•Auditor General Nancy Gathungu also flagged salaries paid beyond legal threshold.
•KSG has been called out over an unsupported Sh134 million which was paid to the contractor
Image: FILE
An audit has flagged possible loss of millions of shillings in stalled projects and revenue leakages at the Kenya School of Government.
Auditor General Nancy Gathungu has cited among others, hundreds of millions that may have gone down the drain at works on a tuition block at the Baringo campus.
In the project, KSG has been called out over an unsupported Sh134 million which was paid to the contractor.
Gathungu reported that a site visit conducted this February revealed that no work has been carried out in the year under review.
"The contractor had abandoned the site. Further, the status of project completion report in the financial statements indicates that it was at 22 per cent completion with an expended amount of Sh134,892,648 not supported with any documentation," Gathungu said.
The project was also found to be behind schedule, as it was to be completed by December 2022.
"No extension of the contract has been given despite the expiry of the contract duration. In the circumstances, it is doubtful whether the outstanding works will be completed so that the tuition block can serve the intended purpose," she said.
A Sh1.1 billion convention centre at the KSG Embu campus is also wasting away, with no contractor on site.
Gathungu has red-flagged the project saying value for money paid to the contractor may not be achieved due to the construction delay.
“Review of progress reports and physical verification of the project carried out in February 2024 revealed the contractor had abandoned the site. This is due to delayed payment of certified works. Further, the project is incomplete and is significantly behind schedule," the report reads in part.
The public, the auditor general says, may also not get value for money in Sh91 million spent on a tuition block at the Matuga campus whose construction has been inordinately delayed.
The delays have been blamed on subcontractors who got part work on the Sh745 million project.
"Site reports indicate that the absence of sub-contractors caused the delay. Further, records indicate structural flaws, material wastage and the project is significantly behind schedule," Gathungu said.
"In addition, the management did not provide a revised work plan, therefore the revised date of completion after the previous contract expired could not be confirmed."
Delays have also accosted works on a deputy director's house in Baringo campus after a dispute over nonpayment of certified works of Sh2 million.
The contractor, according to auditors, abandoned the site in 2017 due to non-payment.
It also came out that works done so far had deteriorated, meaning taxpayers will pay more for repeat jobs.
"In the circumstances, value for money on the project may not be achieved and management may incur additional costs to rehabilitate the house."
On revenue, KSG could be losing millions as a result of leakages.
Auditors established that it was difficult to confirm whether all the invoices sent are invoiced for revenue recognition.
The system does not generate reports for all six campuses making it difficult to generate a consolidated report.
It is thus hard to determine all the rental properties owned by the school, the number of training carried out, conferences, workshops and all the other sale services offered and sales at every campus and department.
Gathungu also queried why all the committed customer bookings data cannot be retrieved from the data entry source once submitted for invoicing.
“As a result, no confirmation could be done on whether all the booked clients were invoiced,” the auditor general said.
It also emerged that despite the existence of an ERP system, the hospitality and accommodation services have not been automated on all the campuses.
“Failure to automate the function creates opportunities for mismanagement of facilities and inaccurate revenue recognition at the departmental level,” the report reads in part.
“In the circumstances, the effectiveness of internal control measures on revenue collection is weak and could not be confirmed,” Gathungu said.
Further, the school does not maintain a separate retention account which would be used to deposit retention money and pay when they fall due.
The Public Finance Management Act, 2012, requires an accounting officer to ensure all contracts entered into by the entity are lawful and are complied with, hence management was in breach of the law.
Kenya School of Government was also found in breach of the limits for salaries in the face of employee costs accounting for 62 per cent of the total revenue of Sh1.9 billion.
The PFM Act states that the national government’s expenditure on wages and benefits for its public officers shall not exceed 35 per cent of the national government revenue.