Nairobi News


REVEALED: How Kidero’s team transacted Sh21 billion in ‘secret’ accounts

An audit report has revealed shocking details the regime of former Nairobi Governor Evans Kidero  operated 13 undeclared bank accounts leading to over Sh21 billion being unaccounted for.

Dr Kidero’s administration ran 32 bank accounts in commercial banks, contrary to the Public Finance Management Act that requires county governments to open accounts at the Central Bank of Kenyan except for an imprest bank account.

The forensic report by KPMG said that 13 of the 32 commercial bank accounts were not declared during the handover report.

Further, five of the 13 accounts had approximately Sh120 million as at August 31, 2017 and its signatories included past county officers.

The report was handed over to Governor Mike Sonko on Wednesday.


“Approximately Sh21 billion in payment made through these banks were not processed in IFMIS and the county did not maintain adequate accounting records to facilitate scrutiny of the related transactions,” read the report.

The report was compiled by KPMG Head of Advisory East Africa Gerald Kasimu and Head of Risk and Management Consulting Brian D’Souza.

It further revealed that majority of cash books of the last county government were maintained manually, making it impossible to obtain a trial balance or central view of the county financial position.

According to the report, City Hall used five different financial systems to manage its operation during the period July 1, 2011 to June 30, 2017.

They included, e-Jijipay, which is an e-payment platform, Laifoms- a revenue receipting systems, IFMIS- Integrated Financial Management Information System hosted by the National Treasury, IPPD- Integrated Payroll and Personnel Database for staff records and payroll and Jumbo Link- an online Cooperative Bank of Kenya link for making payments.

KPMG indicated that the integration of all these financial systems was not automated and in most cases manual interventions were utilized to move data from one system to another.

The review identified 7,346 cash collection booklets issued to revenue collection attendants that were subsequently deleted from Laifom, the county revenue receipting system.


“There was no evidence provided to demonstrate that cash collected by the attendants using the 7,366 booklets was surrender to the county treasury,” said Kasimu.

The audit report faulted the handover report, which had stated the county had liabilities amounting to Sh56 billion as at June 30, 2017, indicating that the handover report did not include all the commitment and liabilities with some of the transactions included in the pending bills not supported.

“County officers could not provide supporting documents for 14 transactions amounting to Sh1.1 billion out of a sample of 60 transactions,” said the KPMG report.

The report also found that the county had 161,393 properties registered for collection of land rates which were predominantly charged rates based on site value of the property last updated in 1982.

“County officers could not provide a full supporting evidence relating to adjustment to land rate revenue amounting to Sh407 million for a sample of 19 rates adjustment included in our review,” said Kasimu.

Mr Kasimu said the County did not maintain complete and accurate asset register, for example, inconsistencies were noted between the handover report and asset listing provided by the county officer.