Section 192 of the Public Finance Management Act (2012) establishes the Public Sector Accounting Standards Board of Kenya.
The Accounting Standards Board of Kenya should consist of a representative of each of the following bodies who shall serve on a part-time basis—
- the National Treasury;
- the Controller of Budget;
- the Intergovernmental Budget and Economic Council;
- the Auditor-General;
- the Institute of Certified Public Accountants of Kenya;
- the Association of Professional Societies of East Africa;
- the Capital Markets Authority;
- the Institute of Internal Auditors; and
- the Institute of Certified Public Secretaries of Kenya.
The Cabinet Secretary responsible for financial matters should appoint a chairperson of the Board from the members nominated above.
In making nominations to the Board, the respective organisations should ensure that their nominees are certified members in good standing of a professional body in accounting or finance recognised by law in Kenya.
The Finance Cabinet Secretary should appoint Board members except for ex-officio members. The appointed members should serve for a term of not more than three years.
The National Treasury should provide secretariat services to the Board and assign or appoint such support staff as may be necessary for the Board to effectively perform its functions.
The Board may establish and regulate its own operating procedures.
Functions of the Public Sector Accounting Standards Board of Kenya
The Accounting Standards Board should provide frameworks and set generally accepted standards for developing and managing the accounting and financial systems by all State organs and public entities.
In particular, the Accounting Standards Board of Kenya should perform the following functions—
- set generally accepted accounting and financial standards;
- prescribe the minimum standards of maintenance of proper books of account for all levels of Government;
- formulate internal audit procedures which comply with the Public Finance Management Act;
- prescribe formats for financial statements and reporting by all state organs and public entities;
- publish and publicise the accounting and financial standards and any directives and guidelines the Board prescribes;
- in consultation with the Cabinet Secretary for finance on the effective dates of implementation of these standards, Gazette the dates for application of the standards and guidelines; and
- perform any other functions related to advancing financial and accounting systems management and reporting in the public sector.
In setting the standards mentioned above, the Accounting Standards Board should consider any relevant factors including—
- best international accounting practices; and
- the capacity of the relevant entity to comply with the standards.
The Board may set different standards for different categories of entities to which these standards apply including to develop content, structure and format of county frameworks and accounting and financial guidelines which are in line with the setting of county standards.
The Accounting Standards Board of Kenya should monitor the adherence to the standards by all State organs and public entities.
The standards set by the Board should promote transparency and other Constitutional values and principles in effective, prudence and efficient management of revenue, expenditure, assets and liabilities of the institutions to which these standards apply.
Vacation of office and remuneration of Board members
A member of the Accounting Standards Board, other than an ex-officio member, may at any time resign from the Board by notice in writing to the chairperson.
The member may also be removed from the Board if the member—
- has been absent from three consecutive meetings of the Board without the permission of the chairperson;
- is adjudged bankrupt or enters into a composition scheme or arrangement with his or her creditors;
- is convicted of an offence involving dishonesty or fraud
- faces conviction of a criminal offence and sentenced to imprisonment for a term exceeding six months or to a fine exceeding one hundred thousand shillings;
- is incapacitated by prolonged physical or mental illness or is deemed unfit to discharge his or her duties as a member of the Board; or
- ceases to be a member by virtue of the withdrawal of his or her nomination to the Board by the nominating institution.
The Salaries and Remuneration Commission should determine the remuneration payable to members of the Accounting Standards Board of Kenya.
Find the Board’s website at psasb.go.ke.