Audit Reports And Fiscal Violations

Victor Emejuiwe

Victor Emejuiwe

The concept of audit according to the Lima Declaration, is the creation of a regulatory system whose aim is to reveal deviations from accepted standards and violations of the principles of legality, efficiency, effectiveness and economy of financial management, early enough to make it possible to take corrective action. In individual cases, to make those accountable to accept responsibility, to obtain compensation, or to take steps to prevent – or at least render more difficult such breaches.

Audit, being a post mortem exercise provides the opportunity to review budget implementation with a view to providing information and knowledge that can be used for course correction in subsequent budget cycles. However in Nigeria, the annual audit report has succeeded in providing the general financial overview of MDAs fiscal performances as well as recommendations for corrective measures where necessary. Despite the recommendations of the Auditor General’s report, it is sad that every year various degrees of fiscal infractions are still perpetrated. The 2018 and 2019 Auditor General’s report reveals another circle of infractions, in the conduct of most Ministries Departments and Agencies of Government affairs.

In the 2018 audit report, the issues raised, ranges from the “Non remittance of N48.55bn into the CRF. There were also cases of Non-deduction/Under deduction/Non Remittance of Statutory Taxes & Stamp Duties of N5.42Billion.  The OAUGF observed Irregularity in Contract Award, Execution & Payment to the tune of 18.37bn. The report also recorded irregularities in payment and expenditure to the tune of N23.48bn. Others include violation of N8.39bn store items not recorded; unretired cash advances/ imprest of 354.22m and circumvention of procurement process to the tune of N371.75m in select MDAs.

Meanwhile in 2019, the Audit report revealed that the Consolidated Financial Statements of the Federal Government had unsubstantiated balances of N4.973trn.  The FG did not audit its financial report within the stipulated timeframe, and as such, a whooping sum of N4.973trn could not be reconciled. This is against the provision of the Fiscal Responsibility Act, which provides that “The Federal Government publish its audited accounts not later than six months following the end of the preceding financial year.

With the continuous violations of the MDAs Fiscal affairs, it appears no lessons are taken from the audit reports. It also means those charged with the responsibility of enforcing accountability and probity in the use of public funds are either redundant or are also beneficiaries of the ongoing malpractices in the MDAs. Otherwise, it is expected that the legislative committees in charge of oversights on the respective indicted MDAs, summon the MDAs to explain why such levels of infractions occurred, and ensure that they comply with the Auditor General’s recommendation.

The ICPC and the EFCC as well, are expected to swing into action and invite responsible agents of the MDAs for questioning; following findings of such levels of infraction from the Auditor general’s report.

With this dereliction of duty, the citizens should demand for the amendment of the FRA. The FRA when amended recommended sanctions against non remittance/under remittance of revenue. The section provides as follows;

Any person who fails to remit funds pursuant to section 23 of this Act commits an offence and shall upon conviction be liable to imprisonment for a term not less than one (I) year or a fine not less than N2, 000,000.00 (Two Million Naira) or to both imprisonment and fine, and shall in addition, remit the full amount so outstanding.  And “Any person who partially remits funds pursuant to section 23 of this Act commits an offence and shall upon conviction be liable to imprisonment for a term not less than six (6) months or a fine not less than NI, 000,000.00 (One Million Naira) or to both imprisonment and fine, and shall in addition, remit the full amount so outstanding.

On the failure to reconcile Consolidated Financial Statements within the six months timeframe provided by the FRA, the amended section also provides sanction as follows; Any person who, without lawful excuse, fails to perform a duty imposed upon or assigned to him or the office which he occupies by this Act commits an offence and shall upon conviction be liable to a term of imprisonment not less than three (3) months or fine not less than N500,000.00 (Five Hundred Thousand Naira) or both fine and imprisonment.

To enforce this provision, the new amendment gives  citizens interested in the fight against corruption, the legal capacity, to enforce the provision of the Act by obtaining prerogative orders or other remedies at the Federal High Court, without having to prove any injury (personal or otherwise) or to show any special or particular interest in the cause of action. The Act also provides that the court shall have the power to, whether under a criminal or civil action brought pursuant to the provisions of this Act, order the recovery of every proceed of corrupt enrichment or wrongful benefit obtained by or conferred on any person from any public revenue, fund or other opportunity that belongs to government. Once again, to put an end to the continuous violation of standards in the use of public resources, well meaning Nigerians should push for the speedy amendment of the Fiscal Responsibility Act.

Victor Emejuiwe



Public Affairs Analyst/Good Governance Expert

Writes from Abuja


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