- Current liabilities stood at Sh5.63 billion against current assets of Sh1.35 billion resulting into a negative working capital of Sh4.28 billion.
- Material uncertainty exists that may cast significant doubt on the college’s ability to continue operating.
Kenya Utalii College, considered Africa's leading hospitality and tourism training institution is insolvent, a report of Auditor-General Nancy Gathungu for the year ended June 30, 2021, says.
Gathungu said the institution had current liabilities of Sh5.63 billion against current assets of Sh1.35 billion resulting in negative working capital of Sh4.28 billion.
“The college is therefore technically insolvent and may not be able to meet its short-term obligations when they arise,” Gathungu said in her report.
The report said the college’s continued existence as a going concern is mainly dependent on financial support from the government and its creditors.
Established 47 years ago the College has trained over 60,000 graduates from around the world who continue to serve in the local and international hospitality and tourism industry.
The college opened its doors in 1975 and was established under the Hotels and Restaurants Act, (Cap. 494, Laws of Kenya) which has since been replaced by the Tourism Act, 2011.
KUC is among the three African EUHOFA (International Association of Hotel Schools) members.
EUHOFA International is a prestigious association of hotel school directors and deans of hospitality colleges and universities who work continuously to ensure the highest quality of education in their institutes.
In her report, Gathungu said material uncertainty exists that may cast significant doubt on the college’s ability to continue operating.
She added that, during the period under review, the college had an over-expenditure of the budget amounting to Sh317 million.
“The over-expenditure has, however, not been supported by a supplementary budget or authorisation of the College Council,” she stated.
The budgeted expenditure was Sh763,388,732 against an actual expenditure of Sh1,080,490,280.