FG orders audit of WAEC, NECO, other funded agencies over discrepancies.

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Owing to financial discrepancies noted in the books of the two examination bodies for secondary schools in the country, the federal government has ordered a “Special Audit” of their books and that of other government funded agencies to get a clearer picture of their expenses.

President Muhammadu Buhari gave the approval for the special audit of these bodies and others agencies according to a source who said government wants to “look  into the expenses, printing costs (considered very high), revenue sharing contracts and other irregularities which are suspected of these government funded bodies.”

The Special Audit he said is part of government’s “efforts to focus on non oil revenues generated by government through its board and agencies which is not accounted for and therefore resulting leakages.

For instance in WAEC, it’s salary/overhead capital from the federal government of Nigeria totaled N4.8 billion representing 100 percent funding by the federal government.

The 2014 account of the examination body showed its Internally Generated Revenue (IGR) from fees made from public sale of forms and other examination materials stood at N16.6 billion.

“What prompted the federal government’s interest in WAEC was that “all its IGR were spent on examination costs with very high charges for printing, travelling etc resulting in lots of waste and fraud” said the source.

To make matters worse, “just N25 million was paid into the Consolidated Revenue Fund (CRF)” the source said.

NECO is another examination body that received N4.9 billion representing 100 percent funding of its activities.

The same year, NECO was said to have generated an IGR of N11.7 billion but “the same story all over again with almost all the money spent and just N6.9 million remitted the to CRF.

The audit purpose on these examination bodies is to unearth all financial irregularities with a view to making them remit more to the CRF as well as boost government’s revenue base outside crude oil sales.

Kemi Adeosun, the Minister of Finance, last week issued a circular on guidelines regarding budgeting, revenue and expenditure aimed at ensuring that Ministries Departments and Agencies (MDAs) remit revenue and generate operating surpluses which by law ought to be credited to Consolidated Revenue Fund (CRF).

The circular is aimed at compelling Boards and Agencies who currently operate outside of budgetary control to comply with the laws of Sec 22(2) of the Fiscal Responsibility Act (FRA) which lists agencies like the NPA, NIMASSA, NAFDAC, JAMB, NTA, NCC, CAC, NECO, to remit 80 percent of their operating surplus into the Consolidated Revenue Fund.

The Minister of Finance had lamented that “records show very poor compliance with the provisions of the Fiscal Responsibility Act. Some agencies have never credited the Consolidated Revenue Fund despite having salary, capital and overhead financed by the Federal Government. Indeed, cost to income rates of 99.8 percent have been the average, meaning that they spend all their internally generated revenue and subventions released to them.”

The Minister said such practices are not sustainable in any economic climate and with the current serious economic challenges being faced by Nigeria, “this can no longer be tolerated. Accordingly, all revenue generating agencies must comply with the circular and cut their costs.”

In the circular sent to MDAs, the Minister said “revenues generated by all Ministries, Departments and Agencies (MDAs) must be reported on a gross basis prior to any deductions. Also, all self funded Federal Agencies are to limit their annual expenditures from their internally generated revenues to not more than 75 percent (Seventy Five percent) of their total gross revenue, while fully funded agencies are to remit all their internally generated revenue (IGR) to the Consolidated Revenue Fund (CRF).”

The Circular added that “henceforth, 80 percent of the resulting operating surplus by MDAs should be remitted into the Consolidated Revenue Fund (CRF) on a quarterly basis, in accordance with the Fiscal Responsibility Act.”

To ensure sustained and regular monitoring of the financial activities of MDAs, the circular required “all MDAs funded through the annual budget must submit monthly Expenditure Transcripts and Revenue Returns, to the Office of the Accountant-General of the Federation (OAGF), while agencies not funded through the annual Federal Government budget are to prepare and submit Quarterly Management Accounts including Revenue Returns to the OAGF”

The Minister warned all MDAs “that in line with Financial Regulations (FR) 107, the Accountant-General of the Federation will carry out routine revenue monitoring and inspection visits to the MDAs to verify compliance with the new guidelines. The circular said any Accounting Officer/Chief Executive Officer of MDAs that defaults in remitting revenues as appropriate and as when due shall be sanctioned accordingly and the renewal of the tenure of appointment of Accounting Officers/Chief Executive Officers shall be tied to their compliance with the content the new guidelines.”

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