A report by Auditor General Edward Ouko has questioned expenditures and other financial operations of the Uasin Gishu county amounting to more than Sh1 billion in 2014-15.
Ouko questioned direct spending of county revenue collected locally, which violates the Public Finance Management Act of 2012.
The county collected more than Sh800 million, out of which Sh133.7 million was not banked but was spent directly.
“The expenditure was thus incurred without authority from the Controller of Budget and as a result the county executive was in breach of the law,” the report says.
The county also incurred unreconciled deficits in its statements of receipts and payments amounting to Sh546.9 million. Expenditure returns from the county indicated it received Sh5.3 billion, but incurred expenditure of Sh5.9 billion during the period.
“The resultant variance between the two figures has not been reconciled or explained. Further, the source of funding for the Sh546.9 million reflected in the statements of receipts and payments has not been explained,” Ouko said.
The validity and accuracy of the Sh546.9 million figure could not be ascertained, he added.
Cash unaccounted for
The auditor general said the county may have lost about Sh2.9 million collected as land rates.
The report reveals that a review of the bank pay-in slips of rates paid by land owners was receipted and recorded in the cash books, but were not reflected in the County Revenue Account bank statements.
The county reported the matter to the bank management to confirm the authenticity of the bank deposit slips and to the police investigations department.
“The matter had not been resolved at the time of completion of the audit and there may be loss of county revenue through fraudulent pay-in slips that could not be traced to the bank accounts,” the report says.
where’s Sh106 million?
Ouko has also questioned details about proceeds from domestic borrowing by the county government. The county signed an asset financing loan agreement of Sh484.4 million with the Kenya Commercial Bank, but only Sh378.9 million was advanced. That means more than Sh106 million was not received by the county.
“No explanation was provided for not receiving the full amount for which negotiation fees had been paid,” the report states.