Susan Maina is a content writer at Mugo and Company, where she simplifies Accounting, Auditing, and Forensic Audit services with her finance expertise.
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If you’re running a small or Tier 3 SACCO in Kenya, you’ve probably asked yourself:
“What does auditing a SACCO involve, and how does it impact my business?“
You’re not alone. Many SACCO managers and members find audits confusing — especially when it comes to SASRA compliance,ICPAK requirements, financial accuracy, and IFRS reporting standards.
At Mugo & Company, we specialize in auditing SACCOS in Kenya, guiding small-scale SACCOs through every step – from planning and internal control reviews to testing transactions and preparing compliant audit reports.
In this guide, we’ll walk you through auditing SACCOS in Kenya, step by step – so you can understand the process and make informed decisions for your SACCO.
So let’s dive right in!!
Table of Contents:
A SACCO (Savings and Credit Cooperative) is more than just a financial institution—it’s a community of members pooling savings and accessing loans.
Mugo & Company can conduct your audit, explain the results, and guide you on next steps.
Book a Free Consultation with Mugo & Company TodayWhatsAppAuditing SACCOS in Kenya ensures you:
Ensure your records are accurate and reliable
Build confidence and trust with your members
Stay fully compliant with SASRA regulations
Identify and fix gaps before they escalate into big problems
Think of auditing as a financial health check for your SACCO.
At Mugo & Company, we don’t just audit; we help you understand your SACCO’s financial position and improve your internal controls so you can grow sustainably.
Did you know that SASRA (Sacco Societies Regulatory Authority) maintains a list of licensed auditors for SACCOS in Kenya which they release every year?
For 2026, SASRA published a comprehensive list of 430 audit firms in Kenya authorized to audit SACCOS. We’re proud to share that Mugo & Company is on this list.
You can view the full official list here: Authorized External Auditors for Regulated SACCOS.
Working with a SASRA-approved auditor like Mugo & Company ensures your SACCO benefits from:
Compliance with all SACCO regulations
Accurate and trustworthy financial reporting
Peace of mind for your members
With years of experience auditing both Tier I and Tier II SACCOS, we guide your SACCO through every stage of the audit process—from planning and testing transactions to preparing audit reports and follow-ups.
Partnering with a trusted auditor not only ensures regulatory compliance but also strengthens your SACCO’s credibility with members and investors alike.
What exactly do auditors like Mugo & Company look for when auditing SACCOs in Kenya?
| Audit Area | Key Questions Auditors Ask |
|---|---|
|
Member Contributions & Savings |
Are all member deposits properly recorded and accounted for? |
|
Loan Records
|
Are loans approved, documented, and repaid correctly according to your SACCO policies?
|
|
Financial Statements
|
Are your reports prepared according to IFRS standards and reflecting true financial position?
|
|
Internal Controls
|
Are systems in place to prevent fraud, errors, or mismanagement?
|
|
Compliance |
Are you meeting SASRA requirements for Tier I or Tier II SACCOS?
|
|
Expected Credit Losses (IFRS 9)
|
Are you applying the Expected Credit Loss (ECL) model correctly?
|
N/B:
Are you wondering what IFRS 9 in Kenya actually says about Auditing SACCOS in kenya, check out or simple guide, IFRS 9 Financial Instruments in Kenya.
Having this Audit checklist ready not only streamlines the audit process but also demonstrates to your members that your SACCO is well-managed, compliant, and transparent.
Auditing a SACCO is a structured process that ensures your records are accurate, reliable, and compliant.
Here’s what we do at Mugo & Company when auditing SACCOS in Kenya:
Step 1: Planning & Risk Assessment
We evaluate your SACCO’s operations, financial risks, and key areas of concern.
Step 2: Reviewing Internal Controls
We examine how funds flow through your SACCO to prevent errors or fraud.
Step 3: Testing Transactions
We verify loans, savings, and expenses for accuracy and compliance.
Step 4: Evaluating Financial Statements
We ensure your reports reflect your true financial position and compliance with IFRS.
Step 5: Compliance Check
We confirm adherence to SASRA regulations and IFRS 9, including the Expected Credit Loss (ECL) model.
Step 6: Reporting
We produce a clear audit report with observations, including qualified opinions if necessary (see our guide on a Qualified Audit Opinion in Kenya).
Step 7: Follow-Up
We advise on corrective actions to strengthen financial management and reporting controls.
No matter your SACCO’s size, regular audits help you stay transparent, build trust, and prepare for growth.
Book your Free Consultation with us today
A key part of auditing SACCOS in Kenya is ensuring compliance with IFRS 9, which affects how your SACCO:
Recognizes loan impairments
Applies the Expected Credit Loss (ECL) model
Values financial instruments accurately
Small-scale SACCOS often find IFRS 9 challenging. That’s why partnering with Mugo & Company, experts in auditing SACCOS in Kenya, ensures your SACCO applies standards correctly and avoids penalties.
Recommended Articles: 1. What is a Qualified Audit Opinion in Kenya |
1. What are the 7 steps in the audit process for SACCOS?
The audit process for SACCOS in Kenya typically follows these 7 steps:
Planning – Understanding your SACCO and its financial environment.
Risk Assessment – Identifying areas where errors or fraud are likely.
Internal Control Review – Checking processes to prevent mismanagement.
Testing Transactions – Verifying loans, savings, and expenses.
Evaluation – Reviewing financial statements for accuracy and compliance.
Reporting – Preparing the audit report with observations and recommendations.
Follow-Up – Advising on corrective actions and improvements.
2. What is the difference between an internal and an external audit?
Internal audits are conducted by your SACCO team to improve internal processes, detect errors, and strengthen controls.
External audits, like those performed by Mugo & Company, are SASRA-required and provide an independent, credible assessment of your SACCO’s financial statements.
3. What are the different types of SACCOS in Kenya?
SACCOS in Kenya are classified into three tiers based on total assets:
Tier I SACCOS – SACCOs with total assets above KSh 5 billion. These are usually large, deposit-taking SACCOs.
Tier II SACCOS – SACCOs with total assets between KSh 1 billion and KSh 5 billion.
Tier III SACCOS – SACCOs with total assets below KSh 1 billion, typically small-scale or emerging SACCOs.
Auditors take your SACCO’s tier into account when reviewing compliance, risk, and financial reporting, ensuring that audits meet SASRA and IFRS requirements.
4. Why is auditing important for small-scale SACCOS in Kenya?
Auditing SACCOS in Kenya helps small-scale SACCOs to:
Protect member funds by verifying deposits and loans.
Ensure regulatory compliance with SASRA and IFRS standards.
Strengthen financial credibility with investors, regulators, and members.
A proper audit also highlights areas for improvement, helping your SACCO grow sustainably.
At Mugo & Company, we specialize in auditing SACCOS in Kenya, helping small-scale SACCOs like yours:
Complete audits smoothly
Identify risks early
Ensure compliance with SASRA and IFRS standards
Apply the Expected Credit Loss model correctly
We’ve guided hundreds of SACCOs in Kenya to maintain transparency, build trust with members, and strengthen internal controls.
Ready to audit your SACCO the right way?
Contact us today for a free consultation. We respond within 48 hours.
Click the WhatsApp button to book your free consultation with Mugo & Company now.
Or email us at info@mugo-co.com
WhatsAppThe information provided in this guide on auditing SACCOS in Kenya is for general informational purposes only and does not constitute professional advice. For advice specific to your SACCO, please consult a licensed auditor, such as Mugo & Company.
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