Auditor-General Nancy Gathungu has revealed that the Sh475.52 million financing deal by Kenya to support the 2023 African Climate Summit (ACS) it hosted in Nairobi was signed after the conference.
Ms Gathungu, in a report on the accounts of the Environment and Climate Change Department for the financial year 2023/24, expresses doubts on the eligibility of the expenditure, stating that the funds may have been diverted to non-intended use.
She notes that Kenya entered into the grant agreement of $3,000,000 with the African Development Bank on November 15, 2023, to finance the ACS that was held from September 4-8, 2023.
This is despite the agreement stating that the grant was to be used exclusively for “meeting the cost of eligible activities” of the ACS and thereafter adaptation compacts.
Ms Gathungu adds that the Sh475.52 million was disbursed to the project’s special account on January 3, 2024, four months after the summit.
The auditor concludes that due to this confusion and the government's inability to explain it when the audit was conducted, “the eligibility of the expenditure could not be confirmed”.
According to the audit report, the agreement provided that the grant was to partially cover expenses on flight travel, hotel accommodation and conference facilities for the participants.
Any financial resources of the grant that remained unexpended after the eligible commitments and liabilities had been satisfied were to be reimbursed to the bank.
The audit further notes that although the special account reconciliation statement reflects withdrawals of Sh330.24 million made to finance the ACS activities, only Sh4.92 million was reflected in the project financial statements as proceeds from domestic and foreign grants.
“The amount may have been utilised for expenditures other than activities provided for in the financing agreement,” reads the audit report.
The report has also flagged inaccuracies in the project’s financial statements, including an unidentified person signing them on behalf of the project coordinator.
