Embu Governor Cecily Mbarire on Monday, July 17, came under intense scrutiny over misappropriation of Ksh184 million at the Embu Water and Sanitation Company Limited.
The Senate Committee on County Public Investments and Special Funds summoned the county chief after Auditor General Nancy Gathungu raised concerns regarding the use of public funds at the water company during the financial year 2020/2021.
Referencing the report, the senators raised several issues including mismatched cash balances, incorrectly labeled trade receivables, inconsistencies in the VAT ledger, and discrepancies between the computerized system and the balances in the financial statements.
The legislators also raised several issues highlighted in the audit such as underreported water and wastewater balances, inaccuracies in customer and direct deposits, and unsupported trade payables and accruals.
Other issues the senators took issue with included; unsupported administration costs and staff allowances, dubious board expenses, and missing ownership documents for assets worth Kshs.184 million.
Concerns were also raised about the company's outstanding tax arrears. In line with this, Mbarire was tasked with ensuring total remittance compliance during her tenure and the Auditor General's office was asked to submit a follow-up report.
"The company's issues did not end there. The lack of a policy for paid airtime benefits, insufficient documentation supporting a billing software upgrade and trade receivables adjustments, a budget deficit, unresolved audit issues," a statement released by the Senate read.
"Others included high levels of non-revenue water, lack of staff diversity, employee underpayment, outstanding corporate taxes, and missing risk management and ICT policies also added to the list of discrepancies."
After digging through the report and listening to listening to the governor’s responses, the Elgeyo-Marakwet Senator William Kisang-led committee directed Governor Mbarire to submit essential documents related to the board's establishment within 60 days.
The committee also directed Mbarire to guarantee the proficiency of the accounting and finance department staff. Capacity building for current staff was identified as a crucial need.
Similarly, the committee directed the directors of the company to streamline the firm's processes to align with the Water Act 2016 within 60 days.
The committee further directed Governor Mbarire to ensure stricter management of the water company going forward.
Additionally, the first-term governor was asked to address governance issues like asset management, risk management, and internal controls.
Acknowledging the high levels of non-revenue water, the committee directed the Auditor General to evaluate the effectiveness of proposed remedial actions.
If found culpable of any irregularities, the governor and the water company's directors stand liable to either face a fine of not exceeding Ksh5 million or three-year imprisonment or both.
