Friday, March 29, 2024

All county governments fail to adhere to audit standards

Audit standards: Less than half of government Ministries, Departments, and Agencies are keeping their books of accounts in compliance with auditing standards.

This is according to the latest Office of the Auditor General’s report for the year 2020/2021, which indicates that 54 percent of government institutions have material misstatements or omissions in their financial statements. None of the county governments is adhering to auditing standards when it comes to accounting for the use of cash from public coffers.

The office of the Auditor General has raised concern over financial transactions made by county executives- CECs over the last five years, following an increase in material misstatements or omissions in the financial statements submitted to the audit body.

According to the 2020-2021 audit report, qualified opinions have been on an upward trajectory from 28 percent in 2015/2016 to 87% in 2019/20. This was contrary to the performance by county assemblies -MCAs whose anomalies in financial transactions have been on a downward trend from 13 percent in 2015/2016 to nil in 2019/20.

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Findings of the 2020-2021 audit report, indicate a general improvement in accountability, use, and management of public resources.

The number of financial statements with modified/qualified opinions decreased from 48.0 to 45.5 percent; where modified/qualified opinions point to a large extent agreement with the submitted records albeit with material misstatements or omissions in the financial statements.

In such a case the office of the auditor general issues a letter of notice to the entity in question for a response. However, the Auditor General has raised concern over the management and use of public resources by county executives.

In its latest report, the auditor general office indicates that County Assemblies performed better compared to the County Executives In the last five years. Though 32 percent of the County Assemblies recorded disclaimer of opinion in 2015/2016 financial year, it reduced to 13 percent in 2016/17 and six per cent in 2017/18.

In 2018/2019 and 2019/2020 the Assemblies fared much better with no entity recording a disclaimer of opinion; where a disclaimer points to serious and significant misstatements from limitation of scope and lack of proper records such that the Auditor-General is not able to form an opinion on the financial operations.

The Assemblies also recorded a steady improvement in unmodified opinions, from no entity posting an unmodified opinion in 2015/2016 and 2016/2017 to two percent in the subsequent year, four percent in 2018/2019 and six percent in 2019/2020.

On the other hand, County Executives did not post impressive figures with the number of entities getting qualified opinions increasing from 28 percent in 2015/2016 to 87 percent in 2019/2020. This means county assemblies were more transparent and accountable in spending allocated public coffers than their executive officeholders over the last 5years.

To enhance accountability the office of the auditor general will going forward publish the audit reports in both English and Swahili. Stakeholders have lauded the move saying it will go a long way in breaking down financial reports hence boosting citizen accountability.

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