Kisumu county government cannot account for more than Sh5 billion in the 2016-17 financial year, Auditor General Edward Ouko has revealed.
Former governor Jack Ranguma's administration operated 112 bank accounts, many of which were secret.
Ouko said the county executive used public funds irregularly.
Many accounts were in different banks and were not disclosed in the financial statements of the county.
The county had 93 accounts with KCB, 10 with Co-operative Bank, three accounts each at Family and Equity banks and one with Diamond Trust Bank.
The county government did not carry out automatic bank reconciliations in the IFMIS for all the accounts but the reconciliations were done outside the IFMIS system, the audit says.
"The financial statements for Kisumu County do not present fairly the financial position of the county as at 30th June 2017, and of its financial performance and its cash flow for the year ended and do not comply with the Public Finance Management Act 2012," Ouko says.
He says the statement of the county financial assets reflected a balance of Sh1.35 billion but the cash books were not presented for audit.
Ouko says reconciliation statements for 19 accounts were not made available for audit and bank statements for six other accounts were not presented for review.
The county had outstanding uncollected imprest balances of Sh66.8 million while 11 officers each held imprests of more than Sh1 million.
The county claimed to have liabilities of Sh92.9 million relating to deposits and retentions but no documentary evidence was provided.
Ouko says Kisumu county failed to collect more than Sh1.2 billion as local revenue from 23 streams it had created during the 2016-17 financial year. No explanation was given for the failure.
The county executive claimed to have transferred Sh704.3 million without explanation.
There was no proper documentation for Sh150 million said to have been paid to workers as salaries.
The county could not account for Sh263.7 million out of Sh674.1 million claimed to have been paid out for goods and services. Another Sh1 billion listed to have been transferred to other government agencies was not accounted for.
The county could not explain expenditure of Sh469 million paid out for construction and civil works.
The county had questionable pending bills totaling Sh2.5 billion.
