The Unclaimed Financial Assets Authority (UFAA) has entered into a collaboration with the Office of the Auditor General (OAG) to audit public sector agencies on compliance with unclaimed financial assets reporting and surrender.
The agreement stems from the Unclaimed Financial Assets Act, 2011 which empowers UFAA to examine records to determine whether the holder of unclaimed financial assets has complied with the Act. The law provides for timelines within which unclaimed financial assets in holders’ possession are to be reported to UFAA.
The Auditor-General is constitutionally mandated to audit and report on books of account of all public agencies every year. The partnership envisages scoping Auditor-General’s audit to include unclaimed financial assets reporting and surrender of these assets to UFAA by public agencies.
OAG audit will ascertain the extent to public agencies have been reuniting unclaimed financial assets with rightful owners on one hand, and on the other, identified, quantified, and surrender them to UFAA within the permissible timelines. Unclaimed financial assets Act provides for abandonment timelines ranging from one to five years.
UFAA’s Chief Executive Officer and Managing Trustee, Mr. John Mwangi, noted that state agencies and private firms are required by law to reunify rightful owners before the lapse of defined timelines.
‘In the event that the rightful owner or beneficiary has not been traced, the holder is required to submit residual presumed abandoned financial assets together with all available details of apparent owner to UFAA for eventual reunification,’’ said Mr. Mwangi.
Reporting and surrender of unclaimed financial assets take place on or before November 1 every year.
A baseline survey commissioned in the year 2018 estimated that Ksh241 billion in unclaimed financial assets was still unreported to UFAA by public agencies and private firms. The report further showed that an approximate 477,112 public and private entities hold these assets in their books.
Auditor-General Nancy Gathungu is optimistic that the synergy between UFAA and OAG will help unearth abandoned assets being held by public entities.
Unclaimed financial assets traverse the entire regime of cash in a bank, shares, insurance policies, money order, Court refunds, deposit for utility services, assets held in a ﬁduciary capacity, unpaid wages, safe deposit boxes, cheques, drafts or similar instruments. They also include deposits for utility services or matured retirement benefits.