Issues in the 2017 auditor-general’s report

The long-awaited 2017 Auditor-General’s report was recently published in the website of the office of the auditor general.  This is in line with the provisions of Section 85(3) (b) of the 1999 Constitution which require that the Annual Accounts and Auditor’s reports of government parastatals should be submitted to the Auditor-General of the Federation for comments. However, the last report produced by the auditor-general on the Ministries, Departments and Agencies was in 2016. The Auditor-General had complained that government MDAs were not complying with the provisions of the law that mandate them to submit their annual audit reports not later than May 31 of the following year.

In his 2016 report, the Auditor-General complained that “most of the government corporations, companies and commissions have not submitted their audited accounts for 2016 to me. From that report “as of April 2018, 109 agencies had not submitted (their audited accounts) beyond 2013, 76 agencies last submitted for the 2010 financial year while 65 agencies have never submitted any account since inception. This same scenario, even worse repeated itself as shown in the 2017 audit report, as the Auditor-General re-affirmed that as  of June 30, 2019, 160 agencies defaulted in the submission of audited accounts for 2016; 265 agencies defaulted in submission of audited accounts for 2017; while 11 agencies had never submitted any financial statements since inception.

Some of the issues raised in the 2017 report included the delay of the passage of budget and how it affected the MDAs in the implementation of projects. A summary of the report shows a lack of revenue remittance by some revenue generating agencies of government. According to the report, the MDAs that deduct the statutory Withholding Taxes, Value Added Taxes, Stamp Duty, Capital Gains Tax and other statutory taxes did not carry out their duties appropriately to the benefit of the Federal Government, thereby leading to a significant reduction in revenue accruable to the Federal Government. It further stated that 16 revenue generating agencies did not remit a total of N19,025,384,100.29 to the Consolidated Revenue Fund, with the Bureau of Public Enterprise topping the list of unremitted revenue, with the sum of N7,585,116,400.00.

 We also found that revenue generating agencies dissipate funds on excessive overhead expenditure and extra-budgetary expenditure on contracts thereby reducing their operating surplus. Furthermore, 26 of the MDAs that were audited did not deduct and/or remit a total of N1,650,417,379.30. Overall, the audit found that the sum of N20,675,801,479.59  in various taxes (PAYE, WHT, VAT, etc.) in the year under review, was not remitted to the Consolidated Revenue Fund of the Federal Government by the MDAs.

From the findings in this report, government revenue drive from taxes will not yield any positive impact if agencies of government saddled with this responsibility are not remitting accrued revenue to the consolidated revenue fund. The recent finance bill shows government’s drive through the Federal Inland Revenue Service to expand the tax net by mandating all Nigerians to pay tax. However, if these funds generated from tax are not properly accounted for, it will betray the confidence of the Nigerian citizens to cue into the tax net. The report also shows failure of the MDAs to comply with circulars from the Accountant/Auditor-General on policies that will ensure probity and accountability. The passage of the audit bill will provide sanctions for erring public officers.

President Muhammadu Buhari should quickly assent to the audit bill, as this will address some of the issues raised by the Auditor-General.

Victor Emejuiuwe,