Concerns over irregular expenditure in government
By Mercy Mwai, July 26, 2025Auditor General Nancy Gathungu has cast doubt on the future sustainability of the Postal Corporation of Kenya (PCK), citing severe financial distress and governance failures in her audit report for the financial year ending June 30, 2024.
According to the report, the corporation is operating with a negative working capital of Ksh7.7 billion, raising serious concerns about its ability to continue as a going concern.
“The conditions indicate the existence of a material uncertainty, which may cast significant doubt on the Corporation’s ability to continue operating,” the report reads.
The Auditor General notes that while the corporation recorded current assets of Ksh1.8 billion, it also held current liabilities amounting to Ksh9.5 billion, leading to the massive capital shortfall.
Furthermore, the report reveals that PCK posted a net operating deficit of Ksh1.08 billion during the period under review, increasing its already negative general reserves from Ksh6.23 billion in 2023 to Ksh7.32 billion in 2024.
Despite these alarming figures, Gathungu notes that the management failed to disclose any concrete mitigation measures in the notes to the financial statements.
“The financial statements have been prepared on the assumption that the Corporation will continue receiving financial support from the Government, bankers, creditors and other stakeholders,” Gathungu says.