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EACC Tells Counties To Streamline Internal Audit, Asset Management Loopholes Aiding Graft

Ethics and Anti-Corruption Commission (EACC) CEO Twalib Mbarak has directed county governments to develop and operationalize systems and procedures to streamline integrity and transparency in assets management at the devolved level.

Mbarak in a letter dated August 29 addressed to all county governors and speakers of county assemblies said corruption was still rampant in the counties.

It came after EACC carried out Corruption Risk Assessments at various devolved regions and identified 10 major loopholes in the management of assets at the county level.

The loopholes include policies and guidelines on asset management not being properly developed in counties, assets not being uniquely tagged and coded for ease of identification and accountability, the registration of assets in the names of defunct local authorities and counties not having inventory management systems.

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Asset Disposal Committees not being constituted in counties, failure to provide security for the assets, insurance fraud, mechanical defects inspections not being undertaken, and failure by counties to undertake asset valuations were also listed.

“The purpose of this advisory is to bring to your attention the above concerns and malpractices which are rampant in the administration of asset management.”

“The Commission hereby requires the County Government (Executive and Assembly) to streamline integrity and transparency in assets management. This is to be done in line with the relevant provisions of the Constitution,” said Mbarak.

“The County Government is required to submit an implementation plan for addressing the above malpractices through the establishment, maintaining and documenting adequate asset management structures, including an Asset and Liability Management Unit and a Standing Committee on Assets and Liabilities Management, utilization of ICT-based information systems for the purposes of managing assets; and preparation of Assets Registers based on the issued templates.”

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Mbarak also instructed all county governments to submit an implementation plan for addressing challenges relating to the establishment and operationalization of the internal audit function in the Public Finance Management Act 2012 while telling the county leaders to provide updates, on a quarterly basis to the Commission on the progress made to implement the plans.

This was informed by the fact that EACC assessments had revealed inadequacies in the operation of internal audit functions in both the County Executives and Assemblies.

“Policies and Procedure Manuals to guide internal audit processes have not been developed. The failure to constitute and operationalize Internal Audit Committees are some of the weaknesses identified,” said Mbarak.

Audit committees not holding meetings regularly as required by law, accounting officers failing to implement internal audit recommendations, internal audit units not undertaking risk-based audits and county governments inadequately facilitating internal audit units were also identified as inadequacies  during the EACC assessments.

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