- However, as of June 2020, the loan taken from the government had its interest at Sh4,060,380,428.
- The college CEO Charles Musyoki said the institution has been following up for the debt to be written off.
Lawmakers have queried Sh140 million loan taken by Utalii College, whose interest had accrued to Sh368 million as of 2020/2021.
The loan was taken to refurbish the Utalii hotel and the interest rates have been piling since 1996.
However, as of June 2020, the loan taken from the government had its interest at Sh4,060,380,428.
The college CEO Charles Musyoki said the institution has been following up for the debt to be written off.
“We had requested for the principal amount to be converted into a grant by writing to the exchequer through the ministry of tourism to improve the college working capital,” Musyoki said.
The college boss appeared before the Public Investments Committee on Education and Governance on Wednesday.
“In 2020 there was an outstanding loan of Sh122,125,028 totalling Sh4,182,405,456 being liability from interest and penalties on the initial loan,” the report said.
The auditor explained that the Sh381 million was not budgeted, hence creating variance for the said financial year.
Further, the committee questioned the college for failing to recover salaries paid to staff in advance.
“The college paid salary advance to members of staff as per the policy, so far the college has recovered Sh287, 500 and the balance is Sh105, 570,” the report reads.
The auditor further queried the Sh10 million given to staff as house and car loans as the principal amount.
Two staff members had not made any repayments for more than a year.
The team faulted the college for failing to avail audit of log books, and title deeds used as security to acquire the loans.
“The loan balance of Sh995, 347 relates to a car loan balance of Sh920,735.71 and a house loan balance of Sh74,611.29. The management is reviewing the file to determine the correct balance,” Musyoki said.
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its doors in 1975 and was established under the Hotels and Restaurants Act, (Cap. 494, Laws of Kenya) which has since been replaced by the Tourism Act, of 2011.
KUC is among the three African International Association of Hotel Schools members.