A joint statement by KAM and DI on concerns raised on project irregularities

20/06/2023: Reference is made to an article published on Monday, 19th June 2023 by The Standard newspaper, regarding the Kenya Association of Manufacturers (KAM) and Confederation of Danish Industry (DI) 2020 and 2021 project irregularities. KAM and DI would like to state the following:

DI has had a long-standing relationship with KAM, spanning over 20 years. The partnership has seen
DI support the Association through grants, capacity building projects and initiatives to make KAM a
financially sustainable Business Member Organization (BMO) and a strong voice for sustainable
development within the manufacturing space.

During the review of the 2020 and 2021 project audits, a discovery was made of falsified expenditures
of the DI funded project by a former staff member. Consequently, a forensic audit was initiated by
KAM, and action was taken on the audit findings. Accordingly, KAM undertook necessary corrective
actions to further tighten internal controls to prevent such an occurrence. In addition, DI appointed
an independent auditor to review KAM’s forensic audit and provide necessary findings for further
action. Resultantly, KAM will reimburse DI Kes. 3,922,435 and NOT Kes.39 million alleged by the
publication.

We would like to confirm that we reviewed the audit reports and their findings and took the
necessary administrative actions relating to KAM’s financial procedures and processes. DI has full
confidence in the leadership of KAM and the steps undertaken to strengthen its financial management
procedures and strict comprehensive controls including regular financial audits conducted by
reputable external auditing firms to continuously monitor all its processes to mitigate such future
cases. As part of DI’s commitment to the Danish Government, the organisation will enact closer
follow-up with KAM for a period to ensure that financial procedures are followed.

We would like to confirm that, DI and KAM have agreed to continue with the partnership agreement
once all measures have been enacted with a view to enhancing Kenyan manufacturers steps towards
green transition process.

KAM and DI affirm their commitment to their members, development partners and all stakeholders
on the prudent management of resources in line with laid down policies and core values of good
governance and professionalism.

Rajan Shah  
KAM Chairman 

Jesper Friis

Board Member, DI East Africa