Co-operatives and MSMEs Development Cabinet Secretary Wycliffe Oparanya has announced new measures aimed at tightening accountability in the auditing of SACCO financial statements.
Speaking on Thursday, September 25, Oparanya directed the SACCO Societies Regulatory Authority (SASRA) and the Commissioner of Co-operatives to enforce stricter oversight in the preparation and auditing of SACCO accounts.
First, Oparanya instructed that internal auditors must render their opinions on financial statements before the documents are submitted for external auditing.
This, he said, will ensure a stronger internal control mechanism and safeguard against errors or misstatements at an early stage.
"Ensure that internal auditors of SACCOs render their opinions on the financial statements and reports, prior to such financial statements being subjected to external auditing," he said.
Read More
Oparanya also ordered SASRA and the Commissioner to take firm action against external auditors who fail to provide services in line with the SACCO Societies Act and its regulations.
"Institute appropriate actions against external auditors who internally fail to render external auditing services in accordance with the SACCO Societies Act and Regulations, including referral of such external auditors to ICPAK for additional sanctions," he added.
In addition, Oparanya directed that all financial reports and statements be countersigned by the Chief Executive Officers and Finance Officers who prepare them, alongside the Board of Directors.
This, he said, is intended to hold both management and directors equally accountable for the disclosures in SACCO financial reports.
"Ensure that all financial reports and statements are countersigned by the Chief Executive Officers and Finance Officers who prepared them, in addition to the Board of Directors. This will hold both management and the Board of Directors responsible for the disclosures in the statements," he further said.
This comes months after SASRA called on SACCOs across the country to be vigilant over cybersecurity breaches and attacks.
In a statement on Thursday, April 17, the authority noted that the attacks, which target the SACCOs holding money contributed by Kenyans, happen during long holidays such as the Easter weekend.
According to SASRA, the attacks most likely happen 12 hours before the holidays or in the last hours of the holiday.
Therefore, the saccos were encouraged to consistently monitor their systems to ensure that there are no breaches.
"Consequently, all Regulated SACCOs are hereby called upon to heighten, intensify and strengthen the cyber-security monitoring and surveillance over their Management Information Systems (MIS), Digital Financial delivery channels, and other ICT infrastructures used to provide financial services to members in order to detect and prevent any potential cyber-attacks or breaches during the Easter Holidays Weekend," the statement read.
According to SASRA, criminals often attack institutions offering financial services to steal sensitive data of customers.
In other cases, criminals can also wipe out savings that have been made by Kenyans in the financial institutions.
"Regulated SACCOs and their third-party system vendors and integrators (where applicable) must institute round-the-clock internal control measures to detect and prevent insiders (employees) from colluding with third parties committing such cyber-attacks and breaches.
"Special attention should be given to activities related to the electronic and/or digital linkages of mobile phone numbers to funds held in mobile money wallets and/or mobile money float accounts and/or mobile money pay-bills and/or any other settlement accounts," the statement added.
