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AG Speech

Welcoming remarks by the Auditor-General-Kenya, Edward Ouko, during the 3rd meeting of the international organisation of supreme audit institutions-working group on audit of extractive industries (Intosai-Wgei), Prideinn Paradise hotel, Mombasa, august 24, 2016. 

The Principal Secretary, Ministry of Mining, Dr. Ibrahim Mohamed, the Auditor-General of Uganda and Chairman of INTOSAI-WGEI, Mr John Muwanga, the Auditor-General of South Sudan, Amb. Steven Wondu, Heads of Delegations,development partners, distinguished delegates, ladies and gentlemen.

I am pleased to welcome all of you to the 3rd Meeting of the INTOSAI-WGEI. I want to specifically thank my colleague and friend, the AG of Uganda, Mr Muwanga for having faith and trust in Kenya to host this year’s Conference. As Office of the Auditor-General, Kenya, we feel greatly honoured.

 

 

Ladies and gentlemen,

 The world today continue to witness new discoveries of oil, gas and minerals and this calls for proper management of these resources for the benefit of the citizens. In 2012, my country Kenya discovered commercial quantities of oil in northern Kenya. Though this is a blessing to the country, if not handled well, the oil drilling could cause environmental degradation to the pastoralist communities by contaminating, through spillage, grazing and watering area of their animals.

 The role of Supreme Audit Institutions (SAI) is therefore well cut-out in this emerging sector. INTOSAI, aware of the need for proper management of these resources, formed a Working Group on Audit of Extractive Industries (WGEI) in 2013 to promote audit of extractive industries within the INTOSAI community in order to support good governance and sustainable development for the UN post 2015 agenda, now Sustainable Development Goals.

SAI Kenya has put in place a team of auditors to specifically audit the extractive industries, and their role can only get bigger and more crucial, with the news that Kenya will start exporting its oil by next year.

 Challenges

 Distinguished delegates

But challenges are abound, given the complexity and technical nature of this industry. Just like other SAIs, Kenya has witnessed limited technical capacity in the audit of extractive industries and is at the risk of losing the few specialised staff to other sectors in the economy.

 Additionally, lack of a policy is the audit of extractive industries poses a challenge for auditors to access the needed oil and gas information for audit, to enable them come up with good and implementable audit recommendations which can improve services to citizens.

 It is our hope, as INTOSAI community, that these challenges are not insurmountable. Concerted efforts from development partners, governments, experts and INTOSAI will no doubt chart the way forward in addressing these challenges.

 Audit of extractive industries

Ladies and gentlemen

The costs recoverable from oil explorations has been a subject of concern for Supreme Audit Institutions. I have been to some of the locations across the world and noticed that these costs are being incurred by oil companies. It has been a subject for discussion lately, with renewed interests in making sure that whatever the companies are incurring are the accurate and valid costs. I want reiterate that the Office of the Auditor-General will ensure that these companies only recover the costs that they incur and we need to work together with the Ministry of Energy and Petroleum and the Revenue Authorities to achieve this.

 Ladies and gentlemen,

This Meeting is centred around the theme: “The role of Supreme Audit Institutions in ensuring sustainable growth from extractive industries.” This theme perfectly fits with the UN post 2015 agenda (Sustainable Development Goals) and depicts the seriousness of INTOSAI to play its role in the management of these natural resources. The attainment of these goals lies with every institution, with the ultimate goal of transforming lives of the citizens. It is a role that cannot be left to the UN and INTOSAI alone, every institution must be in this train as we are all leading to one destination. It is my hope therefore, that the galaxy of experts at this Conference will put their thoughts together to come up with a roadmap that leads to this common destination.

 Ladies and gentlemen,

In conclusion, ladies and gentlemen,  

I want to thank the government officials, led by the Principal Secretary, the Auditors-General presents, Heads of delegations, development partners and distinguished delegates for taking time to attend this Conference. It is my hope that the Conference will yield tangible deliberations for the benefit of Wanjiku (citizens).

I welcome all of you to Mombasa for this Conference. I also urge you to take some time, after the Conference, to sample the beauty of this wonderful city.

Thank you 

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