Chaos broke out at Kasigau Ranching Company’s annual general meeting (AGM) after shareholders clashed with the board of directors over the manner in which millions of shillings were spent.
During the accused meeting, marked by heavy police presence, the over 3,750 shareholders rejected the reports of the company auditors and secretaries, calling them biased and inappropriate.
Kasigau commander Benard Otomei and his officers stood guard as shareholders and directors made accusations about the spending of money at the ranch, which they said was facing a financial and management crisis.
The shareholders refused to approve the financial statements and kicked out officials from the company’s accounting firm and company secretary Victor Were. They said their reports did not reflect the true state of affairs at the ranch.
Besides rejecting the two reports, the shareholders asked the provincial government to appoint an independent forensic auditor to investigate how more than Sh100 million disbursed by Wildlife Works through Kasigua to reduce emissions from deforestation and forest degradation ( REDD project) if carbon credit disbursements were spent last year.
“We have today decided to disapprove the reports of the auditor and the company secretaries and the two offices no longer represent our corporate interests. The two offices are biased and protect the interests of the directors. They do not reflect the true state of affairs of the company facing a management and financial crisis. We will appoint new ones to represent our interests and all nine directors should go home,” Gibson Dodi, a shareholder, told County Chief Officer Stephen Mcharo who attended the meeting.
Leonard Mwachia, a shareholder, said: “We have no confidence in the accountant and the company secretary and they should all go home because they are not outliving our interests. We cannot determine the audit report because we received the annual accounts at the AGM.”
Mcharo called for a forensic audit of the ranch to determine its true financial position. “It is important to have an independent forensic audit,” he said.
The shareholders said the directors have traveled extensively instead of working to ensure the ranch’s financial stability.
During the AGM, the ranch chairman, Jonathan Mwangeje, and the directors struggled to explain how they spent millions of shillings on administrative purposes and projects.
According to The Standard’s audit report, over Sh24.9 million was spent on administrative expenses such as directors’ travel expenses, subsistence and sitting allowances, meals and refreshments, seminar fees, consultancy fees and capacity building, among other extravagant expenses.
However, Ambale Ogot and Company LLP, the ranch auditor, defended their report saying they exercise professional judgment and always work professionally during the audit.
“We also identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to these risks, and obtain audit evidence that is sufficient and appropriate as a basis for our judgment,” he told shareholders.
The accountant has stated that the information in the management report is consistent with the annual accounts.
However, the accounting firm said the ranch’s directors are responsible for preparing and fairly presenting financial statements that give a true and fair view in accordance with international financial reporting standards.
The company further said that the audit report complies with the requirements of the Kenyan Companies Act, 2015, and that the internal controls that the directors consider necessary to enable the preparation of financial statements that are free from material misstatement, whether as a result of fraud or errors. .
“In our opinion, the accompanying financial statements give a true and fair view of the state of affairs of the Company as of December 31, 2023, and of its financial performance and cash inflows for the year ended in accordance with International Financial Reporting Standards. Kenyan Companies Act, 2015,” the audit firm report said.
Two directors, Allen Mwakesi and John Mwanjala, disagreed with the auditor, saying there was a crisis in the ranch’s management.
The two directors advised shareholders to decide the ranch’s fate by electing responsible and transparent ranch leadership.
“The implementation of the Sh19 million Eco Lodge, which has since stalled, is a bad investment,” says banker Mwakesi.
