Auditor General reveals suspicious spending at mining ministry

An audit has flagged expenditure of over Sh759 million at the State Department for Mining pointing to a potential loss of taxpayers’ money.

The latest Auditor-General’s report on government ministries, departments and agencies for the period 2023-24 shows what the auditor says are irregularities in procurement of goods and services, unsupported payments, use of invalid Local Purchase Orders (LPOs) and unaccounted for cash.

Among the queries is accuracy in receipts and payments on goods and services amounting to Sh590.2 million, where several entries were debited in the ledger and later reversed without any supporting documents such as journal entries, approval for the reversals and particulars indicating the nature of the errors corrected.

This has seen the auditor general question the accuracy and completeness of the use of the goods and services that could not be confirmed.

The State Department also paid bills worth Sh3.9 million but was not supported with relevant documentation such as invoices, contracts, delivery notes and inspection reports.

In general, the accuracy and completeness of pending accounts payable balance of Sh169.3 million could not be confirmed, according to the Nancy Gathungu-led audit office.

The report has also flagged irregularities in procurement of goods and services where during the year under review, payments totalling Sh56.5 million were made in respect of various goods before inspection and acceptance.

“This was contrary to Section 48 of the Public Procurement and Asset Disposal Act, 2015 which provides inter alia that an Inspection and Acceptance Committee shall immediately after the delivery of the goods, works or services; inspect and where necessary, test the goods received in order to ensure compliance with the terms and specifications of the contract,” Gathungu says in the report.

“In the circumstances, management was in breach of the law.” The statement of receipts and disbursements reflects property income of Sh3.3 billion including mining royalties amounting to Sh257.3 million.