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Treasury probes counties for suspect revenue figures

The National Treasury building in Nairobi. FILE PHOTO | NMG
The National Treasury building in Nairobi. FILE PHOTO | NMG 

A number of county governments are under investigation by the Treasury for falsifying their revenue collection figures after an audit revealed a mismatch between expenditure and cash generate.

An audit of bank statements and expenditure returns by the Controller of Budget Office revealed that spending in the past three years exceeded their total own source revenue (OSR) as well Exchequer releases from the County Revenue Fund (CRF) to operational accounts.

“Such violations suggest that OSR is being spent at source. The Controller of Budget has analysed counties and identified those where not all OSR is ‘swept’ into respective CRF accounts” the Treasury said in its Budget Policy Outlook statement for 2017.

The law stipulates that the total revenue collected by all counties be distributed equitably in accordance with a resolution approved by Parliament.

Revenue without approval

Several counties were, however, found to have directly spent revenue without approval.

“The Treasury is investigating these violations, and legal and intergovernmental mechanisms will be pursued to help resolve challenges in specific counties” the Treasury said without providing details on the affected counties.

This came as Treasury data showed that revenue collection by counties dropped by Sh1.2 billion in the nine months to March compared to a similar period last year, pointing to possible borrowing by the devolved units to finance some of their operations.

“The Treasury is investigating these violations, and legal and intergovernmental mechanisms will be pursued to help resolve challenges in specific counties” the Treasury said without providing details on the affected counties.

This came as Treasury data showed that revenue collection by counties dropped by Sh1.2 billion in the nine months to March compared to a similar period last year, pointing to possible borrowing by the devolved units to finance some of their operations.

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