Auditor General Wants Allocations of Defaulting MDAs Withheld

Chuks Okocha in Abuja

Auditor General of Federation (AGF), Anthony Ayine, has submitted the 2017 audit report of the Ministry Department and Agencies (MDAs) to the National Assembly with a recommendation that the financial allocations to defaulting agencies be withheld.

In the recommendation contained in the Executive Summary to the Senate Public Accounts Committee, the Auditor General said “stringent sanctions, including withholding financial releases and sanction of the chief executive officer should be imposed on defaulting agencies that do not render timely accounts as provided in the constitution, financial regulations and other relevant laws.”

The Auditor General also said 160 agencies defaulted in submission of audited accounts for 2016; 265 agencies defaulted in submission of audited accounts for 2017; and that eleven agencies have never submitted any financial statements since inception.

“Although we have noticed a marked improvement since my last report, there are still some violations of statutory financial reporting obligations by parastatals,” he said.

Relying on the constitutional provisions as contained in the 1999 Constitution as amended, Ayine said: “I am required by Section 85 (5) of the Constitution of the Federal Republic of Nigeria 1999 (as amended) to submit my report on the audit of the Accountant-General’s Financial Statements to the National Assembly within 90 days of receipt of the statements from the Accountant-General of the Federation.

“The Financial Statements of the Federal Government of Nigeria for the year ended 31st December, 2017 were first submitted to me by the Accountant-General of the Federation on 20th December, 2018. Following my preliminary observations, the statements were significantly amended and resubmitted on 26th April, 2019.

“In accordance with Sections 85 (2) and (5) of the constitution, I have examined and certified the accounts subject to the comments and observations contained in this report.”

He added: “The Financial Statements of Government Statutory Corporations, Companies, Commissions, etc., otherwise called parastatals are not audited by my office in line with Section 85(3) (a) of the 1999 Constitution.

“However, in accordance with Section 85(3)(b) of the constitution, their annual accounts and audit reports thereon shall be submitted to me for comments. Some of the government corporations, companies and commissions have not submitted their audited accounts to me as at 30th June 2019, despite the provision of Financial Regulation 3210(v) which enjoins the chief executive officers of these bodies to submit both the audited accounts and management reports to me not later than 31st May of the following year of accounts.”

The report further revealed some defaults in the audit report of the MDAs, saying “a number of major weaknesses and lapses in the management of public funds and resources were identified across several MDAs during the annual audit. A separate section is therefore included in this annual report to highlight the key issues.”

“Our findings range from irregular expenditures to failure to surrender surplus revenues to the treasury, all running into billions of naira. Also notable was the continuing failures in the implementation of International Public Sector Accounting Standards (IPSAS).

“Overall, our findings are indicative of significant weaknesses in expenditure control, accounting, financial reporting and in the completeness and accuracy of the consolidated financial statements,” he said.

The report alleged that “delays in budget passage, low levels of budgetary release across government and the impact on the ability of the MDAs to perform – as in previous years, the annual budgeting process of the federal government remains flawed and unable to support genuine development.”

“Delays in the passage of the budget had a direct impact on the ability of MDAs to perform their functions and rendered the annual budget execution process ineffective to a large extent (especially regarding capital expenditures). There remains the need for the executive and the legislature to work better together on the passage and implementation of budgets, if Nigeria is to achieve meaningful development,” Ayine added.

The Chairman Senate Committee on Public Accounts, Senator Matthew A. Urhoghide, had on November 19, 2019 at a press briefing listed 25 defaulting MDAs that had not responded to their inquiries to enable the Senate carry out its oversight functions.

It could not be immediately ascertained whether the MDAs listed by the Senate Committee are among the erring ones captured in the Auditor General’s 2017 report.