•Entity on spot for paying hundreds of thousands of shillings for meetings attended by one person.
•Authority also exceeded its board expenses by more than half of the budgeted amounts.
Image: EZEKIEL AMING'A
The National Environment Management Authority is broke and may not sustain its operations unless supported by the government and creditors.
The authority, a latest audit has revealed, may not meet its cost of operations in the wake of a negative working capital of Sh212 million.
Auditor General Nancy Gathungu reported that the authority recorded an operating loss of Sh63 million, increasing its budget shortfall to Sh78 million.
She revealed Nema had current liabilities of Sh1.28 billion against current assets totaling Sh1.068 billion.
“This indicates that the authority is technically insolvent,” Gathungu said in her review of the authority’s books of accounts for the year ending June 2019.
“In the circumstance, sustainability of the authority’s operations is dependent upon the financial support of the government and creditors,” the auditor said.
She further decried that the Nema managers have not indicated the measures they have taken or intends to take to reverse the unsatisfactory financial performance.
On top of the cash-flow woes, Nema has also been put on the spot for paying Sh609,542 as sitting allowance for meetings held by one person.
An audit has revealed that the said person was the only one who signed the attendance register through which the payments were based.
Gathungu has flagged the anomaly in her review of Nema’s books of accounts for the year ending June 30, 2019.
“The minutes of the meetings were not provided for audit review and as a result, the validity of the payments could not be confirmed,” Gathungu said, putting Nema management on the spot.
Also flagged are irregular board expenses which doubled in the financial year under review from Sh21.6 million the previous year.
The expenses rose to Sh43.05 million in the financial year ending June 2019, denoting an increase of 98 per cent in one year.
Gathungu said the authority irregularly held extra board meetings, which exceeded the number of meetings they were to be held in the referenced year.
The Board’s work plan indicated that the authority was to hold four meetings of the full board and four in respect of standing committees during the year under review.
But board expenses incurred and attendance registers indicated a total of 84 ordinary and special meetings were held by the board and the standing committees.
Of the flagged meetings, 26 were for the full board, 25 by finance and human resource committee, nine for audit, governance and risk management committee.
Another 10 for environmental management and conservation technical committee., and 14 for strategy legal and resource mobilisation committee.
Nema has also been reprimanded for failing to include nine parcels of land in Kilifi, Lamu, Taita Taveta, Homa Bay, Isiolo, Embu, Kajiado, Elgeyo Marakwet, and Samburu counties.
Gathungu reported that the ownership documents for the parcels of land were not provided for audit review, casting doubt on the reported value for property, plant, and equipment.
“Consequently, the accuracy, completeness and ownership of the property, plant, and equipment balance of Sh333,967,000 as at June 30, 2019, could not be confirmed,” the auditor said.
Also in doubt is whether Nema would recover Sh169 million that it is owed by state agencies and imprest of Sh7 million – some outstanding for more than four years.
“Imprest and advances totaling Sh29.9 million had not been surrendered by the close of the year under review on June 30, 2019,” the auditor pointed out.
“No plausible explanation was provided by the management for the failure to recover the old outstanding balances,” Gathungu said.