The Office of the Auditor General (OAG) has raised concerns over the accuracy and recoverability of receivables from exchange transactions after discrepancies emerged between figures reported in the financial statements and records held by the Social Health Authority (SHA) and the National Hospital Insurance Fund (NHIF) for Kitale County Referral Level 4 Hospital.
During the session by the Godfrey Osotsi-led Senate County Public Investment Committee, Trans-Nzoia governor George Natembeya, appearing before the Godfrey Osotsi-led Senate County Public Investment Committee, disputed the OAG report in the audit query, maintaining that the correct receivables position as at the end of the 2024/2025 financial year was Sh15,672,727 from SHA and Sh7,239,840 from NHIF, totalling Sh22,912,567.
OAG, in presenting before the senators, revealed that the financial year 2024/2025 said, “The statement of financial position reflects receivables from exchange transactions with a balance of Sh. 22,912,567 as disclosed in Note 20 to the financial statements.”
However, records from SHA and NHIF indicate receivables balances of Sh3,051,710 and Sh77,163,884.
The governor said that the management has constituted a debt management and recovery task force tasked with developing and implementing an effective debt recovery and management policy.
Natembeya said, “The management has appointed a debt management and recovery committee to formulate an effective debt recovery and management policy.”
The audit raised concerns over weak budgetary control and performance after a public hospital recorded significant underfunding, potentially affecting the delivery of medical services.
“The statement of comparison of budget and actual amounts reflects the final receipts budget and actual amounts of Sh. 97,691,046 and Sh. 68,350,646, respectively, resulting in an underfunding of Sh. 29,340,400, or 43% of the budget. The underfunding of the hospital may have affected the delivery of medical services to the residents.”
Natembeya told senators that the strike led to a revenue loss of Sh3,698,310, accounting for 3.8 percent of the total budget.
”The effect of the strike on hospitals’ revenue collection and operations resulted in a revenue loss of Sh3,698,310, which represented 3.8 percent,” he said.
Natembeya was questioned on the Wamalwa Kijana Teaching and Referral Hospital. The OAG flagged an unexplained variance of S14.1 million in receivables from exchange transactions, casting doubt on the accuracy and recoverability of outstanding claims from the Social Health Authority (SHA).
According to the hospital’s statement of financial position for the financial year 2024/2025, receivables from exchange transactions stood at Sh40,710,579. The amount relates to unpaid claims submitted to SHA for services rendered.
Presenting the data, the OAG told the Senate that the SHA portal for the period between 1 July 2024 and 30 June 2025, accessed on October 14, 2025, presents a different picture where the portal shows total approved claims amounting to Sh87,176,824, of which Sh60,562,102 had been paid, leaving unpaid claims of Sh26,614,722.
The report further indicates that the unpaid claims reflected on the SHA system, Sh14,095,857, are lower than the receivables reported in the hospital’s financial statements, resulting in an unexplained variance that could not be reconciled during the review.
“The value of outstanding claims on the SHA portal is not static but keeps on changing as the claims are subjected to the verification process, where some of the claims are paid, and others are sent back due to errors and omissions, which are resubmitted later to SHA after corrections and clarification have been made,” Natembeya said.
The Senate County Public Accounts Committee (CPAC) is currently operating within a critical three-month window from January to March 2026 to examine and debate the Auditor General’s (AG) reports before the house, where either the house will approve or reject the tabled report.
