At the risk of attracting negative traction, I pose and explore the question, is the Sh 5bn Health story, a case of massive theft or deep misunderstanding of the Audit process as informed by an incomplete audit document?
A dangerous trend is emerging, we have a new kind of journalist thirsty for an exclusive story; a story with the stink of scandal. Splash material.
As a result, there is a new conveyor belt, a silent auditor, willing to share his thoughts and conclusions as fact for the largely impatient journalist to whom truth does not matter, after all, he/she has a document to prove grand corruption and ‘massive theft” of taxpayers’ money.
Under those circumstances, an unacceptable environment of professional misconduct and deliberate expert distortion of truth unites with the highest and acceptable journalistic privilege of anonymous sources.
A dated letter, with a ministry letterhead and signatures quickly becomes fodder treated as a major scoop and presented as yet another scandal.
I spent time this morning to speak to three auditors and all I wanted to understand is what is a DRAFT INTERNAL AUDITOR REPORT.
The type that now informs the alleged Shillings 5b theft of public funds at Afya House – The Ministry of Health headquarters.
Simple answers, but the conclusion was that an Internal Audit Report is basically a four step process comprising of:
1. What is wrong?
Disclosure of findings and processes involved in arriving at such finding; Why is it wrong?
2. Description of findings-the root cause analysis. How to correct it?
3. Recommendations and Suggestions. What will be done?
4. Auditee’s views and comments
Those four steps make up what is then called an Internal Audit Report.
At the very least an audit report should allow time for management response to the questions prepared by the internal auditor, before that those are just the thoughts of a professional that cannot be picked by the media and described as a major scandal.
An auditor who leaks such a letter, fails his profession and largely misinforms a nation.
In Journalism class we were taught that a person who leaks a story has an underlying objective, good journalists question the motive and seek a different interpretation of leaked materials. In this case interviewing respected audit firms like Deloitte or KPMG would have helped point out the expert fraud being presented as a whistleblower effort.
The process of an internal audit involves research after which a first draft is forwarded for auditee remarks, after which changes if any are made and then an exit meeting is planned and a final report compiled pointing out structural weaknesses for improvement and also enclosing recommendations and suggestions on the way forward.
Internal audits should strengthen an organization, offload it of systems that weaken it and importantly tighten its financial systems by pointing out loss of funds if any.
An internal audit that does not have the auditee response or recommendations of the auditor cannot be termed as a report, it can only be working notes of an auditor.
We must fight corruption and point it out, but we must also not shout fire where it does not exist.
When a draft report says clinics were not seen, yet they exist and are stored in the open in a GOK institution, then you notice how vulnerable our media is to narratives whose purpose is not to expose corruption but settle other issues.
Internal auditors in Kenyan ministries are employees of Treasury, their job is to instantly spot misuse or embezzlement of funds on a continuous basis.
The constitution on its part introduced the Independent office of an Auditor General who has yet to audit the funds in questions and give a report that is tabled in parliament.
At what point can audit be said to expose grand corruption? Surely not at the first stage of auditor questions, the questions are not an indication of graft, but a procedural staircase demanding answers that then inform a Draft Audit Report, that is subjected to an exit meeting and eventually a Final report.
If internal draft audit reports will inform our corruption coverage we will end up with a distorted view of ministry and government operations.
Even beyond audit reports and our overall understanding of the process, there are other tests to employ before screaming scandal, what is the overall budget of the programme/s at hand? If 70% of project funds are embezzled can it continue?
Can it be sustained? If the answer is no, then the journalistic test is simple was the project implemented and are there independent reports showing it was a success?
The Maternity programme is definitely a success praised by no less a body than the United Nations and many other organizations worldwide.
Beyond the praise, maternal deaths have gone down, more mothers are giving birth in hospitals, NHIF has increased cover to cater for expectant mothers – the evidence suggests success of the programme, yet 75% of the funds were embezzled?
Such tests help to test our stories as fact or fiction in my opinion.
That said, if the final audit and the audit by the Auditor General is confirmed by the processes provided for by law, then the independent commissions owe Kenyans an answer – but it would be wrong to crucify a ministry on the basis of a thought process of an auditor that was leaked before it became a report.
Let us zoom the cameras at those dipping their hands illegally into the public till, because they exist, but let us also not accuse those who do so legally by focusing on incomplete leaked documents.
The views expressed in this article are entirely my personal thoughts and do not represent State House, The Presidency or the Government of Kenya