Nakuru Governor Susan Kihika was put on the spot by senators on Tuesday, June 27, over irregular expenditure and mismanagement of more than Ksh301.7 million.
Appearing before the Senate Committee on County Public Accounts, Kihika was tasked to explain several unaccounted expenditures, including fund transfers made to the Nakuru Alcoholic Drinks Board.
According to the committee, the Office of the Auditor General revealed that the board received funds for unsupported foreign travel allowances and irregular fund transfers for the fiscal year 2019/2020.
“The most severe revelation in the report was the presence of financial risks including the irregular and unsupported expenditure of Ksh301.7 million, a sum equivalent to 3% of the County Government's revenue allocation.
“These fund transfers were made to the Nakuru Alcoholic Drinks and Control Board thereby raising questions about the governance and financial integrity of this body,” a statement from the committee read in part.
Additionally, the report by the Auditor General highlighted irregularities between the county's financial statements and balances recorded on the Integrated Financial Management Information System (IFMIS).
It noted that because of the breaches and irregular transfer of funds, the county executive faced an adverse audit for three consecutive years.
“Inconsistencies in 59 bank balances and misstatement of income derived from technical service fees were revealed by the audit report, which served as the backbone of the discussion.
“Such recurrent non-compliance with numerous acts and regulations pointed towards a systemic weakness in the county's financial management, provoking considerable concern among committee members,” added the statement.
At the same time, the committee noted that the auditor general raised red flags on other matters including the county's failure to submit their financial reports on time.
Other notable issues included the underperformance of own-source revenue generation, a mounting stack of pending bills and oversights in budget execution reports.
"Fiscal challenges plaguing the county were not confined to mere non-compliance. The late submission of financial reports, low absorption of development funds, and the underperformance of own-source revenue.
"Others included flawed budgeting practices, discrepancies in budget execution reports, and a mounting stack of pending bills formed a troubling tableau of financial instability," added the statement.
