PIC asks Auditor-General to reject late reports from parastatals

A parliamentary watchdog committee now wants the office of the Auditor-General to publish the names of State corporations that submit their financial statements on time.

The Public Investments Committee (PIC) further wants the Auditor-General to reject financial statements from corporations that submit them six months after the end of the financial year and instead submit its report to the National Assembly as required by the law.

The proposals, aimed at forestalling persistent delays in submitting documents for audit, are contained in the 21st PIC report that was tabled in the National Assembly on Thursday.

“At the end of three months after the end of the financial year, the Auditor-General should publish and publicise the names of all State corporations that have submitted their complete financial statement for audit,” the report states.

It was tabled in the House by PIC chairman Adan Keynan.

Auditor-General Edward Ouko has in the past complained that parastatals do not submit the audit documents on time, forcing his office to delay publishing them within the stipulated time.

CORRUPTION

This has in turn put Mr Ouko on a collision course with Parliament and other oversight institutions, which accuse him of undermining efforts to fight corruption.

Some of the reasons commonly cited by State corporations for failing to submit required documents are poor record keeping or no record kept and their inability to trace documents at the time of the audit.

The committee says the delays in producing audit documents result in unnecessary queries.

“This delay provides an opportunity for manipulation of documents by rogue officers, encourages creative accounting practices in the public sector and delays the finalisation of audit reports at the expense of the public,” PIC says.

STATEMENTS

The recommendation is meant to put pressure on parastatals to submit the reports on time.

“The accounting officers who submit or delay the submission of the audit documents should be held personally liable and be surcharged for such delays,” says the report.

The law mandates accounting officers in State corporations to prepare annual financial statements for each financial year within three months after the end of the financial year.

This means parastatals must submit their financial statements to the Auditor-General’s office by the end of September.

The statements are then submitted to the Controller of Budget and the Auditor-General for audit.

Mr Ouko’s office has three months to consider the statements and deliver them to Parliament by the end of December.