The overall fiduciary risk in the Kenya Education Sector Support Programme (KESSP) was found to be High. The risks assessments were based on a combination of two previous Public Expenditure Financial Accountability (PEFA) assessments in 2006 & 2008; Education Sector-specific financial management assessments; and professional judgement.

The assessment reviewed public financial management accountability (PFMA) at the national level central processes before examining the Education Sector-specific issues. DFID’s approach recommends that an assessment of the strengths and weaknesses of PFM systems be based on the PEFA methodology, which evaluates 28 high-level PFM indicators, grouped into six broad categories based on the budget cycle.

Issues raised in the PEFA which are likely to affect PFMA performance in the sector include:

• Credibility of the budget
• Comprehensiveness and transparency
• Policy based budget
• Predictability and control in budget execution
• Accounting, recording and reporting
• External scrutiny and audit
• Fiduciary risk issues from the nature and composition of revenue and expenditure in the sector
• National expenditure profile
• The adequacy of Education sector financial management capacity
• The main corruption risks at sector level