*.Poor adherence to management policies within the department.

Criteria

According to the public finance management act regulation 2015,"internal control" means a set of systems to ensure that financial and other records are accurate, reliable, complete and ensure adherence to the management policies of the Ministry, department or other agency of Government, for the orderly and efficient conduct of the Ministry,

department or agency, and the proper recording and safeguarding of its assets and resources; irregular expenditure" means expenditure, other than unauthorized expenditure defined under this section, incurred in contravention of or that is not in accordance with a requirement of any relevant legislation, including-

(a) the Act;

(b) these Regulations;

Observation

During the audit assessment within the department, it was discovered that most vouchers were not properly authorized, supported, narrated, dated and/or filed to ensure adherence to laid down policies and regulations.

Risks

This can lead to department losing money through payment of unauthorized vouchers

Recommendations

All payment vouchers must be narrated authorized and fully supported before payment is made.

Management Response

2.Procurement plan figure higher than approved budget figure by kshs. 50,742,383

Criteria

According to Public finance management act 53. (1) All procurement by State organs and public entities are subject to the rules and principles of this Act

(2) An accounting officer shall prepare an annual procurement plan which is realistic in a format set out in the Regulations within the approved budget prior to commencement of each financial year as part of the annual budget preparation process.

Observation

The total budget amount for both health corporate and health services for the year 2019/20 amounted to Kshs. 2,216,617,567 while the procurement plan for the four quarters amounted to Ksh.2,267,359,950, a variation of Ksh. 50,742,383

Risk

Can lead to procuring more than the budget thereby bringing the element of pending bills since commitment cannot be done in the vote book.

Recommendations.

The procurement plan figure should be within the approved budget estimate figure.

Management Response

3.Payments made without vouchers kshs.31,991,945.00

Criteria

According to public finance management act 104. (1) All receipts and payments vouchers of public moneys

shall be properly supported by pre-numbered receipt and payment vouchers and shall be supported by the appropriate authority and documentation.

(2) All receipt and payment vouchers shall be or made out in indelible ink and shall contain adequate narration of the particulars of the services, goods or works procured and being paid for.

(3) All amounts appearing in a voucher shall be written in words as well as in figures.

Observation

The total disbursements received under the operation account (115******* KCB BANK) amounted to KSH 35,000,000 as shown below

DATE

TRANSFERS

30/10/2019

15,000,000

13/02/2020

3,000,000

18/02/2020

3,500,000

19/03/2020

3,500,000

20/04/2020

1,177,626

20/04/2020

1,925,000

22/04/2020

2,322,374

22/04/2020

1,075,000

10/06/2020

3,500,000

TOTAL

35,000,000

The vouchers availed during audit amounted to KSH 3,008,055.00 with a difference of KSH 31,991,945.00 without payment vouchers.

Risk

Can lead to payments being made without payment vouchers.

Recommendations.

Payment vouchers must be raised before a payment is done.

Management Response

4.Quarterly Returns not prepared.

Criteria

According to public finance management act 13 1. (1) A county government Accounting Officer-

(c) shall monitor and evaluate the financial and non-financial performance of programmes funded by a conditional and unconditional transfer from the national government and prepare and submit to the relevant national accounting

officer —

(i) a quarterly report within 15 days after the end of each quarter in a format prescribed by the Public Sector Accounting Standards Board.

Observation.

The accounts department had not prepared quarterly returns for all quarters first, second and third.

Risk

It’s not easy to advice the management on financial matters without the quarterly returns

Recommendations.

The accounts office to prepare timely quarterly returns.

Management Response.

5.Un surrendered imprests kshs.2,500,000

Criteria

According to public finance management act (93)(5) A holder of a temporary imprest shall account or surrender the imprest within 7 working days after returning to duty station.

. (7) If the Accounting Officer does not recover the temporary imprest from the defaulting officer as provided for in this regulation the Accounting Officer commits an offence as provided for under the Act.

(8) In order to effectively and efficiently manage and control the issue of temporary imprests, an accounting officer or AIE holder shall ensure that no second imprest is issued to any officer before the first imprest is surrendered or recovered in full from his or her salary.

Observation

Most of imprests issued had not been surrendered within the timeline stipulated resulting to a total of kshs. 2,500,000 unaccounted for as at the date of audit assessment

Risk

The department may not fully recover the imprests .

Recommendation

Imprests policies and regulations must strictly be adhered to.

Management Response.

6.Irregular withdrawal of kshs.400,000 from donor funded account.

Criteria

According to public finance management act 82 (4) Except with the prior authority of the National Treasury, no accounting officer may open a bank account for the deposit, custody or withdrawal of public moneys or other moneys for which he or she is responsible in his or her official capacity or for the transaction of

official banking business.

Observation

It was noted that the department management withdrew a total of kshs.400,000 from donor funded account and deposited it into another account.

The management did not give clear details as to why these transactions were made.

Risk

This can lead to misappropriation of government funds by departmental heads.

Recommendations.

Withdrawals must follow the duly laid down policies and procedures.

Management Response.

7.Vote book not maintained.

According to public finance management act 52(1) (d) when the AIE is issued by the Ministry or State Department or Agency, the allocation shall be entered as a commitment in the Ministry's or State Department's or Agency's master vote book so as to ascertain at all times the availability of uncommitted funds;

Observation

The department did not maintain vote book for all the funds allocated to them such as development fund.

Risk

This can lead to overspending of some vote heads.

Recommendation

Vote book should be made for all monies allocated to a department.

Management Response.

8.Memorandum Cash book not maintained at the department level.

Criteria

According to public finance management act 93(14),The holder of a standing imprest shall keep a memorandum

cash book to record all receipts and payments and the balance on hand shall agree with the cash balance recorded in the cash book, and in the absence of any receipts, the actual cash balances plus the expenses paid shall equal at all times the fixed level of the imprest for which the imprest holder is personally responsible.

Observation

The department accountant designate did not have any financial documents to show how much is received and how they have been spent and the actual balance as at the time of audit.

Risk

The holder of standing imprest may divert funds to other un intended use.

Recommendations

The department accountant should maintain the memorandum cash book for standing imprest.

Management Response

9.Project implementation status (PIS as at 30,june 2020)

According to the public finance management act 77. The Accounting Officer of a project shall compile and maintain a record showing all receipts, disbursements and actual expenditure on a monthly basis in respect of every project and subproject and shall —

(a) make monthly interim financial returns;

(b) make quarterly financial management returns;

(c) submit a summary of the records for each quarter and year to the division responsible for external resources in the National Treasury not later than fifteen (15) days after the end of every quarter

Observation.

The department did not maintain record of projects undertaken during the financial year under review.

This was an indication that during the year, no projects had been undertaken.

Risk

Value for money may not be achieved.

Recommendation

The department should develop a list of project and their status which should conform to the budget allocation on the identified projects.

Management Response.

Non adherence to approved budget estimates.

1.CHQ 002383- No supporting document: proof of travel- TIBERIUS MATOFALI

2.OFFICERS LUNCHES RATE STANDS AT 1000 PER DAY. ON 4TH AND 5TH THREE OFFICERS RECIVED 2500 PER DAY

3.Most vouchers were not were not entered in the vote book thereby making the vote book inconsistence with the cash available.

4.Bank reconciliation statement

5.During the year under review the health development had an approved development budget of Kshs. 540,866,819 both for ward specific and executive. During the year, there were no any projects undertaken resulting to overall under absorption hence no value for money

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