Part II – CORPORATE MANAGEMENT · PFM Regulations

17Corporate governance

(1) Every national government entity to which the Act and these Regulations apply shall include in their annual financial report as provided in section 81 of the Act, a statement by each entity's Accounting Officer on compliance of the entity with these Regulations under this part.

(2) Where the entity is not fully compliant with these Regulations, the Accounting Officer of that entity shall identify the reasons for non-compliance and indicate the steps being taken to become compliant.

(3) The statements made in the report under this regulation shall be submitted to the Cabinet Secretary.

18Establishment of Public Finance Management Standing Committees

(1) There is established in every national government entity a committee to be known as the Public Finance Management Standing Committee (hereinafter referred to as the "Standing Committee) to provide strategic guidance to the entity on public finance management matters.

(2) Each standing committee shall comprise of the following—

(a) the Accounting Officer as chairperson of the Standing Committee;
(b) an officer designated by the Accounting Officer as secretary of the Standing Committee and who shall be either the head of the finance or accounts units or head of both finance and accounts units of the entity; and
(c) heads of departments or administrative units dealing with public finance management matters.

(3) The Standing Committee shall meet as often as is necessary but at least once every quarter so as to coordinate management of public finance for entities and shall be accountable to the Cabinet Secretary responsible for the entity or in case of Parliament, Judiciary, Independent Offices and Commissions, to the head of that entity.

(4) The Standing Committee may establish sub-committees for the better carrying out of its roles and responsibilities under this regulation.

19Roles and responsibilities of the standing committee

(1) The Standing Committee shall generally be responsible for the following—

(a) ensuring that there is prioritization on resources allocated to a national government entity for the smooth implementation of the entities mission, strategy, goals, risk policy plans and objectives;
(b) regularly reviewing, monitoring budget implementation and advice on the entities accounts, major capital expenditures and reviewing performance and strategies at least on a quarterly basis;
(c) identifying risks and implementation of appropriate measures to manage such risks or anticipated changes impacting on the entity;
(d) reviewing on a regular basis the adequacy and integrity of the entity's internal control, acquisition and divestitures and management information systems including compliance with applicable laws, regulations, rules and guidelines;
(e) establishing and implementing a system that provides necessary information to the stakeholders including stakeholder communication policy for the entity in line with Article 35 of the Constitution;
(f) monitoring the effectiveness of the corporate governance practices under which the entity operates and propose revisions as may be required, from time to time;
(g) monitoring timely resolution of audit issues; and
(h) any other matter referred to it from time to time by the responsible Cabinet Secretary or in the case of Parliament, Judiciary, independent office and commissions, the head of that entity.

(2) The Standing Committee shall submit a quarterly report of its work including any recommendations to the responsible Cabinet Secretary or in case of Parliament, Judiciary, Independent Offices and Commissions, to the head of that entity.

20Duties and responsibilities of the office of the Accountant-General

The Accountant-General Department shall be responsible for—

(a) advising the national government on accounting and reporting matters;

(b) overseeing the implementation of the approved government accounting standards;

(d) providing advice to national government on the best and appropriate financial reporting formats;

(e) providing link between local and international accounting standards bodies on matters relating to public sector financial reporting;

(f) developing guidelines for accounting staffing levels and training to ensure technical competence and knowledge of financial accounting and reporting, advising on accounting and financial matters;

(g) overseeing the implementation of the approved government accounting standards, policies, bases and concepts;

(h) advising governments on cash and treasury management;

(i) administering the Consolidated, Equalization and Contingencies Funds;

(j) advising the Public Accounts Committee of Parliament on accounting matters;

(k) administering the Scheme of Service for Accountants; and

(l) policy development and research.

21Presidential warrants

(1) Once the Annual Appropriation Bill or Supplementary Bill has been assented to, the Cabinet Secretary shall obtain presidential warrants authorizing issues from the Consolidated Fund in accordance with the respective Appropriation Acts.

(2) The Presidential Warrants in paragraph (1) of this regulation shall be transmitted to the Controller of Budget by the Cabinet Secretary to authorize withdrawals in accordance with Article 228 of the Constitution.

22National Treasury warrant

On receipt of the Presidential warrant, the Cabinet Secretary shall issue a National Treasury warrant granting authority to Accounting Officers to incur expenditure for the year in respect of their votes.

23Responsibilities of Accounting Officers

(1) Accounting Officers shall in accordance with Article 226(2) of the Constitution and section 68(1) of the Act, be accountable to the National Assembly—

(a) for management of their departments public finances, including whether sufficient resources have been allocated to a particular program;
(b) for ensuring the most effective means of achieving desired program outcomes are used;
(c) for maintaining effective systems of internal control and the measures taken to ensure that they are effective; and
(d) for measures taken to prepare the financial reports that reflect a true and fair financial position of the entity;
(e) for implementation of the recommendations of Parliament arising from the reports by the Auditor-General and the Controller of Budget.

(2) In addition to the responsibilities of Accounting Officers provided for in the Act, an Accounting Officer designated under the Constitution, the Act or any other Act, shall—

(a) comply with any tax, levy, duty, pension, commitments and audit commitments as may be provided for by legislation;
(b) where he or she reasonably believes that an unauthorized, or irregular expenditure has occurred, immediately report, in writing, particulars of the expenditure to the relevant authority with a copy to the National Treasury; or
(c) before transferring any funds to an entity within or outside government, ensure that there is a written assurance from the entity that it shall implement effective, efficient and transparent financial management and internal control systems, or, if such written assurance is not or cannot be given, render the transfer of the funds subject to conditions and remedial measures requiring the entity to establish and implement effective, efficient and transparent financial management and internal control systems;
(d) enforce compliance with any prescribed conditions if the respective government entity gives financial assistance to any other entity or person in accordance with the law;
(e) take into account all relevant financial considerations, including issues of propriety, regularity and value for money, where policy proposals affecting the Accounting Officer's responsibilities are considered, and where necessary, bring those considerations to the attention of the relevant authority;
(f) promptly consult and seek the prior views of the National Treasury on economic viability and financial implications on any new entity which a state department, or state organ intends to establish or in the establishment of which it took the initiative;
(g) not commit national government entities to any liability for which money has not been appropriated provided that expenditure for projects or programs implemented beyond one financial year is provided for in the subsequent financial years; and
(h) comply, and ensure compliance by national government entities with the provisions of the Act and these Regulations.

24Delegation by the Accounting Officer

(1) The Accounting Officer of a national government entity may delegate to a public officer, in writing, any of the Accounting Officer's powers or functions under the Act or these Regulations.

(2) In exercising powers and functions under a delegation, the public officer shall comply with any lawful directions of the Accounting Officer.

(3) The delegation in this regulation may include the authority to incur expenditure in accordance with any limits prescribed by the Accounting Officer.

(4) Delegation of power does not take away the responsibility of the accountability from the Accounting Officer.

25Designation of public officers as AIE Holder

(1) An accounting officer may authorize a public officer under their national government entity to be an Authority to Incur Expenditure (AIE) Holder.

(2) An Accounting Officer who finds it necessary to authorize a public officer in another Ministry or county government to incur official expenditure on his or her behalf, shall do so by issuing an Authority to Incur Expenditure addressed to the Accounting Officer of the national government or county government entity.

(3) The designation of AIE Holder shall be in writing in the form prescribed by the National Treasury

(4) An Accounting Officer shall maintain a register of all AIE Holders designated under the Act.

(5) Where an Accounting Officer delegates this authority, the accounting officer shall remain responsible for any expenditure incurred as a result of that delegation.

PFM Regulations

Part II – CORPORATE MANAGEMENT