N4.9trn Unsubstantiated Balances Unaccounted in 2019—Auditor-General

August 19, 2021
Adolphus Arhotomhenla Aghughu Auditor-General

By Adedapo Adesanya

The Auditor-General of the Federation (AuGF), Mr Adolphus Aghughu, has disclosed that the sum of N4.9 trillion cannot be accounted for in the audited accounts of federal Ministries, Departments and Agencies (MDAs) in 2019.

He said this followed the audit carried out by the office on the consolidated financial statement for the fiscal year.

Mr Aghughu made the disclosure when submitting the 2019 audit report to the Clerk of the National Assembly (CNA), Mr Ojo Amos Olatunde, on Wednesday.

The Auditor-General revealed that “from the audit carried out on the 2019 Federal Government Consolidated Financial Statement, unsubstantiated balances amounting to N4.973 trillion were observed.”

“The N4.973 trillion unsubstantiated balances are above the materiality level of N89.34 billion set for the audit,” he further explained.

In auditing, materiality means not just a quantified amount, but the effect that amount would have in various contexts and it is left to the auditor to decide what the level of materiality will be, taking into account, the entirety of the financial statements to be audited.

According to the AuGF, auditing of consolidated financial statements of the federal government on yearly basis would be expeditiously carried out once made available to his office.

He said: “You will recall that on March 25th this year, Audit of Consolidated Financial Statement of the federal government for 2018 was submitted to this office for the required investigation of queries raised in it by the National Assembly. Just five months after, we are here again to make submission of the 2019 Audit Report”.

Speaking further, Mr Aghughu lamented that his office was not performing optimally due to myriad factors crippling its operations and invariably giving room for all forms of financial infractions across the various MDAs.

He explained that, “One of such problems is the absence of Federal Audit Service Law, which is a big challenge as far as effective and efficient public sector auditing is concerned. This is a law that is needed as the basis of fiscal sustainability.

“Absence of it at the federal level is very worrisome going by the fact that some of the states of the federation have the required law in place.”

He also lamented that his office had been incapacitated in so many ways from functioning effectively and efficiently as far as the detection of mismanagement of public funds by the various MDAs was concerned.

“Another problem incapacitating optimal functionality of our mandate as far as thorough and appropriate auditing of financial statements of the MDAs are concerned is gross underfunding, which is telling much on our efficiency.

“For example, the office is understaffed but there is no money for recruitment. Imagine many of our state offices having just two or three staff. Auditing is done by a team not by an individual.

“Accommodation is also part of the problem as our staff in Lagos are about to be evicted from their office due to litigations. These are aside from the problem of insecurity seriously affecting our scope of coverage,” he added.

In his remarks, after receiving the audit report, Deputy Clerk to the National Assembly, Mr Bala Yabani, who stood in for the Clerk, said the report would be submitted to the Clerk for onward submission to both the President of the Senate, Mr Ahmad Lawan and Speaker of the House of Representatives, Mr Femi Gbajabiamila, for the required legislative consideration.

According to him, all the complaints made by the AuGF would be tabled before the leadership of the parliament for required actions and solutions.

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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