A professional accounting body has sounded a warning over poor management of finance resources in counties and other government departments.
The Institute of Certified Accountants of Kenya (ICPAK) has cited declining revenue collection and accumulated pending bills as a serious threat to liquidity in devolved units and called for immediate measures to the trend.
ICPAK chairman Julius Mwatu, while addressing the press in Machakos on Friday said reports by the auditor general suggest ‘a dangerous trend’ which, if not urgently addressed could collapse many counties.
“We are greatly concerned about the dangerous trend of pending bills which is an indicator of lack of prudence in public finance management. There has been a trend of reckless expenditures in awarding of contracts and local purchase orders (LPOs) without consideration of funds availability,” Mwatu said.
He said own-source revenue figures had also been in decline mode-literally, in all counties apart from Nairobi which reported significant growth in revenue collection in the past one year.
“The cumulative revenue raised by the county governments amounted to Sh32 billion which translates to 52 percent of the local annual revenue target,” he said.
“The national treasury should issue without further delay the public procurement and disposal regulations to effectively operationalize public procurement,” Mwatu added.
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