second highest queried amounts of Sh4 billion, among key issues was Sh1.1 billion the county reported as amounts it owes suppliers, but could not provide documents to support the bills, including local purchase/service orders, ageing analysis, delivery notes, inspection and acceptance certificates.
The Auditor-General also queried the use of Sh813.8 million on the purchase of different goods and services, including legal fees and travel that could not be supported to prove that such expenses were incurred.
The expenditure includes legal fees, insurance expenses and domestic travel and subsistence allowance of Sh520,227,462, Sh30,510,000 and Sh193,804,166 all totalling Sh744,541,628, Ms Gathungu noted.
However, supporting documents including legal fee notes, insurance policy documents, invoices and work tickets were not provi
