Audit Committee Faults Maritime Authority Over Unauthorised Accounts and Audit Lapses

 The National Assembly Special Funds Accounts Committee has raised serious concerns over financial management practices at the Kenya Maritime Authority (KMA), citing the operation of unauthorised bank accounts and persistent audit lapses.

The Committee, chaired by Fatuma Zainab, made the findings during a session with KMA officials to review audited accounts for the Authority’s Staff Mortgage and Car Loan Scheme. The review covered financial years spanning 2013/2014 to 2024/2025.

According to the Office of the Auditor-General (Mombasa Region), the scheme had been operating four bank accounts without approval from the National Treasury, in violation of Section 28(1) of the Public Finance Management Act, 2012. The law requires all national government entities to obtain Treasury approval before opening or operating bank accounts.

Appearing before the Committee, KMA Director General Omae Nyarandi acknowledged the issue and stated that the Authority had sought approval through a letter dated December 13, 2024. However, lawmakers noted that the request came years after the accounts had already been in operation.

Chairperson Fatuma Zainab emphasized that retrospective approval does not excuse prior non-compliance, noting that the Authority had failed to adhere to established financial regulations.

The Committee also flagged delays in the submission of financial statements and failure to comply with reporting guidelines. Members questioned why such lapses persisted despite the availability of modern financial reporting systems.

Erastus Kivasu criticized the recurring delays, stating that timely submission of financial statements should be routine and efficiently handled through digital systems.

In response, Nyarandi admitted that the loan scheme had initially been managed under KMA’s main accounts, describing the arrangement as irregular. He added that the Authority has since separated the scheme’s accounts and taken steps to address the audit concerns.

The Committee is expected to compile a report with recommendations, which will be tabled before Parliament for further action.