The Auditor General has identified serious asset management deficiencies across 26 government ministries, departments, and agencies, with inaccurate and incomplete fixed asset registers totalling Ksh413.2 billion.

In her 2023/2024 financial year report, Auditor General Gathungu highlighted widespread problems, including missing school asset registers, unknown vehicle values, and absent critical information such as land descriptions, locations, fair values, acquisition dates, and ownership documents.

Major challenges

These deficiencies pose significant challenges as Kenya transitions from cash to accrual accounting.

The National Treasury mandated all government entities, including in counties, to adopt IPSAS Accrual-based standards from July 1, 2024, requiring comprehensive asset identification and proper valuation using government valuers.

“The accounting officers should therefore undertake an inventory of all assets, establish the cost or values of the assets using a government valuer and confirm whether all assets are recorded in the assets register to ensure assets are properly recognised, disclosed and accounted for in the financial statement,” the report says.

Key findings

The State Department for Basic Education showed the most severe gaps, with public secondary schools lacking asset registers worth Ksh6.6 billion.

The Department for Economic Planning’s Ksh1.4 billion register remained outdated, with most assets unvalued.

Medical Services reported Ksh9.5 billion in fixed assets but showed nil land balance, while Public Health and Professional Standards failed to properly document 14 motor vehicles and ICT equipment, despite holding three land title deeds of undetermined value and excluding ministry headquarters buildings.

Unmapped assets

The Irrigation Department’s Ksh1.1 billion register omitted 13 vehicles, contained zero or unknown asset values, and couldn’t upload data to Treasury systems due to unmapped assets.

Notably, two Toyota Prado vehicles were incorrectly recorded as one vehicle with dual registration numbers.

Energy Department’s massive Ksh322.1 billion register lacked proper asset tagging and serial numbers, while Lands and Physical Planning’s Ksh6.7 billion register omitted essential details, including asset names, acquisition dates, costs, locations, and current status.

Disposed vehicles

The Judiciary excluded 26 disposed vehicles from its Ksh31.7 billion register without reflecting the disposals in summaries.

The Public Service Department failed to include assets from Huduma Kenya headquarters, with 17 centres maintaining no registers and 14 others keeping incomplete records.

The Auditor General directed all accounting officers to conduct comprehensive asset inventories, establish proper valuations through government valuers, and ensure complete asset register updates to meet new accounting standards and enable proper financial reporting..