Audit flags Jomo Kenyatta Foundation instability, threatening 14,000 scholarships
Audit flags Jomo Kenyatta Foundation instability, threatening 14,000 scholarships
The Jomo Kenyatta Foundation (JKF) is facing an uncertain future as a recent audit has exposed severe financial instability and management weaknesses, threatening the continuation of its scholarship programs.
The state agency, tasked with providing educational support and publishing textbooks, is struggling under mounting debts and declining revenues, raising doubts about its ability to operate effectively.
The Auditor General’s report highlights a worrying decline in JKF’s financial health. By June 2025, the foundation had accumulated losses of Sh934 million.
Although the annual net loss of Sh167 million is smaller than the Sh303 million reported the previous year, the Auditor General, Nancy Gathungu, cautioned that this improvement is too small to reverse the overall risk of insolvency.
“The losses have resulted in substantial erosion of the net worth of the foundation,” Gathungu noted, warning that JKF may be unable to meet its financial obligations.
The audit shows a severe imbalance between the foundation’s assets and liabilities, with current liabilities of Sh779 million against current assets of just Sh207 million, creating a negative working capital of Sh571.6 million.
JKF management attributes the worsening position to the collapse of its publishing operations. The foundation once relied heavily on textbook sales, but new policies allowing private publishers into the market drastically reduced its share.
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Publishing revenue fell by 79 per cent, from Sh117 million to Sh25 million, driven by the lack of government textbook orders, stiff competition in private schools, and large quantities of obsolete stock after the transition to the Competency-Based Curriculum.
“Lack of any government orders meant that the public schools segment was largely locked out for Jomo Kenyatta Foundation, leaving her to compete with other publishers in the very small private schools market,” JKF chairperson Rose Waruhiu said in the annual report.
The foundation also faces uncertainty over its core mandate. JKF currently administers the World Bank-funded Elimu Scholarship Programme, supporting more than 14,000 students nationwide.
However, a task force appointed by President William Ruto has proposed transferring this responsibility to a new Kenya Basic Education Bursary and Scholarship Council.
On top of this, JKF is included in a list of state agencies slated for dissolution under ongoing parastatal reforms, further casting doubt on its future.
Operational and compliance failures deepen the crisis. JKF failed to remit Sh99.4 million in statutory deductions, including Pay-As-You-Earn, NSSF, NHIF, and pension contributions, exposing it to penalties, interest, and potential legal action.
Outstanding bills at the time of the audit totalled Sh737 million, with Sh548 million overdue for more than a year. Gathungu warned that delays in payments increase the risk of litigation and financial loss.
Other issues include missed quarterly stock counts, raising questions about the accuracy of Sh31 million in reported inventory, failure to meet employment requirements for persons with disabilities, staff receiving net pay below legally required thresholds, unexplained adjustments to payables, errors in cash flow statements, and misstatements in grant disclosures.
The audit paints a picture of a foundation at a crossroads, grappling with financial pressure, structural reforms, and management shortcomings, leaving its role in Kenya’s education system uncertain.
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