Financial reporting in public primary schools in Kenya and the audit expectation gap: a survey of public primary schools in Nairobi.

Abstract

This study set out to establish if financial reporting in public primary schools in Kenya is of quality and influence the audit expectation Gap. Case study was carried out and a stratified random sample of 48 public primary schools in Nairobi Province was used to collect primary data. The data was analyzed using the SPSS soft ware using the percentages. mean and mode to draw the conclusions. The project examined various aspects of quality financial reporting and causes of audit expectation gap. It was evidence that financial reporting has a lot of influence on audit expectation gap between the public and the auditors. Secondary data was obtained from the relevant education departments with in the CC which was further used to develop the quality of financial reporting in public primary schools since 2004. The study determined that financial reporting carried out in public primary schools is still below average and this was attributed to poor policies and procedures involved in preparing the financial statements. Therefore it was strongly believed that financial reporting is the major contributing factor to audit expectation gap in public primary schools. The statements prepared failed the quality test index of reliability. relevance. consistency. comparability and neutrality. hence a lot of questions a rise as to what role the auditors play towards building trust in the stakeholders. Otherwise the study has noted the role the current government is play towards equipping primary head teachers with financial management skills. The quality of financial reporting is expected to improve in future