Auditor General raises red flag on NSSF transactions

Workers who contribute to the National Social Security Fund, NSSF, are staring at losing over 113 million shillings from the sale of undeveloped land in Mavoko, more than five years after the transaction.

This has prompted the Auditor General to raise questions as to why NSSF was paid 10 percent for the land in August 2011 with the remaining amount that was to be paid within three months, yet to be paid more than five years later.

Auditor General Edward Ouko questioned why NSSF failed to terminate the deal after the expiry of the three months execution period.

This among other issues have seen Ouko raise concerns on NSSF’s financial dealing for the year ended 30th June 2016 and issued a qualified opinion suggesting audit information provided was limited in scope and the state-run pension scheme may have failed to adhere to the generally agreed accounting principles.

In addition, NSSF failed to offer documentation for rent accrued from its property in Kisumu.

He says despite NSSF’s eight apartments and three maissonettes at Milimani Estate in Kisumu being fully occupied, with the Fund offering security and other services, there was no document provided to show that rent was being received.

The auditor further says NSSF is yet to collect 239.5 million shillings in rent from the Hazina Plaza property in Mombasa since 1994.

Ouko says NSSF has not realized value for money from the 450 million shillings Hazina Plaza investment since 1994 nor has the fund exercised prudent financial management of the contract.

NSSF also faces the challenge of collecting contributions with some employers failing to remit deductions.

The Auditor General says an examination of 20 sampled employer files maintained in nine NSSF branches indicate that contributions totaling 754.99 million shillings had not been remitted in the stipulated period. Ouko advised NSSF to send demand letters to all employers who have defaulted in remitting deductions.

 

  

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