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{
    "id": 1550034,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1550034/?format=api",
    "text_counter": 313,
    "type": "speech",
    "speaker_name": "Butere, ODM",
    "speaker_title": "Hon. Nicholas Mwale",
    "speaker": null,
    "content": "‘The Committee recommends that the National Treasury conducts periodic sensitisation and capacity building of all accounting officers, finance staff and procurement officers across the Government on their responsibilities during the audit cycle and adherence to International Public Sector Accounting Standards Board (IPSASB)’ The second recommendation is on late submission of supporting documents. For the Office of the Auditor-General to come up with an unqualified opinion, it has to be furnished with relevant supporting documentation to prove what the funds were used for. We have seen in many of the audit opinions that the Office of the Auditor-General was not furnished with the requisite documents as requested. Therefore, we are recommending that Section 68(2)(k) of the Public Finance Act be adhered to by State agencies so that information is provided on time for the Auditor-General to do the scrutiny. The other observation is non-existent or weak internal audit functions. As you are aware, every State agency is supposed to have an internal audit function. However, the audit opinions have shown clearly that many of those State agencies lack internal audit committees. So, the function is not practiced in many State agencies. The Committee reiterates its previous recommendation that the National Treasury should submit a proposal to the National Assembly within three months of adoption of this Report, delinking internal audit function in terms of appointment, facilitation and reporting from accounting officers to an independent office. The other issue, which is an observation and a recommendation under number four, is the long outstanding construction works and stalled projects. In many cases in this country, we see many projects stalling and they end up wasting public funds because of harsh climate conditions. Some of them are subjected to inflation. The variations that are done actually end up making the projects very costly. Therefore, the Committee recommends that the National Treasury should only approve projects for which it can guarantee funding and completion within the medium-term expenditure framework. No new projects should be commenced by an agency before all existing ones are completed and fully funded. We have the issue of budgetary control and performance. This arose from all Ministries and State departments. Under budgetary control and performance, the issues raised are predominantly about late exchequer issues, supplementary budgets and incapacity to collect targeted revenues. The Committee recommends that the National Treasury, the Budget and Appropriation Committee, and the Departmental Committee on Finance and National Planning make realistic revenue projections and attainable expenditure estimates. The elephant in the room is pending bills. We have seen so many companies and so many Kenyans who are suffering because of the Government not paying for goods supplied and services rendered to Government institutions and projects. Pending bills are a major issue when you talk about the economy being revived and surviving. Therefore, the Committee recommends that the Treasury only rationalises budgets that have not been committed. Further, the Committee recommends that borrowing by the National Treasury to plug budget deficits should be done uniformly across the financial year to avoid the end-year rush of disbursement and procurement in an effort to beat the deadline. Hon. Temporary Speaker, there is the issue of accrual and cash basis of accounting. I am very sure that many Members are familiar with it. It is a basic principle of accounting. Many national Government institutions and State agencies use the cash basis principle, and this has a lot of disadvantages and drawbacks when it comes to accountability and keeping of financial records. The Committee recommends that the National Treasury expedites the full rollout of accrual basis of accounting as this is going to give the true picture of the financial state of our State departments and agencies. The time is almost 7.00 p.m. That is why I am summarising so that I give my Vice- Chairperson ample time to second the Motion and pave way for Members to contribute. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}