The Nation Newspaper

Tag: audit

  • ‘Oil, gas sector earnings audit report out soon’

    ‘Oil, gas sector earnings audit report out soon’

    The audit report on oil and gas sector earnings for 2013 would be made public before the end of  this year, the Nigeria Extractive Industries Transparency Initiative (NEITI),  has said.

    The audit is expected to establish how much money  the country earned from the oil sector within the period and bring to the lime light how much crude oil that was produced and how much of it was exported within the given time.

    Again, the report would  explain the processes used to manage the revenues that accrued to the government from from the oil and gas sales and how the revenues were managed. On the other hand, it would give specific answers to how much the country earned from petroleum profit tax, royalty, grants and concessions.

    NEITI Director of Communications,  Ogbonnaya Orji, in a telephone interview, said the report would also be able to make the difference between what the government received from oil and gas revenue and from all other sources and what the companies actually paid.

    He said: “We will establish from the audit if there was a difference between what companies said they paid in terms of tax, royalty, and other revenues and then find out if what they said they paid was what the government said they received or if there was a  variance.

    “We will also find out if companies paid what they were supposed to pay and if the government received what it is supposed to receive because in the past, companies had made claims that they paid so much while the government would say it received so little; we want to find out if that gap exists,” he said, adding that the report would establish if there were cases of over payment or under assessment of taxes.

    He said as soon as the report is ready, it would be made public to the media, civil societies, members of the National Assembly, adding that it would be used to ask informed questions and initiate debate that would help ongoing reforms in the sector.

    While commending the recent publication of financial statement by the Nigerian National Petroleum Corporation (NNPC), he urged the  oil firm to be more  transparent and accountable adding that its activities needed to be more in the public domain.

     

    He said there was the need for the NNPC to share more information on the internal reforms that are going on currently.

    “It needs to be faster and again there is the need for more information on what has been done and what needs to be done”, he uttered

    “We need them to support their information and communication department to come out almost weekly or monthly to brief Nigerians on what exactly is going on within the organization. For the reason that over 70 percent of the country’s revenue is coming from that organization, if anything goes on well with the NNPC it largely affects the wellbeing of Nigerians, and if anything goes wrong it will also affect them adversely”

    The NEITI boss has also stressed the urgent need for the government to exploit the huge potential in the mining sector

    He said as the oil price has collapsed globally it is high time Nigeria paid more attention to the mining sector adding the country can no longer depend on oil

    He said there were abundance of gold, diamond, copper, limestone and all sorts of solid minerals available in every nooks and cranny of the country waiting to be harnessed

    He urged the government to come out with a comprehensive policy and work closely with the NEITI recommendations on information and data that we have collated that are available in the mining sector expressing the hope that the federal government would appoint an experienced minister to take over the solid mineral sector

    Orji informed that a lot of illegal mining were going on especially in the northern part of the country where according to him are very rich in these solid minerals

    “Our concern is that most of these minerals are exploited illegally by foreigners and nobody seems to be paying attention”

    Meanwhile, he expressed the commitment to be bold in its efforts to continue to inform Nigerians on whatever that is going on not only in the NNPC but also in the mining sector

     

     

  • Expert urges produce audit to avert exports rejection

    Chairman Board of Trustees, Mycotoxicology Society of Nigeria, Prof Dele Fapohunda,  has  urged  the  government to  improve  on exports  standards and ensure commodities  meets European Union (EU) requirements for import.

    He said the rejection of some of Nigeria’s exported food items by the EU is not only detrimental to the agricultural sector, but is also counterproductive to the economy.

    He was addressing a workshop organised by the Raw Materials Research and Development Council in Abuja.

    He said beans, sesame seeds, melon seeds, dried fish and meat, peanut chips and palm oil from Nigeria have been banned by the EU till June, next year, which the reason given were aflatoxins and pesticides at unacceptable levels.

    According to him, plans to make the agricultural sector a major revenue earner for the country may suffer a setback if produce from the industry are being rejected by foreign countries.

