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Kenya Power Faces kes 1.7 billion Penalty for Withheld Unclaimed Assets to the State.

Kenya Power  risks a kes 1.765 billion penalty for not surrendering to the State unclaimed assets. The unclaimed assets include dividends,deposit refunds, unidentified receipts, unpaid customer electricity deposits, unpaid wayleaves compensation and stale cheques  that are required to be surrendered to the government according to the law.

The value of the  assets is 3.5 times the kes 262 million net profit that KPLC made in 2019.

Nancy Gathungu the Auditor-General disclosed in the latest audit report that the utility firm was still holding  Kes 922 million  at the end of June last year in its books against the requirements of Unclaimed Financial Assets Act, 2011. she further stated that unclaimed assets, ought to have been surrendered to the Unclaimed Financial Assets Authority (Ufaa).

“Although the management is confident that the outstanding balance will drop following the ongoing review and audit of assets, this aspect of non-compliance may cost the company up to kes 1.765 billion in interest and penalties as at June 30, 2019,” warned Auditor-General.

Ufaa latest data shows unclaimed assets have risen by 23 % in 2019 or kes 3 billion to kes 16 billion, most in uncollected salaries, pension dues, matured policies, bank deposits and royalties.

Kenya Power had however noted in the previous annual report that it was yet to submit qualifying unclaimed assets at end of the four financial years to June 2017, only saying it was engaging Ufaa.

Cash flow challenges also saw KenGen hit Kenya Power with a Sh722.31 million financial penalty for flouting 40-day window of paying for the electricity supplied in the financial year ended June 2019.

The unclaimed assets include dividends, deposit refunds, unidentified receipts, unpaid customer electricity deposits, unpaid wayleaves compensation and stale cheques  that are required to be surrendered to the government according to the law.

The value of the  assets is 3.5 times the kes 262 million net profit that KPLC made in 2019.

Nancy Gathungu the Auditor-General disclosed in the latest audit report that the utility firm was still holding  Kes 922 million  at the end of June last year in its books against the requirements of Unclaimed Financial Assets Act, 2011. she further stated that unclaimed assets, ought to have been surrendered to the Unclaimed Financial Assets Authority (Ufaa).

“Although the management is confident that the outstanding balance will drop following the ongoing review and audit of assets, this aspect of non-compliance may cost the company up to kes 1.765 billion in interest and penalties as at June 30, 2019,” warned Auditor-General.

Ufaa latest data shows unclaimed assets have risen by 23 % in 2019 or kes 3 billion to kes 16 billion, most in uncollected salaries, pension dues, matured policies, bank deposits and royalties.

Kenya Power had however noted in the previous annual report that it was yet to submit qualifying unclaimed assets at end of the four financial years to June 2017, only saying it was engaging Ufaa.

Cash flow challenges also saw KenGen hit Kenya Power with a Sh722.31 million financial penalty for flouting 40-day window of paying for the electricity supplied in the financial year ended June 2019.