Twenty-one public universities, including Kenyatta University and the University of Nairobi (UoN), are facing possible collapse after the Auditor General revealed they have accumulated a combined negative working capital (current liabilities (short-term debts) are greater than their current assets) of Ksh42.5 billion.
In her 2023/2024 financial year report, Nancy Gathungu said the institutions’ current liabilities far exceeded their current assets, raising doubts about their ability to meet short-term financial obligations.
She cautioned that the situation threatens financial sustainability and could cripple operations, including staff pay and service delivery.
Kenyatta University posted the highest deficit at Ksh 10.9 billion, followed by the University of Nairobi with Ksh 8.0 billion.
Other universities facing major shortfalls include Egerton University, Jomo Kenyatta University of Agriculture and Technology, Moi University, and the Technical University of Kenya.
“These substantial deficits reflect serious liquidity challenges, with implications on creditor payments, staff remuneration, and overall service delivery,” Gathungu noted.
According to the report, many universities continue to operate largely on the assumption of government support or the goodwill of creditors.
KU, UoN Among 21 Public Universities on Brink of Collapse as Debt Hits Ksh42B
Egerton University ranks third in the list of indebted institutions with Ksh 7.4 billion in liabilities, followed closely by Jomo Kenyatta University of Agriculture and Technology (JKUAT) with Ksh 6.6 billion and Moi University at Ksh 3.6 billion.
The Technical University of Kenya (TUK) is also struggling under a debt burden of KSh 5.6 billion.
Other institutions facing financial distress include Multimedia University of Kenya, which owes Ksh 1.6 billion, Dedan Kimathi University with Ksh 21.2 million, University of Kabianga with Ksh 609.6 million, and South Eastern Kenya University at Ksh 3.1 million.
Taita Taveta University has accumulated Ksh 259.5 million in debts, while Alupe University College owes Ksh 49.7 million. Meru University of Science and Technology and Chuka University face debts of Ksh 198.1 million and Ksh 240.2 million, respectively.
Garissa University owes Ksh 22.3 million, Maasai Mara University Ksh 280.5 million, Laikipia University Ksh 55.1 million, and the Technical University of Mombasa Ksh 334.5 million.
The Kenya Advanced Institute of Science and Technology has the smallest figure at Ksh 510,685, followed by Kisii University at Ksh 189,440, while Pwani University, though least indebted overall, still owes Ksh 112,000.
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Public Universities Operating with Negative Working Capital
| No. | Name of University | Current Assets (Ksh) | Current Liabilities (Ksh) | Working Capital (Ksh) |
| 1 | Kenyatta University | 1,435,218,526 | 12,414,394,021 | 10,979,175,495 |
| 2 | Jomo Kenyatta University of Agriculture and Technology (JKUAT) | 3,683,020,574 | 10,286,047,264 | 6,603,026,690 |
| 3 | Moi University | 4,148,174 | 7,782,304 | 3,634,130 |
| 4 | Taita Taveta University | 128,058,006 | 388,010,433 | 259,952,427 |
| 5 | Alupe University College | 63,403,032 | 113,061,791 | 49,658,759 |
| 6 | Multi-Media University of Kenya | 381,620,861 | 2,066,432,654 | 1,684,811,793 |
| 7 | University of Nairobi | 6,828,595,435 | 14,877,327,773 | 8,048,732,338 |
| 8 | University of Kabianga | 304,581,191 | 914,147,457 | 609,566,266 |
| 9 | Egerton University | 2,532,690,615 | 9,994,817,018 | 7,462,126,403 |
| 10 | Dedan Kimathi University of Technology | 498,176,484 | 519,419,716 | 21,243,232 |
| 11 | Meru University of Science and Technology | 414,737,411 | 612,799,008 | 198,061,597 |
| 12 | Garissa University | 128,990,994 | 151,224,911 | 22,233,917 |
| 13 | Kisii University | 798,678 | 988,118 | 189,440 |
| 14 | Maasai Mara University | 552,058,580 | 832,600,444 | 280,541,864 |
| 15 | Laikipia University | 379,626,999 | 434,726,200 | 55,099,201 |
| 16 | Pwani University | 217,821 | 329,684 | 111,863 |
| 17 | Chuka University | 595,359,104 | 835,524,084 | 240,164,980 |
| 18 | Technical University of Kenya (TUK) | 1,915,257,575 | 7,604,104,706 | 5,688,847,131 |
| 19 | South Eastern Kenya University | 353,876,377 | 357,071,937 | 3,195,560 |
| 20 | Technical University of Mombasa | 375,552,004 | 710,099,222 | 334,547,218 |
| 21 | Kenya Advanced Institute of Science and Technology | 7,535,084 | 8,045,770 | 510,686 |
| Total | — | — | 42,545,430,990 |
Audit Uncovers Financial Mismanagement in Kenyan Public Universities
A review of financial records raised concerns over weak financial management and governance practices in several public universities. The audit revealed unsupported balances totalling Ksh 20,039,690 in the University of Nairobi (UoN), Kisii University, and the Technical University of Kenya (TUK).
These amounts included dormant endowment funds, unexplained differences in reported overdrafts, and stagnant bank balances without proper documentation, such as reconciliations or cash books.
Further scrutiny showed that Egerton University, Taita Taveta University, and Garissa University had unreconciled balances amounting to KSh 43,250,934.
The discrepancies arose from differences between cash book and bank statement records, including unrecorded receipts, unposted payments, and inconsistencies in reported balances.
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The audit also flagged serious breaches of financial regulations, with two universities found to have operated accounts or facilities without the necessary approval from the National Treasury.
Egerton University maintained a bank overdraft facility of Ksh 6,688,642 without Treasury authorization, while Murang’a University of Technology operated two bank accounts with balances totaling Ksh 35,052,803 without approval, contravening Regulation 82(1) of the Public Finance Management (National Government) Regulations, 2015.
In addition, governance lapses were identified in other institutions. The Technical University of Kenya failed to maintain a dedicated development account, raising concerns over transparency in managing project funds.
Turkana University College did not open a separate account for contractor retentions and trust-held funds, exposing earmarked resources to possible misapplication.
At Jaramogi Oginga Odinga University of Science and Technology, auditors found only three cash books being used to manage 30 active research projects, a practice that risks commingling of funds and undermines financial accountability.
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