•In her latest audit rep, Gathungu says the university liabilities exceed current value of assets, Sh1.8 billion.
•The value of the assets is declining, the auditor said.
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Egerton University has accumulated debts and liabilities exceeding Sh4.6 billion and it faces a worsening financial crisis.
That's what Auditor General Nancy Gathungo said of the university in her report for FY2018-19.
She said the university's liability's exceed the value of its assets, by Sh1.8 billion. The value of the assets is also declining..
“This is indicative of the continued deterioration of the working capital position," she said.
"The management has not disclosed the material uncertainty that casts significant doubt in the ability of the university to continue to sustain services." the auditor said.
The university’s financial statements also reflected a balance of Sh3.4 billion as pending under staff costs. That includes Sh150.5 million relating to gratuities.
“However, the detailed listing indicating the members of staff and amounts owed was not provided for audit.
"In the circumstance, the accuracy and validity of the reported staff costs of Sh3.5 billion could not be confirmed, the report said.
During the same period, student debts amounted to Sh869.9 million, an increase of Sh47.8 million from Sh822.2 million reported in the previous year.
The audit report said that Sh804.9 million or 93 per cent of the balance had been outstanding for more than a year.
“The university management attributed the increase to students sitting for exams and graduating in spite of the fee balances," the report said.
"Evidence of measures put in place to address the issue were not provided in spite of the fact that the issue was reported in the prior year."
Gathungu said the university’s property assets include land valued at Sh1.2 billion. Of that, Sh226.8 million relates to three parcels ownership documents.
On budget control for FY 2018-19, expenditure totalled Sh5.4 billion, against an approved budget of Sh4.7 resulting in unauthorised expenditure of Sh739.9 million, or 15 per cent,
Stalled university projects were valued at more than Sh321 million. The university library contract for Sh2.1 billion, signed on June 20, 2017, was incomplete.
Financial statements reflected a balance of Sh22.9 million under council expenses. A review of records in support of the expense revealed the council held 50 meetings, including 35 scheduled and 15 others against the planned number of 21 according to its calendar.
“No explanation was provided for the excessive meetings," the report said.
(Edited by V. Graham)