Edward Ouko raised the red flag on NCPB’s failure to provide payment vouchers and supporting expenditure worth Sh4,494,724,000 relating to importation of maize.
The maize was imported between the months of May and June during the duty-free importation window.
Mr Ouko said the NCPB is technically insolvent after posting Sh3.7 billion losses in the year to June 2017. This was, however, lower than Sh4.8 billion incurred as at June 30, 2016.
The National Cereals and Produce Board (NCPB) cannot support payments worth Sh4.5 billion to five private companies that imported maize even as Auditor-General declared it technically broke.
Edward Ouko raised the red flag on NCPB’s failure to provide payment vouchers and supporting expenditure worth Sh4,494,724,000 relating to importation of maize.
The maize was imported between the months of May and June during the duty-free importation window.
Pembe Flour Mills, Mombasa Maize Millers, Kitui Mills Ltd, Hydery P Ltd and Export Trading brought in the grain and sold to NCPB at a cost of Sh4.49 billion between May 19 and June 23, 2017.
Hydery P was paid the lion's share of Sh3 billion, Mombasa Maize Millers (Sh609 million), Kitui Mills and Pembe Flour Mills (Sh400 million each) and Export Trading (Sh3.5 million).
“The statement of financial performance reflects an amount of Sh11,672,958,682 under costs of sale. However, payment vouchers and supporting documents for expenditure totalling Sh4,494,724,000 relating to importation of maize … have not been provided for audit review.
“Consequently, the propriety of expenditure totalling Sh4,494,724,000 cannot be ascertained,” Mr Ouko said.
Mr Ouko said the NCPB is technically insolvent after posting Sh3.7 billion losses in the year to June 2017. This was, however, lower than Sh4.8 billion incurred as at June 30, 2016.
“The persistent financial loss is an indication of existence of a material uncertainty that cast significant doubts about the ability of the board to continue as a going concern,” Mr Ouko said in a disclaimer audit opinion, meaning he was unable to obtain sufficient audit evidence to express an opinion.
Mr Ouko put the NCPB on the spot for overstating the procurement of gunny bags worth Sh842 million. however, he said, records showed the NCPB spent Sh401,4060,400 on buying the gunny bags in the year to June 2017.
The difference of Sh440 million was neither supported with documents nor explained.
Mr Ouko said documents provided for audit review indicated that two firms were awarded contracts during the year 2016/17 to supply gunny bags; one supplying 2.7 million bags and the other 525,000.
“However, it is not clear how the two firms were identified as no documentary evidence has been provided to show the procurement method and procedures followed,” Mr Ouko said without disclosing the identities of the companies.
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