Treasury’s financial management system works

By Peninah Nyawira

Kenya: Lately, there has been a lot of criticism directed at the National Treasury over financial issues arising from the county governments and how they have spent their finances. Unfortunately, the criticism has been based on lack of understanding of the new financial management system.

The National Treasury has managed to deliver money to the counties from inception to the supplementary budgets through the Integrated Financial Management Information System (Ifmis), which is at the centre of criticism.

Let’s think of Ifmis as the umbilical cord that ensures the county governments prepare their budgets and present them to the county assemblies on time. These budgets are also received on time from the national government to ensure timely development.

Any system is only as good as its users. What the Ifmis users at the national and county governments feed into the system is what it works with, and what auditors use at the end of the financial year. Ifmis ensures that what the county governments have budgeted for is spent for the intended purpose.

If Makueni County, for example, budgets for a latrine, it can only spend that amount. The funds cannot be diverted to build, say, a hospital or market shed. Budget changes can only be authorised by the county assemblies, thus offering a safety valve to avoid arbitrary tweaking of numbers. 

We need to look at both sides of the Ifmis coin to appreciate its critical role. For starters, it has resulted in accountability, which had been elusive for many years. The office of the Auditor General must take the audit process a step higher by identifying the queries based on the specific counties in question.

Interestingly, all this can be done through the Ifmis system, which has an audit trail that enables the Auditor General to access the users who created the budget in a particular county and those who issued payment.

The Auditor General can then track the payment and clarify the issue with the relevant officials at their level. Ifmis will evolve to meet emerging needs and challenges, but so far it has managed to surpass expectations. Even ICT giants like Microsoft and Apple, have to consistently upgrade and improve their software and systems to address emerging needs.

Most recently, the National Treasury used Ifmis to automate Government LSOs and LPOs. Suppliers working with the Government will no longer receive printed  supply and purchase orders. Instead these will be issued through the Ifmis system. This is not to say it is perfect, but we are ready to take responsibility if it falls within our realm.

Let us give credit where it is due and place blame in the right place.  Maybe those people discrediting Ifmis have hidden interests. 

The writer is a communications consultant specialising on devolution and governance.