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{
    "id": 696782,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/696782/?format=api",
    "text_counter": 210,
    "type": "speech",
    "speaker_name": "Hon. Ichung’wah",
    "speaker_title": "",
    "speaker": {
        "id": 1835,
        "legal_name": "Anthony Kimani Ichung'Wah",
        "slug": "anthony-kimani-ichungwah"
    },
    "content": "The eighth general observation is on unqualified audit opinions. The Committee commends State corporations which obtain well deserved and unqualified opinion from the Auditor-General. I beg your indulgence, Chair, to mention a few of the State corporations that have unqualified audit reports from the Auditor-General. This means that throughout the audit period that we were covering, many of those State corporations did not have audit queries in their audited financial reports. They include the Retirement Benefits Authority (RBA), the Information and Communication Technology Authority, the SACCO Societies Regulatory Authority (SASRA) and the Unclaimed Financial Assets Authority (UFAA). The latter is relatively new, but they have started very well. We pray that they continue that way. Other State corporations that have unqualified audit opinion include the Micro and Small Enterprise Authority (MSEA), the State Corporations Appeal Tribunal (SCAT), which also received an unqualified audit opinion in 2008/2009 and 2012/2013 Financial Years despite having a pending audit query on over-payment to board members in 2001, 2002, 2007 and 2008. This is a matter of concern because we previously noted similar cases as captured in our 18th and 19th Reports. We have the case of the National Social Security Fund (NSSF) where they have a qualified audit opinion in one year and unqualified audit opinion in the other. This is a concern we raised with the Auditor-General in a meeting held under the chairmanship of the Speaker with the Big Nine, including the Auditor-General’s Office and the Attorney-General’s Office, and other players together with our colleagues in the Public Accounts Committee (PAC). The Committee is equally concerned with the application of Section 39 of the Public Audit Act, 2003 by the Auditor-General to outsource the audit of strategic Governments entities to private auditors. The Committee has observed that this practice is more rampant in the energy sector State corporations like the Geothermal Development Company (GDC), the Kenya Electricity Transmission Company (KETRACO), the Kenya Electricity Generating Company (KenGen) Limited, as well as in the financial services sector. The Office of the Auditor-General, which is funded by the Exchequer or allocated monies by this House to conduct audits, outsources the same audits to private sector players. Some of the contracted audit firms have questionable track records in terms of the way they conduct their audits. Some of them have had issues in the private sector. I wonder whether such firms can perform in the public sector. The ninth observation is delay in availing documents to the Auditor-General. This is quite rampant. It becomes a problem to the Auditor-General when State corporations fail to avail documents to auditors as they conduct audits or, by the time they draw up their management letters. It is only when the respective management teams appear before PIC or PAC to respond to audit queries that they avail the documents to the auditors. We want to encourage the management teams of the various State corporations to avail documents to the auditor during the audit. That is one way of avoiding audit queries. It saves time not just for the Auditor-General’s Office, but also for Parliament. In many instances, we scrutinise things which the auditors could have cleared in the course of the audit. State corporations need not come to Parliament to respond to audit queries. The tenth general observation is on delay on appointment of board members. Again, we are cognizant of the fact that CEOs of State corporations do not appoint their own boards. In fact, the CEOs are hired by the boards. We have observed that very many State corporations, especially in the last three years, had to operate without boards. Very many decisions could not be made because the affected State corporations did not have boards to make them. In our 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."
}