Our Reporter
A report by the Auditor General covering the period between January 2013 and June 2013 reveals serious financial mismanagement, serious abuse of office as well as violation of government procedures relating to procurement and conflict of interest in Tharaka Nithi county.
According to the report, Tharaka Nithi governor Samuel Ragwa is being accused of failing to account for some monies while a number of corrupt deals have been detected.
The report reveals that the Tharaka Nithi Revenue Collection Account and bank statements indicated that between June 5 and 11 2013, Sh10,000,000 was withdrawn from the account without the approval of the Controller of Budget, contrary to Section 207 (3) of the constitution.
A total of Sh1,050,000 was spent by the county government on travel and subsistence allowances to officers while on official duties within or outside the county on diverse dates. However, the payments were not supported by relevant documents.
Further, the officers were paid transport/fuel costs in the range of Sh5,000 and Sh10,000 but without any basis. Under the circumstances, propriety of the expenditure could not be confirmed.
The county government incurred an expenditure of Sh5,729,740 on procurement of assorted building materials for the construction of Kathwana county government offices. The expenditure was not based on bills of quantities or any other documented specifications from the relevant government technical department. It was therefore not clear how the prices and quantities of the building materials were determined. Procurement of building materials should only be done on approved bills of quantities.
The report further reveals that assessment made on how the county government of Tharaka Nithi has put in place structures to govern and manage its information systems revealed the following weaknesses amongst others:
The county had been supplied with 20 personal computers by Treasury to be solely used for IFMIS. However, a comprehensive ICT inventory for all ICT assets does not exist. The inventory seen was only for the new machines, while no inventory for the old ICT equipment was maintained. The county has one data centre (Server Room) at the former municipal
At the council of Chuka offices, the room is not a restricted area and therefore easily accessible to unauthorised persons. The server is exposed to overheating and there is no airconditioning system to control the temperatures. Also, there are no fire extinguishers within reach.
Review of the event activity logs from LAIFOMs revealed that officers were sharing passwords, where a user had logged in two different modules in two different workstations at the same time. The sharing of passwords was confirmed by the officers.
It was also noted that the ICT manager is not the system administrator in LAIFOMS and therefore he was not in control of how access rights were being granted.
It has also been noted that no staff handing over was done between the former councils and county government, contrary to requirements by the county governments transition authority Act, 2012. Further, no staff validation and head count was carried out to confirm credibility of the staff and magnitude of wage bill being taken over from the defunct councils.
Critical job evaluation, skills assessments and head count should be done, if not yet done to facilitate deployment of key staff to relevant departments, and also identify skill gaps for future recruitment.
Between the months of March to June 2013, expenditure totalling Sh18,669,820 was incurred on travelling expenses, allowances and procurement of goods and services. The expenditure was, however, not supported by relevant documents. consequently, it was not possible to confirm that the expenditure was a proper charge to public funds.
The report also reveals that there was no proper handing over of the former Town Council of Chogoria assets and liabilities to the county government as required by the Ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013.
As a result, the county government had no records of assets and liabilities owned by the former town council, as well as other outstanding debts. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former town council to enable the county government have a basis of opening balances to be reflected in its books of account.
It is also worth noting that the former Town Council of Chogoria operated six bank accounts in two different commercial banks. However, as at the time of audit on August 27 2013, all the accounts had not been closed. This was contrary to the county government public finance management Transition Act, 2013 which required that accounts of defunct local authorities be closed on March 5 2013, or upon expiry of three months at the end of May 2013, to finalise reconciliations, considering that the council was dissolved on February 28 2013.
According to the report, there was no cash board of survey carried out in respect of balances as at February 28 and June 30 2013. The cash survey on cash and bank balances as at February 28 2013 would have provided the correct balances for the county government. Cash board of surveys should be conducted in respect to all cash books at the closure of every financial year to ensure accuracy of the balances.
Debtors reported in the statement of assets and liabilities as at February 28 2013 totalled Sh26,363,828. Analysis of the debtors was not provided for ease of identification and confirmation of correctness of the balance.
A schedule of outstanding plot rents totalling Sh1,062,252 provided revealed that the figure had been excluded from the reported debtors balance as at February 28 2013. Consequently, the correct debtors balance as at June 30 2013 could not be confirmed.
Proper debtors’ records should be maintained and updated regularly to reflect correct balances at any given time. A debt collection policy should also be put in place to ensure that debts are collected as and when they fall due.
As at February 28 2013, the council recorded outstanding creditors of Sh3,879,628 but which was not supported by invoices or demand notes from the suppliers. Creditor’s ledger maintained was not updated and it was therefore not possible to confirm accuracy of the balances as at February 28 and June 30 2013.
