Moi University Under Financial Scrutiny as MPs Order Forensic Audit

Moi University Under Financial Scrutiny as MPs Order Forensic Audit.

In response to the dire financial situation at Moi University, Parliament has instructed Auditor-General Nancy Gathungu to perform a forensic audit of the institution’s finances.

The audit is intended to determine the root causes of the university’s financial crisis. The Cabinet Secretary for Education, Julius Ogamba, informed the National Assembly’s Public Investment Committee on Education that Moi University has accumulated certified outstanding bills amounting to Sh8 billion.

Dr. Ogamba emphasized the need for a thorough forensic audit to help the government understand the financial mismanagement at the institution. He mentioned that such a review could prevent the university from sinking deeper into debt.

Parliamentary Committee Orders Forensic Audit

Bumula MP Jack Wamboka, chair of the Public Investment Committee, directed the Auditor-General to audit the university’s finances over the last five years.

The committee demanded a comprehensive report within 60 days. This audit was prompted by revelations that Moi University failed to remit Sh4 billion in payroll deductions, repay a Sh3 billion loan to Rivatex East Africa Limited, and clear Sh1.1 billion in outstanding bills as of June 2020.

These issues were highlighted in the financial report for the fiscal year ending in June 2020.

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In the interim, Mr. Wamboka announced that all new projects at Moi University would be frozen and that no new staff could be recruited until the audit was completed.

The committee also instructed the Public Service Commission (PSC) to assume responsibility for downsizing the university’s overstaffed workforce of more than 4,000 employees.

Previously, Moi University had engaged PKF Consulting LLP for this task, but the PSC was now directed to take over.

Additionally, the PSC was asked to provide an updated report on all staff currently in acting positions at the university.

Moi University’s Financial Crisis

Moi University Vice-Chancellor Professor Henry Kosgey, former Vice-Chancellors Professor Laban Ayiro and Professor Richard Mibey, and Council Chairman Dr. Humphrey Kimani attended the meeting to discuss the university’s finances.

Dr. Ogamba expressed concerns about the financial troubles, noting that other institutions such as the Technical University of Kenya (TUK) and Taita Taveta University are also struggling with similar issues.

He supported the forensic audit and highlighted Moi University’s certified pending bills of Sh8 billion.

Dr. Ogamba urged the government to take decisive actions to prevent further deterioration of the institution’s financial health. He also called for interim measures to allow students to resume classes while the audit was conducted.

Strikes and Salary Disputes

Moi University has been shut down since last Friday, following a month-long strike by lecturers and staff over unpaid salaries and unresolved issues dating back to the 2013 Collective Bargaining Agreement (CBA).

The university also failed to remit statutory and third-party deductions such as loans, sacco contributions, and welfare payments.

The committee ordered Treasury Cabinet Secretary John Mbadi to release Moi University’s capitation funds immediately. Mr. Mbadi was also summoned to appear before the committee on Tuesday to provide an update on compliance with this directive.

Council Chairman Dr. Kimani informed the committee that Moi University owes Sh4 billion in unremitted pension payments. He explained that the institution had only received Sh97 million in government capitation, far short of its Sh403 million monthly salary bill.

The discontinuation of the university’s parallel program, which previously generated Sh4 billion annually, contributed to these financial challenges.

Shortfall in Revenue

Higher Education Principal Secretary Beatrice Inyangala noted that although Moi University projected revenues of Sh5.1 billion, its actual expenditures reached Sh7 billion.

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She stated that they had requested an additional Sh1.5 billion from the Treasury but acknowledged that the university would still face a deficit of Sh400 million. Dr. Inyangala urged Moi University to find ways to cover this shortfall.

Moi University Under Financial Scrutiny as MPs Order Forensic Audit.

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