Technical, legal and financial

Audits report for Water and

Sanitation Service
Improvement Project
Additional Finance (WaSSIPAF) for the period ended 30
September 2015

Final Report

WASSIP-AF FINAL AUDIT REPORT

Table of Contents
1 EXECUTIVE SUMMARY

1.1
1.2
1.3
1.4
1.5

3
3
4
4
4

INTRODUCTION
OUR APPROACH AND METHODOLOGY
OPPORTUNITIES TO IMPROVE
CONCLUSION AND NEXT STEPS
CONFIDENTIALITY

2 INTRODUCTION AND OBJECTIVE OF THE ASSIGNMENT

2.1
2.2
2.3
2.4

6
7
7
9

ABOUT WASSIP-AF
WASSIP-AF FUNDING SUMMARY
OBJECTIVES AND SCOPE OF THE ASSIGNMENT
EXPECTED DELIVERABLES

3 OUR APPROACH AND METHODOLOGY

10

4 FINDINGS AND RECOMMENDATIONS FINANCIAL AUDIT

12

4.1.1 SCOPE OF PROCUREMENT REVIEW

4.1.2 FINDS AND RECOMMENDATIONS PROCUREMENT REVIEW
4.1.3 FINDINGS AND RECOMMENDATIONS FINANCIAL AUDIT

12
13
23

5 FINDINGS AND RECOMMENDATIONS TECHNICAL AUDIT

25

5.1 CONSTRUCTION OF COMMUNITY WATER SUPPLY DOWNSTREAM OF THIKA DAM (GATANGA

WATER SUPPLY)
25
5.1.1 PROJECT SUMMARY
25
5.1.2 FINDINGS AND RECOMMENDATIONS
27
5.2 CONSTRUCTION OF INDEPENDENT COMMUNITY WATER SUPPLY ALONG THE NORTHERN
COLLECTOR TUNNEL PHASE 1 TO THIKA DAM - MURANGA WATER SUPPLY
29
5.2.1 PROJECT SUMMARY
29
5.2.2 FINDINGS AND RECOMMENDATIONS
31
6 FINDINGS AND RECOMMENDATIONS LEGAL AUDIT

35

7 PROJECT SITE VISITS PHOTOGRAPHS

44

WASSIP-AF FINAL AUDIT REPORT

1 Executive summary
Chief Executive Officer
Athi Water Services Board
Africa Re-Centre, 3rd Floor, Hospital Rd
Nairobi, Kenya.

22 March 2016

Subject: Audit report for the Consultancy services for technical, legal and
financial audits of WASSIP AF projects under AWSB, Contract NO.
AWSB/WASSIP-AF/CS-40/2014
Dear Sirs:
I am delighted to present our audit report for the consultancy services for financial,
technical and legal audits of the Water and Sanitation Services Improvement Project
Additional Financing (WaSSIP AF) for the period 1 July 2015 to 30 September 2015.

1.1 Introduction
Miles Consulting Engineers in association with KagoKagwi& Associates, Certified
Public Accountants were appointed by Athi Water Services Board to carry out
consultancy services for financial, technical and legal audits of the Water and Sanitation
Services Improvement Project Additional Financing (WaSSIP AF).
The purpose of the assignment is three-fold:
1 Technical audit: Carry out a technical audit of the WaSSIP-AF for each quarter
starting from 1 July 2015
2 Legal audit: Carry out a legal audit of the WaSSIP-AF for each quarter starting from 1
July 2015.
3 Financial audit: Carry out a financial audit of the WaSSIP-AF for each quarter
starting from 1 July 2015
This report presents the detailed findings and recommendations arising from carrying out
the technical, legal and financial audits.

WASSIP-AF FINAL AUDIT REPORT

1.2 Our approach and methodology

In carrying out our financial, legal and technical audits, we focused on reviewing internal
control systems and procedures focusing on financial management, procurement
management, construction works management and legal and contracts management to
identify strengths and weaknesses. To fulfil our objective we followed the following six
steps:

Information gathering
Desk
review
and

sitevisits
Interviews

project

Draft report
Discussion of the draft report
Final report and presentations
to the management team

1.3 Opportunities to improve

To be done after the findings and recommendations have been agreed
with management of AWSB
Findings

Recommendations

1.4 Conclusion and next steps

AWSB management will need to prepare an audit action plan to guide the implementation
of the audit recommendations.

1.5 Confidentiality
This report has been prepared solely for the use of Athi Water Services Board and World
Bank in accordance with the contract agreement for provision of consultancy services
between Athi Water Services Board and Miles Consulting Engineers in association with
KagoKagwi and Associates and for no other purpose. It should not be made available to
third parties without our prior written consent. No responsibility to any third party is
accepted as the report has not been prepared for, and is not intended for, any other
purpose.

WASSIP-AF FINAL AUDIT REPORT

We would like to appreciate the cooperation and courtesy accorded to us by the

management of the Athi Water Services Board (AWSB) for the facilitation in preparation of
this report.
We would be glad to respond to any clarification or additional information that you may
require with regard to our report.
Yours sincerely,
Eng William Gachau
Project Director and Authorised Signatory
Miles Consulting Engineers
Telephone: +254(20) 722747995 / 737747995
Email:info@milesconsult.com

1.6 About WaSSIP-AF

WASSIP-AF FINAL AUDIT REPORT