Audit Report Uncovers N13.95 Trillion Illegal Withdrawals by Nigerian MDAs

The 2020 audit report has exposed illicit withdrawals totaling N13.95 trillion by various federal Ministries, Departments, and Agencies (MDAs) in Nigeria. The report, released by the Auditor-General of the Federation (AuGF), Shaakaa Chira, highlighted the involvement of twenty-eight MDAs in these unauthorized transactions, as detailed in the Consolidated Financial Statement.

The findings of the audit report unveiled a gross violation of the Financial Regulations 2009, which strictly prohibits government bank accounts from being overdrawn or obtaining temporary advances from banks. According to the report, the MDAs maintained negative balances amounting to N13.95 trillion, a breach that could potentially lead to substantial financial consequences for the government.

Leading the list of defaulting MDAs was the Federal Ministry of Environment, which overdrew N350.85 billion, followed by the Nigeria Stored Products Research Institute and the Public Complaints Commission. Notably, the Federal Pay Offices in Uyo, Benin, and Ilorin were among the entities with the lowest balances.

AuGF Shaakaa Chira expressed grave concern over the lack of approvals or explanations provided by the MDAs regarding these overdraws. He attributed the irregularities to weaknesses in the internal control system surrounding the consolidation process at the Office of Accountant-General of the Federation, emphasizing the urgent need for corrective measures to prevent further financial mismanagement.

Further scrutiny through the Government Integrated Financial Management System (GIFMIS) revealed that some withdrawals were allocated to personnel and overhead financing, as well as bank charges related to the Central Bank of Nigeria (CBN) gateway. This discovery raised questions about the effectiveness of the Treasury Single Account (TSA) initiative.

In response to the discrepancies, AuGF Chira proposed several measures, including budgetary provisions to cover service charges on MDAs for utilizing the CBN gateway. He also recommended forwarding transaction schedules and bank statements of the affected MDAs to the Public Accounts Committee of the National Assembly for review and urged the application of sanctions prescribed in the Financial Regulations.

Development Expert Adenike Aloba weighed in on the matter, advocating for the empowerment of the auditor-general beyond mere audit recommendations to address financial misappropriations effectively. Aloba emphasized the importance of passing the Nigeria Audit Service Bill 2022, which seeks to bolster the authority of the auditor-general in safeguarding public funds and enhancing financial regulatory mechanisms.

Despite the passage of the bill in the House of Representatives, its fate in the 9th Senate remains uncertain, highlighting the pressing need for legislative action to fortify accountability measures and combat financial malpractice in Nigeria.