The Senate Committee on County Public Investments and Special Funds today held a meeting with Nakuru Governor Susan Kihika. The focus of the meeting was to review the Auditor-General's reports on the Nakuru County Emergency Fund and Nakuru Bursary Fund, covering the fiscal years from 2020 to 2022. 

The reports exposed significant deficiencies in financial management and controls. The auditor expressed dissatisfaction with explanations provided for discrepancies and highlighted the absence of internal audit functions. Governor Kihika acknowledged these shortcomings and pledged to address them in the next audit cycle.

After careful examination of the Auditor-General's findings and Governor Kihika's responses, the Committee outlined measures to improve transparency and financial governance in the county.  

The County Executive Committee Member (CECM) for Finance has 60 days to establish effective internal control systems and policies that align with legal requirements. Evidence of implementation must be submitted to the Auditor General for verification. Additionally, the Governor, through the CECM for Finance, is responsible for ensuring accurate financial record-keeping by fund administrators in accordance with the Public Finance Management Act, 2012.

The Committee also directed full compliance with the Public Sector Accounting Standards Board (PSASB) template when preparing annual reports and financial statements. It emphasized the importance of timely allocation of funds to prevent disruption of planned activities and insisted on the appropriate customization of accounting templates prior to their use. The qualifications of officers in the Accounts and Finance sections were scrutinized, and the Committee stressed the need for ongoing capacity building in these departments.

Irregular payments of allowances to County Assembly members and staff from the Emergency Fund in the 2019/2020 financial year drew particular concern. The Committee demanded a satisfactory explanation within 30 days, failing which the Governor will be required to initiate a recovery process for the irregular payments totalling Kshs. 6,048,700. 

Finally, the Auditor-General will review supporting documentation related to gift voucher and food pack expenditures drawn from the Emergency Fund in 2020/2021, and the Governor is expected to provide any necessary clarifications. The Committee made clear its expectation that all future fund-related expenditures receive proper legal approval.