More controversies emerge over 2007/08 revenue accounts

The controversy surrounding the inconsistencies in the revenue statements for the fiscal year 2007/08 deepened on Friday after the Auditor-General presented two different sets of figures.

(Read: MPs passed unaudited accounts for 2007/08, says Treasury official)

Auditor-General Edward Ouko climbed down on an earlier statement by Sh77 billion to confirm that the country collected Sh419 billion in Ordinary Revenue as opposed Sh496 billion.

Parliament heard that the Treasury made a revision to the estimates approved by the House contrary to the law, leading to serious inconsistencies in the accounts declared to the Auditor General and those given to MPs.

This emerged as Mars Group- a governance and accountability watchdog - confirmed the mystery in the Treasury’s revenue accounts claiming that the country has no idea of what was collected even in the just concluded financial year.

Mars Group chairman Mwalimu Mati and executive directors Jane Mati called for a forensic audit into the revenue statement accounts from 2007 to date saying there were serious disparities in what was declared to the Auditor-General, Parliament and what was certified as the actual receipts in the exchequer account.

The group which appeared before three joint committees investigating the inconsistencies in the 2007/08 revenue statement accounts with regards to ordinary revenue said the malpractice continued in the subsequent financial years.

The House wants to find out the truth in the figures after Treasury presented four different figures in ordinary revenue collection. The Auditor General was given a figure of Sh496 billion to audit, Parliament Sh397 billion while Kenya Revenue Authority, which collects revenue for government, put the figure at Sh433 billion

“What they have not lied to you in terms of total revenue collected by the government is the 2010/2011 financial year accounts because they have not reported as required in the current fiscal year,” said Mrs Mati.

She told the Budget, Finance and Public Accounts committees that the Controller and Auditor General then Mr Gatumbu signed alongside Permanent Secretary Joseph Kinyua and issued a certificate to that effect that government collected Sh498 as ordinary revenue.

But in a letter to the committee that was delivered Thursday, Mr Ouko, who appeared before the probe team last week confirmed that Treasury collected Sh419 billion in the fiscal year in question.

“The question in many Kenyans minds is that, what did the government collect? There is a certificate issued in May 2009 certifying that Sh516, 108, 407, 205.15 was collected out of which Sh496 billion constituted ordinary revenue (taxes). The letter we have from the Auditor General dated July, 19, 2012 shows that Sh516, 108, 407, 205.15 was collected out of which Sh419.3 billion constituted ordinary revenue,” asked John Mbadi who originated the probe.

Mars Group differed with both Treasury and the Auditor-General that the books of account had been reconciled saying 18 out of 57 audit queries had been responded to.

Mrs Mati gave an example of Taxes on Income, Profits and Capital Gains vote which has five different figures. She said the figure in the exchequer account showed that it had Sh168.3 billion, Kenya Revenue Account had Sh166 billion, treasury ledger Sh173 billion, the revenue statement showed Sh177.2 billion while parliament was told of Sh165.1 billion. “It is impossible to have different revenue figures for one revenue vote head,” she said.

The group also gave examples of Taxes on Goods and Services Account as having discrepancy of about Sh3.7 billion, statement of liabilities and assets with a difference of Sh5.4 billion and arrears of revenue that are due as being unaccounted for.