NAIROBI, Kenya – Kenya’s Integrated Financial Management Information System (IFMIS), designed to enhance transparency and accountability in public spending, has failed to deliver on its core objectives and has instead enabled irregular expenditure and loss of public funds, Auditor General Nancy Gathungu has revealed.
In her 2023/24 audit report on the national government, Gathungu cited critical flaws within the IFMIS system, including weak internal controls and data inconsistencies, which she says have undermined its effectiveness and facilitated spending outside the law.
“The benefits expected from the deployment of IFMIS have not been realised due to inadequacies of the system,” the report states.
A review of IFMIS transactions found that some were cancelled without proper documentation or authorisation.
In other cases, payments were either missing from official financial statements or recorded in IFMIS without corresponding ledger entries, raising red flags about the accuracy and reliability of public financial records.
One particularly concerning case involved the creation of an account in IFMIS under an individual’s name, which led to the loss of funds—evidence, the report noted, of internal control overrides and poor oversight.
The Auditor General also highlighted discrepancies between balances in financial statements and supporting schedules generated by IFMIS, further questioning the system’s reliability.
In addition to system failures, Gathungu flagged unconstitutional government spending amounting to Sh10.2 billion, incurred without the necessary approval from the National Assembly as required under Article 223 of the Constitution.
This figure includes:
- Sh4 billion spent on the maize flour subsidy programme
- Sh6.2 billion used for the acquisition of Telkom Kenya shares
“There are no guidelines in place on how unapproved withdrawals from the Consolidated Fund under Article 223 should be dealt with,” the Auditor General said.
She called for urgent amendments to the Public Finance Management Act, 2012, to establish a clear legal framework for managing expenditures made under Article 223 that fail to secure parliamentary approval.
“The law must define the steps to be taken when such expenditures are not approved by the National Assembly,” Gathungu urged.
Her report adds to growing scrutiny of public financial management systems, amid mounting concerns over accountability gaps and persistent misuse of funds across national and county governments.
It follows a string of audit revelations, including Sh304 billion in unused funds across key government projects and over Sh600 million paid to undocumented law firms by the Tana River County government without proper legal oversight.
