The CFAA had two key objectives, firstlyto facilitate a common understanding by the Government ofKenya and development partners of the country'sfinancial management arrangements in both the public andprivate sectors, identifying areas for improvement andreaching agreement amongst key stakeholders on how to takethis forward. Secondly, to identify areas whereaccountability arrangements need to be strengthened and therisks that these may pose in relation to the use of publicfunds. Kenya's system of financial management in thepublic sector has some strengths, notably a sound code offinancial regulations, the existence of a core of skilledtop level managers, an updated budget framework, thecomputerization of a number of financial accountabilityfunctions as well as the powers and autonomy of theController and Auditor General (C&AG) rooted in theConstitution. In the private sector, the accountancyprofession is well established and the Government hascreated an enabling environment for financial accountabilitythrough a solid legal framework. Nevertheless, the fiduciaryrisk in public spending is assessed as high. While a lack ofcompliance with established financial and procurementregulations have completely rendered many initiatives aimedat strengthening the control environment ineffective, issuesof limited execution, inadequate monitoring, insufficientcapacity and lack of enforcement also need to be resolved.The country's financial accountability framework, andtherefore financial management, would be considerably moreeffective and the associated fiduciary risk mitigated, ifthese areas were strengthened. Consequently, it is envisagedthat any kind of adjustment or programmatic lending in theimmediate future would have to go hand in hand withsignificant improvements in public sector financial management.
PDF
download
878987797
028-85220240