The statement of assets and liabilities as at February 28 2013 reflected furniture, fittings and equipment of Sh418,481. The assets figure excluded Sh153,346 for a motor vehicle KUL 933. Physical verification of office furniture and equipment revealed that the number of chairs increased from 30 to 49 while that of tables decreased from 22 to 20 compared with figures reflected on the statement of assets and liabilities. It was explained that the additional 19 chairs were received from the ministry of Local Government headquarters-Nairobi, on unspecified date.
In the absence of supporting documentation, correctness of the information and accuracy of assets balance could not be confirmed. A proper system for recording the county’s fixed assets should be put in place and updated regularly to avoid losses in future.
A report on the defunct Municipal Council of Chuka reveals that there was no proper handing over of the former Municipal Council of Chuka’s assets and liabilities to the county government as required by the ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013. As result, the county government has no records of assets and liabilities owned by the former municipal council, as well as other outstanding debts and staff. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former county council to enable the county covernment have a basis of opening balances to be reflected in its books of account.
The report indicates that the former Municipal Council of Chuka operated seven bank accounts. All the accounts were supposed to be closed upon the take over of the council by the county government. As at February 28 2013, the bank accounts had a balance of Sh8,423,187. However, as at the time of audit on August 20 2013, the accounts had not been closed. This was contrary to the county government public finance management transition Act, 2013 which required that accounts of defunct local authorities be closed on March 5 2013 or upon expiry of three months at the end of the month of May 2013 to finalise reconciliations, considering that the council was dissolved on February 28 2013.
At the defunct County Council of Meru South, there was no proper handing over of the former County Council of Meru South assets and liabilities to the county government as required by the ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013. As a result, the county government had no records of assets and liabilities owned by the former county council, as well as other outstanding debts. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former county council to the county covernment to enable the county covernment have a basis of opening balances to be reflected in its books of account.
The vouncil overdrew its GRF bank account maintained at Equity bank by Sh3,505,647 on May 31 2013 as evidenced by the respective bank statements. Although it was explained that the overdraft was for payment of staff salaries, no appropriate authority was sought before the bank account was overdrawn.
A report by the Auditor General covering the period between January 2013 and June 2013 reveals serious financial mismanagement, serious abuse of office as well as violation of government procedures relating to procurement and conflict of interest in Tharaka Nithi county.
According to the report, Tharaka Nithi governor Samuel Ragwa is being accused of failing to account for some monies while a number of corrupt deals have been detected.
The report reveals that the Tharaka Nithi Revenue Collection Account and bank statements indicated that between June 5 and 11 2013, Sh10,000,000 was withdrawn from the account without the approval of the Controller of Budget, contrary to Section 207 (3) of the constitution.
A total of Sh1,050,000 was spent by the county government on travel and subsistence allowances to officers while on official duties within or outside the county on diverse dates. However, the payments were not supported by relevant documents.
Further, the officers were paid transport/fuel costs in the range of Sh5,000 and Sh10,000 but without any basis. Under the circumstances, propriety of the expenditure could not be confirmed.
The county government incurred an expenditure of Sh5,729,740 on procurement of assorted building materials for the construction of Kathwana county government offices. The expenditure was not based on bills of quantities or any other documented specifications from the relevant government technical department. It was therefore not clear how the prices and quantities of the building materials were determined. Procurement of building materials should only be done on approved bills of quantities.
The report further reveals that assessment made on how the county government of Tharaka Nithi has put in place structures to govern and manage its information systems revealed the following weaknesses amongst others:
The county had been supplied with 20 personal computers by Treasury to be solely used for IFMIS. However, a comprehensive ICT inventory for all ICT assets does not exist. The inventory seen was only for the new machines, while no inventory for the old ICT equipment was maintained. The county has one data centre (Server Room) at the former municipal
At the council of Chuka offices, the room is not a restricted area and therefore easily accessible to unauthorised persons. The server is exposed to overheating and there is no airconditioning system to control the temperatures. Also, there are no fire extinguishers within reach.
Review of the event activity logs from LAIFOMs revealed that officers were sharing passwords, where a user had logged in two different modules in two different workstations at the same time. The sharing of passwords was confirmed by the officers.
It was also noted that the ICT manager is not the system administrator in LAIFOMS and therefore he was not in control of how access rights were being granted.
It has also been noted that no staff handing over was done between the former councils and county government, contrary to requirements by the county governments transition authority Act, 2012. Further, no staff validation and head count was carried out to confirm credibility of the staff and magnitude of wage bill being taken over from the defunct councils.
