Treasury audits IFMIS after NYS scam raises integrity claims

The State is auditing the Integrated Financial Management Information System (IFMIS) whose integrity was put to question after the multi-million shilling National Youth Service fraud.

Finance principal secretary (PS) Kamau Thugge said the Auditor-General is almost done with the assessment of the system, scheduled to be fully rolled out in counties.

“We are also looking at risk management on the system and here we are looking at possibly having triggers in place so that fraud can be detected before any funds are lost. This will be in addition to the audit trails already in place,” he said.

Integrity of the payments and procurement system that connects all ministries electronically allowing tracking end-to-end transaction was put to serious doubt after it was claimed fraudsters interfered with it to steal hundreds of millions from National Youth Service (NYS).

Parliament’s Public Accounts Committee Wednesday visited the offices of IFMIS infrastructure and operations.

“The aspirations of the system are good and we need to inform Kenyans about its benefits,” said chairman of the committee, Nicholas Gumbo.

Previously there have been complaints by ministries that the system was giving erroneous reports whose figures conflicted with their own data.

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Dr Thugge defended the system arguing it allowed traceability in budgeting, making room for monitoring progress of development projects.

“It has successfully assisted investigating authorities by giving them audit trails that they can follow and bring a case to conclusion. These audit trails cannot be done without IFMIS,” he said.

The Treasury has disclosed different investigative and prosecution agencies have been given access to the system to quickly handle fraud cases.

The system is currently being implemented at county governments who have complained of poor connectivity and low user knowledge.

The Treasury hopes to use it to cut procurement costs by ensuring items such as office goods pricing reflect actual market prices.

The government, which is the largest consumer of goods, is usually charged higher prices by suppliers who argue they are covering their margins from delayed payments.

“Full IFMIS e-procurement utilisation is expected to entrench efficiency, effectiveness and accountability of public funds by ensuring that procurement is aligned with planning,” said the Treasury in this year’s Budget Policy Statement.