The Senate Public Accounts Committee recently called for detailed audit of accounts of high revenue generating agencies instead of the current focus on those that do not generate much revenue. The committee made the call while commenting on the 2021 budget of the Office of the Auditor-General of the Federation.
The affected agencies include the Nigerian National Petroleum Corporation (NNPC), Nigeria Ports Authority (NPA), the Nigerian Maritime Administration and Safety Authority (NIMASA), Nigeria Customs Service (NCS), the Federal Inland Revenue Service (FIRS) and others. The committee is worried that while more attention is paid to agencies that generate low revenue, those that generate much revenue are overlooked. It also decried that such dereliction of duty on the part of the government auditors has been on since 2015.
The position of the Senate Public Account Committee on this issue can hardly be faulted. Without proper auditing of the accounts of these top revenue generating agencies, the much-needed development and good governance will be a mirage, especially at this time of recession and dwindling revenues. Therefore, pushing for a comprehensive audit of these big agencies is timely.
However, there is need to audit the accounts of all revenue generation agencies irrespective of the volume they generate. Therefore, no agency should be excluded from periodic audit.
Subjecting these agencies to proper auditing is the best way to ensure accountability and due process.
We say this because a recent AUGF report reveals that smaller agencies are as guilty as the bigger ones in remitting revenues to the Federation Account. All the same, a thorough audit of all revenue generating agencies has become imperative to ensure accountability and transparency.
In 2018, the National Economic Council (NEC) ordered some of the aforementioned agencies to refund the unremitted revenues totaling N8.526trillion to the Federation account. Unfortunately, only a few did. In 2017, the Fiscal Responsibility Commission (FRC) accused some MDAs of defrauding government of over N1trillion. PricewaterhouseCoopers (PwC) was appointed to conduct a forensic audit of NNPC. It is not clear the extent the recommendations of the audit report was complied with. Many audit reports of top revenue generating agencies have been unimplemented. The development has eroded public confidence in their operations. The failure of some of these agencies to be accountable has denied the government the much-needed funds for development.
Last year, not less than 16 revenue generating agencies failed to remit a total of N20billion to the Consolidated Revenue Fund (CRF). The Bureau of Public Enterprises (BPE) reportedly topped the list of unremitted revenue, with N7.5billion. In all, about 265 agencies of the Federal Government reportedly violated the fiscal and audit rules governing the operations of government accounts in 2017. This is in spite of the provision of the Financial Regulation 3210(v), which states that heads of government corporations, companies and commissions must submit both their audited accounts and management reports to the Auditor-General of the federation not later than May 31, of the following year’s accounts.
Sadly, stringent sanctions recommended by the Financial Regulations against violation of the financial regulation are hardly applied. The inability of those in charge to enforce these financial rules is encouraging malfeasance in the system.Despite the introduction of the Treasury Single Account (TSA) in August 2015, it is disturbing that these agencies still fail to remit some revenue to the government.
We believe that the pervasive rot in the Ministries, Departments, Agencies (MDAs) can be effectively checked with diligent auditing and enforcement of financial rules. To stem the endemic rot in these agencies, there should be strict compliance with extant rules and regulations guiding remittance of government revenues to the appropriate treasury. We call on the Auditor-General of the Federation to ensure strict compliance with the remittances of public accounts of all government agencies to the federation account. In this regard, any erring revenue agency must be appropriately sanctioned to deter others from doing so.