Irregular Procurement and Lack of a Fixed Assets Register in Kakamega County
In the year under focus Kakamega County operated 34 bank accounts with balances amounting to Ksh. 1.7 billion as at 30 June 2016. The problem was that the auditors were not availed any bank statements and bank reconciliation statements to verify the accuracy of that reported figures.
During the year, Kakamega County operated an excess of 184 bank accounts. Operating this large number of bank accounts leads to possibility of losing funds. Kakamega County management did not provide explanations on why they are operating large numbers of accounts.
During FY 2015/2016, Kakamega County government did not maintain a Fixed Assets Register. This is a document which is used to record details (serial numbers, condition, description, purchase prices, location and net book values etc) of various assets.
If there is no Fixed Asset Register, then the auditors were unable to verify the accuracy of the amount of Ksh. 849.1 million provided in the financial statements. This figure does not include the values of fixed assets inherited from the defunct local authorities. Therefore, OAG could not confirm the figures provided in the financial statements.
Just like Mombasa, Kakamega County had abandoned or stalled projects valued at Ksh. 55 million during FY 2015/2016. To make matters worse 90% of the project costs had been paid to the contractors. This means residents of Kakamega County did not receive value for their money.
According to the OAG reports, Kakamega County practiced irregular procurement during the year under review. For instance, the auditors pointed out to Fairmat Kenya Limited which was awarded a tender to construct administration and tuition blocks at St. Henry Saisi Secondary School at a cost of Ksh. 14.3 million (this is a national government function). The county executive did not avail procurement documents for audit. Further, auditors revealed that there was only one tenderer, the award winner who submitted the bid for the said contract.
Renovation of Bukhungu Stadium
The contract to renovate Bukhungu Stadium was awarded to Wilkor Building and Civil Engineering Contractors Limited. The cost of renovation was Ksh. 399.7 million. Phase one (1) of the project was to be completed on 18th July, 2016. The county executive did not avail payment voucher for Ksh. 94.1 million to be reviewed by the auditors.
Based on the above mentioned issues with county spending, the Office of Auditor General gave an adverse opinion to the Kakamega County financial statements for financial year 2015/2016. This means there are systemic problems that need to be addressed by responsible agencies.
