NYS on the spot again
Tyres of unquantifiable amount are lying idle at the National Youth Service (NYS) since 2017, a new report shows.
The report by the Auditor General Nancy Gathungu shows that the tyres, which are part of inventories worth Sh255 million, had not been captured in the stores ledger cards or taken on charge in the inventory records.
“Under the circumstances, the inventory though belonging to the fund had not been included in the total inventory value as at June 30, 2019, and hence the stock value in the financial statement is understated and inaccurate,” reads the report in part.
Gathungu, in the report tabled in the National Assembly last week, also raised concerns that spares procured in the financial year 2014/2015 amounting to Sh175.8 million which had no movement or consumption during the financial year 2017/2018 and 2018/2019 may be obsolete as they are of no use.
She noted that there is need for NYS to adhere to asset management as per regulation 139 of the use of public Finance Management (National Government) regulations 2015.
“In addition, the closing inventory of Sh255 million for the year ended 30 June, 2019, has no supporting documents with regard to the quantities and inventory valuation, neither was there evidence or disclosure of the criteria used to value the inventories reported in the statement of financial position, which requires that inventory be reported at the lower cost or net realisable value,” reads the report.
NYS is also on the spot over the Sh3.2 billion relating to plant and heavy machinery, which the funds management has not valued for financial reporting since inspection.
“The statement of financial position as at June 30 reflects a total non-current assets balance of Sh4.9 billion, which includes an amount of Sh3.2 billion relating to plant and heavy machinery.
“However, the funds management has not valued the plant and heavy machinery for financial reporting purposes since inception,” Gathungu said in the report.
The auditors could not also verify assets owned by the NYS Mechanical and Transport Fund that were procured during the year at a cost of Sh12.96 million, and which included 10 motorcycles, 21 diesel generators and 10 water pumps.
Gathungu said that evidence that the management of the fund complied with the public procurement law and procedures to purchase the said items and the distribution list for the items could not be possible as the said documents were not provided for audit verification.
Auditors noted that logbooks or ownership documents for assets amounting to Sh43.8 million were not availed for audit verification while five of the 27 buses used for commuter services were not in use due to maintenance challenges hence grounded.
“ No evidence has been provided to show the procurement of spares to reinstate the vehicles back in the service,” reads the report.
More plunder Meanwhile, Gathungu, in her report, has also raised concerns over how the Women Enterprise Fund (WEF) spent Sh6.23 million on staff airtime allowances. She regretted that the amount was not subjected to tax in line with the Income Tax Act and that no explanation was provided for the non-compliance.
The Sh6.2 million is part of the Sh18.8 million that the fund incurred on communication, electricity, water and other supplies and services expenses. Consequently, Gathungu has also raised the red flag over Sh6 million of the Sh151.3 million being held under an M-Pesa account, which could not be traced.
“Verification of the Mpesa balance disclosed that an amount of Sh6.2 million under the utility account balance has been excluded in the total balance. Management has not given any explanation or reconciliation for the omission,” reads the report.
The fund is also on the spot over non-performing loans, unauthorised expenditures and other expenses worth millions of shillings. The report also says the fund has non-performing loans of Sh71 million from eight financial partners.