The Nairobi City County government did not produce supporting documents for the expenditure of more than Sh6 billion for the financial year ending June 2019.
This is according to the latest report by Auditor General Edward Ouko, which was released on March 20, 2019.
During the auditing, the county did not disclose an amount of Sh3,045,914,596 that was held in three different bank accounts.
In one instance, AAR Insurance Kenya Limited was paid an excess amount of Sh652,786,602 for staff medical insurance cover and there was no documents or explanation given for the excess amount.
The audit has also revealed that Sh561,841,394 was spent on asset acquisition for the county but City Hall has not submitted any documentation to support the expenditure.
Similarly, Sh421,287,000 was used by the county to pay for scholarships but has no supporting documents or even the list of the beneficiaries.
Section 104(1) of Public Finance Management Act 2012 requires the county treasury to ensure proper management and control of accounting for finances.
But the Nairobi County government ignored this requirement and irregularly paid suppliers Sh381,841,224 in cash.
It has also emerged that the county used Sh592,852,611 of taxpayers’ money on projects which have long stalled.
Some of these projects include a perimeter wall at Mji Wa Huruma, rehabilitation of Gaturo Road, St Martin’s Catholic Church road, Ndwaru Road in Dagoretti and Mother Teresa Road in Ruaraka.
From the county’s current account held at Equity Bank, a total of Sh209,385,752 was withdrawn. The amount was for unspecified payment and was not supported by an appropriate authority. No supporting documents were provided or a pre-numbered payment made.
The system of revenue collection in the city is that clients are advised of the exact amount they are supposed to pay.
The deposit is made to the county revenue account, upon which receipts are issued by the county revenue office after presenting bank pay-in slips.
With all that system in place, City Hall paid a vendor Sh152,055,313 for purportedly collecting revenue for the county government.
There was no justification for paying the vendor presented for audit.
The local authorities integrated financial operations management system showed that the county government cancelled 210 receipts worth Sh45,364,475 without providing an explanation.
Notable is that the county did not prepare any financial statement for Nairobi City Liquor Licensing Board for two consecutive years.
According to the audit report, the compensation of employees exceeded the 35 percent limit prescribed by law as the county spent 49.4 percent of its total revenue on that vote head.
The audit also found out city health facilities stocked expired drugs since the Kenya Medical Supplies Authority had failed to supply drugs due to delayed payment from the county.
Food handlers in the county were not issued with medical certificates due to lack of funds to purchase laboratory commodities and certificate books.
“I have not been able to obtain sufficient audit evidence to provide a basis for audit opinion on these financial statements,” the Auditor General said.
According to Mr Ouko, the audit from Nairobi executive was a “disclaimer of opinion”, meaning he was unable to review the report.