The Ministry of ICT has over Sh3.2 billion in dubious pending bills, plus a host of other financial improprieties, according to the latest report by Auditor-General Edward Ouko.
The report for the year ending June 30, 2018, tabled in the National Assembly last week by Majority Leader Aden Duale, noted that the ministry’s Department of Broadcasting and Telecommunications could not provide proof for, or explain, how it incurred debts.
BANK STATEMENT
The bills are dominated by debts owed to local media houses for advertising services.
The report, to be considered by the National Assembly’s Public Accounts Committee (PAC) chaired by Ugunja MP Opiyo Wandayi, noted that bills totalling Sh633.7 million were, curiously, listed without details of the supplier and could not, therefore, be authenticated.
In some instances, the bills indicated the year of supply but did not have invoices indicating when the supplies were made.
For instance, a demand letter from the Nation Media Group indicated that it was owed Sh597,396,960 in advertising fees. But the figure in the department’s pending bills indicates that the media house is owed Sh1,197,108,548.
“The resulting unreconciled variance of Sh599,711,588 was not explained. In view of the foregoing, the completeness, validity and accuracy of the pending bills could not be confirmed,” the report says.
Apart from the pending bills, Mr Ouko also questioned the Sh1.5 billion in unsupported adjustments and inaccuracies in the department’s financial statements.
The ministry also failed to provide bank statements supporting the receipt of Sh2.4 billion from the National Treasury.
AUDIT REVIEW
The transfer of Sh1.4 billion to other government units could also not be verified, since the ministry’s reported balance for individual agencies did not agree with the agencies' records.
For instance, although the ministry’s records show that it transferred Sh854.1 million to State broadcaster Kenya Broadcasting Corporation, in its financial statement it notes that it received only Sh842.5 million.
“This is noncompliance with the Public Finance Management Act regulations 2015,” the report says. Government regulations state that every year, accounting officers must prepare a procurement plan, which forms the basis for procurement undertaken by State entities in the fiscal year.
Notably, the department did not present a contract that saw a Kenyan law firm paid Sh25 million for legal services after the government was sued in England over some Anglo Leasing-related contracts.
The department deposited Sh4 million into the law firm’s account, but the firm contested the figure and filed a bill of costs at the commercial court, against the Auditor-General on behalf of the ministry. The commercial court dismissed the case, and the firm appealed to the High Court, which awarded it Sh25 million, saying the earlier amount was inordinately low.
“Though the ministry paid the Sh25 million to the A-G for onward transmission to the law firm, no evidence of any contractual agreement between the ministry and the firm was availed for audit review,” the report says.
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