Critical job evaluation, skills assessments and head count should be done, if not yet done to facilitate deployment of key staff to relevant departments, and also identify skill gaps for future recruitment.
Between the months of March to June 2013, expenditure totalling Sh18,669,820 was incurred on travelling expenses, allowances and procurement of goods and services. The expenditure was, however, not supported by relevant documents. consequently, it was not possible to confirm that the expenditure was a proper charge to public funds.
The report also reveals that there was no proper handing over of the former Town Council of Chogoria assets and liabilities to the county government as required by the Ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013.
As a result, the county government had no records of assets and liabilities owned by the former town council, as well as other outstanding debts. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former town council to enable the county government have a basis of opening balances to be reflected in its books of account.
It is also worth noting that the former Town Council of Chogoria operated six bank accounts in two different commercial banks. However, as at the time of audit on August 27 2013, all the accounts had not been closed. This was contrary to the county government public finance management Transition Act, 2013 which required that accounts of defunct local authorities be closed on March 5 2013, or upon expiry of three months at the end of May 2013, to finalise reconciliations, considering that the council was dissolved on February 28 2013.
According to the report, there was no cash board of survey carried out in respect of balances as at February 28 and June 30 2013. The cash survey on cash and bank balances as at February 28 2013 would have provided the correct balances for the county government. Cash board of surveys should be conducted in respect to all cash books at the closure of every financial year to ensure accuracy of the balances.
Debtors reported in the statement of assets and liabilities as at February 28 2013 totalled Sh26,363,828. Analysis of the debtors was not provided for ease of identification and confirmation of correctness of the balance.
A schedule of outstanding plot rents totalling Sh1,062,252 provided revealed that the figure had been excluded from the reported debtors balance as at February 28 2013. Consequently, the correct debtors balance as at June 30 2013 could not be confirmed.
Proper debtors’ records should be maintained and updated regularly to reflect correct balances at any given time. A debt collection policy should also be put in place to ensure that debts are collected as and when they fall due.
As at February 28 2013, the council recorded outstanding creditors of Sh3,879,628 but which was not supported by invoices or demand notes from the suppliers. Creditor’s ledger maintained was not updated and it was therefore not possible to confirm accuracy of the balances as at February 28 and June 30 2013.
The statement of assets and liabilities as at February 28 2013 reflected furniture, fittings and equipment of Sh418,481. The assets figure excluded Sh153,346 for a motor vehicle KUL 933. Physical verification of office furniture and equipment revealed that the number of chairs increased from 30 to 49 while that of tables decreased from 22 to 20 compared with figures reflected on the statement of assets and liabilities. It was explained that the additional 19 chairs were received from the ministry of Local Government headquarters-Nairobi, on unspecified date.
In the absence of supporting documentation, correctness of the information and accuracy of assets balance could not be confirmed. A proper system for recording the county’s fixed assets should be put in place and updated regularly to avoid losses in future.
A report on the defunct Municipal Council of Chuka reveals that there was no proper handing over of the former Municipal Council of Chuka’s assets and liabilities to the county government as required by the ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013. As result, the county government has no records of assets and liabilities owned by the former municipal council, as well as other outstanding debts and staff. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former county council to enable the county covernment have a basis of opening balances to be reflected in its books of account.
The report indicates that the former Municipal Council of Chuka operated seven bank accounts. All the accounts were supposed to be closed upon the take over of the council by the county government. As at February 28 2013, the bank accounts had a balance of Sh8,423,187. However, as at the time of audit on August 20 2013, the accounts had not been closed. This was contrary to the county government public finance management transition Act, 2013 which required that accounts of defunct local authorities be closed on March 5 2013 or upon expiry of three months at the end of the month of May 2013 to finalise reconciliations, considering that the council was dissolved on February 28 2013.
At the defunct County Council of Meru South, there was no proper handing over of the former County Council of Meru South assets and liabilities to the county government as required by the ministry of Local Government Circular No MLG/1333/TY/52 of February 18 2013. As a result, the county government had no records of assets and liabilities owned by the former county council, as well as other outstanding debts. The Transition Authority should arrange for proper handing over of assets, liabilities and staff of the former county council to the county covernment to enable the county covernment have a basis of opening balances to be reflected in its books of account.
The vouncil overdrew its GRF bank account maintained at Equity bank by Sh3,505,647 on May 31 2013 as evidenced by the respective bank statements. Although it was explained that the overdraft was for payment of staff salaries, no appropriate authority was sought before the bank account was overdrawn.
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