Audit firm warns of county spending leakages

Counties are sealing deals worth billions of shillings without sound financial management systems, risking massive fiscal leakages, a consultancy has cautioned.

Audit firm Crowe Horwath says the devolved units must invest in setting up systems to monitor and ensure public funds on their watch are utilised well.

Chief executive Coutts Otolo says so far little effort is going into investing in financial structures despite most of the devolved units entering into huge contracts involving public funds.

“We want the agenda of financial structures and efficient management to be at the top of each county’s agenda because there is a lot of money coming their way from the central government,” said Mr Otolo.

He spoke as the firm hosted its key clients at a meeting attended by the Crowe Horwath global chairman Andrew Pianca in Nairobi.

Mr Otolo said that devolution had created a huge demand for accountability and responsible management by the county governments and suggested audit and accounting firms should offer solutions in proper use of public funds countrywide.

The Ethics and Anti-Corruption Commission has announced that all the county governments are being investigated over utilisation of funds and nepotism.

The investigations come at a time when Embu governor Martin Wambora has been impeached by the Senate over misuse of funds. An audit gap has emerged with the Transition Authority handing over the role to the Auditor-General who will be constrained to cover all counties.

Mr Otolo told the gathering that Crowe Howarth plans to open offices in Mombasa, Nakuru and Kisumu to meet growing regional demand of services by county governments.

Crowe Horwath EA is a consultancy offering audit, tax, risk and management advisory solutions.

“We are setting up responsive offices because we believe that we should be firmly represented in all the key counties by the end of 2015,” he said.

The company’s strategy will focus more on emerging opportunities in oil, gas and energy generation sectors in Kenya “where we want to provide international expertise that is focused and responsive”, said Mr Otolo.