Audit of MDAs reveals N4.97tn unaccounted for in 2019

The Auditor General of the Federation (AuGF) Adolphus Aghughu, has bemoaned the unhealthy financial status of audited accounts of federal Ministries, Departments, and Agencies (MDAs) in 2019.

According to Aghughu, unsubstantiated balances totalling N4.973trillion were observed by his office in the audit carried out on the consolidated financial statement for the fiscal year.

The AuGF made this disclosure on Wednesday while submitting the 2019 Audit report to the Clerk to the National Assembly (CNA) Ojo Amos Olatunde.

He further explained that an inability to institute a thorough forensic investigation was due to the incapacitation of his forces by various factors.

“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 are concerned. This is a law that is needed as 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.

“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.

Read also: Senate threatens to release list of MDAs who refused audit into accounts, expenditure

“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 problem of insecurity seriously affecting our scope of coverage,” he said.

He also revealed that” from the audit carried out on the 2019 Federal Government Consolidated Financial Statement, unsubstantiated balances amounting to N4.973trillion were observed

“The N4.973 trillion unsubstantiated balances are above the materiality level of N89.34 billion set for the Audit ”

In auditing, materiality means not just a quantified amount, but the effect that amount will have in various contexts. During the auditing planning process, the auditor decides what the level of materiality will be, taking into account, the entirety of the financial statements to be audited.

Aghughu further noted: “You will recall that on the 25th of March this year , Audit of Consolidated Financial Statement of the Federal Government for the 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”.

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