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Fraud

Auditor confirms financial misappropriation at Nyali School – Mombasa

John Kombo Nyali Principal (centre in grey shirt)

It is very disheartening to note that corruption and financial misappropriation has been legalized at Nyali primary School in Mombasa. Several scandals that have been publicly exposed including the Bus scandal that was to rob the school over 600,000K and no action has been taken to date to rectify the situation and bring financial sanity in the school. Worst, now even majority of the board members are agreeing with parents that the school has over a decade lost several millions of Shillings through several scams and financial misappropriation.
To prove this, the External Auditor, who was recently called by the board to discuss the report, confirmed that there could be loopholes in payments of products & services that could not be counterchecked. He even suggested to the board to allocate another Auditor to scrutinize and confirm the genuineness of those documents of payments. It is believed that most of these receipts / invoices are either fake or fabricated to justify payments that have been inflated.
According to the Audit report for 2019 and 2020 which was done by Yusuf Juma & Co Auditors, the Auditor indicated in his report in page 6, that the Risk of not detecting a material misstatement resulting from FRAUD is very high. Significant fraud including a significant deficiency in internal controls were identified during the Audit.  He continues to conclude that future events or conditions may cause the club to CEASE to continue as a going concern. Meaning, the school and the club has no future due to the misappropriation of the school funds and may cease to exist if things are not rectified. The Auditor just ran short of declaring that there is a lot of financial misappropriation in the financial books.
The External Audit report showed a loss of 11.121M in 2020 from a surplus of 16.449M in 2019. It is still not known how the school recorded this huge loss in 2020 but many believe this may have included the payment of ghost workers that was initially highlighted and many other frauds involving financial misappropriation. But what do parents expect, when the treasurer, the Bursar and the head teacher all come from the same village and the accountant has a close relationship with the head teacher. Even, under accounting principles, this is not acceptable.  Cheques are signed without any guidelines and mostly for products or services that have been either inflated or faked.
Although, the Auditor indicated that the financial as calculated from the provided information shows a true and fair view of financial position of the club (a clear move of playing safe by the Auditor), he suggested that many documents provided as proof to payments ought to be scrutinized for genuineness.  It is understood that the board met on Monday 23rd Aug 2021 in a virtual meeting but the meeting could not adapt the Audit report.  The Monday meeting which up to now very little has come out, was later scheduled for Saturday 28th Aug 2021 where the External Auditor was to make his presentation. However, It is now known that several board members, including some members of the executive side abstained from the meeting for an unknown reason. Because of the low turnout, the Audit report was also not adapted. Parents are also eagerly waiting for their chance to dismiss the report. They shall demand for a proper explanation of the deficiencies and a scrutiny of the documents of payments by an independent person.
It is very sad, that Mr. Kombo and the club treasurer (who is also a shareholder of paramount Education centre – a school owned by Mr. Kombo) are controlling almost everything of the school. Many parents are asking how can a Treasurer entrusted with club money be a shareholder of a nearby school, a school that has been linked to be the recipient of Nyali school resources. How safe is Nyali accounts when the treasurer is also a shareholder of Paramount Education Centre? why are parents getting fooled with their Money? Many parents are struggling to raise the fees with many having been affected by the COVID-19 Pandemic.
Parents are just waiting for the AGM to raise their objection on a man they see as strategic in ensuring that resources belonging to Nyali School end up in Paramount – a school that he is a shareholder. But when is that AGM going to come? When will the election board be constituted to preside over election of a new board?  a new board that many parents believe will be a game changer, that will sweep off corruption and corrupt persons and bring financial sanity in the school. Whatever time it would take, the end to financial misappropriation is slowly coming. The chief perpetrators of corruption may not agree with this reality for now, but future is looking bright and many parents are waiting to exercise their democratic right during the AGM.  Nyali School will come back to its old glory days…. Our Money will be directed to our sons and daughters and ensure they get first class services and an environment that they deserve. The Quality services and environment that their parents who have worked hard to raise the funds have paid for….
We are not giving up the fight….
Nyali Parents


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