    He said local exporters were at the risk of suffering losses since imports are significantly protected by the high standards of the major food suppliers and retailers, and the regulatory controls which deter the importation of seriously contaminated material.

    Stringent mycotoxin standards on exported food crops, he noted, countries must export their best-quality foods while keeping contaminated foods away.

    For Nigeria to make remarkable agricultural progress, he said further action is required to address new and emerging contamination challenges.

    Going forward, he said Nigeria needs to improve its policy environment, to enable investments that will allow help exporters to adapt to the opportunities created by rising export demand.

    As increasing agricultural exports is now an integral part of the government’s sector-development strategy, Fapohunda said the government should help exporters to streamline exports with the ever-changing food quality and safety norms of major importing countries. According to him, there  have been concerns over pesticide residues in horticultural produce.

    As result, he  said  the  food industry has to deal with various intrinsic issues impacting food quality and safety across the supply chain.

    To further harness the potential of the agriculture and food industry, he said robust policy strategies on food quality and safety  are  imperative to improve standards and secure greater market access of food products in the developed markets.

  • SEC begins capital market firms’ audit

    The Securities and Exchange Commission  (SEC) would soon launch comprehensive investigative audits of capital market firms as part of post-recapitalisation process with a view to ascertaining the veracity of assets of the firms.

    SEC at the weekend released a provisional list of 972 firms that have been cleared to operate in the capital market after the Commission drew the curtain on a two-year recapitalisation.

    The list included 437 capital market operators that were cleared to have met the new minimum capital requirements by the September 30, 2015 deadline, nine other operators that were in the process of merging into four companies, six self-regulatory organisations and a long list of 525 capital market consultants and experts.

    The Commission confirmed that the list was a provisional list noting that the final list of registered and certified capital market operators would be made public after capital verification. SEC stated that it would be engaging audit firms, without providing further details.

    A source in the know said the Commission plans to conduct stress and impairment tests on the assets filed in by the capital market firms and to further confirm the authenticity of the claims by the firms.

    The source said top on the list of accounting firms being considered by the Commission were KPMG and Akintola Williams Deloitte adding that the Commission decided on the investigative audits to avoid the repeat of bubble assets that undermined the previous recapitalisation exercise, especially in the banking and insurance sectors.

    Among the capital market operators that retained all their registered functions included GTI Capital Limited, issuing house; GTI Securities, broker/dealer; Capital Assets, broker/dealer, issuing house and fund/portfolio manager; Cowry Asset Management Limited, venture capital manager, corporate investment adviser and issuing house and Cowry Securities Limited, which retained its dual functions as a broker/dealer.

    Also, all members of Meristem Group retained their functions including Meristem Registrars, Meristem Securities, Meristem Stockbrokers, Meristem Trustee and Meristem Wealth Management Limited.

    Others included Access Bank, Africa Prudential Registrars, Afrinvest West Africa Group, Akintola Williams Deloitte, APT Securities And Funds, Capital Bancorp, Chapel Hill Denham Management Group, Citi Bank Nigeria, Diamond Bank, Ecobank Nigeria, FBN Capital, FCMB, Fidelity Bank, First Bank of Nigeria, Flobal Trust, FSDH Group, Guaranty Trust Bank, Heritage Bank, JAIZ Bank, Lotus Capital, Phillips Consulting Ltd, Pricewaterhouse Coopers, Rand Merchant Bank Nigeria,              Skye Bank, Stanbic IBTC Group, Standard Chartered Bank, Sterling Bank, Trust Yields Securities,  United Bank for Africa, Union Bank of Nigeria, United Capital Group, Unity Bank, Vetiva Capital Management Group, Wema Bank and Zenith Bank Plc, among others.

    SEC in December 2013 announced major increases in minimum capital requirements for capital market functions under a new minimum capital structure that was initially scheduled to take off by January 1, this year., 22015. It however extended the deadline to September 30, 2015.

    Minimum capital base for broker and dealer was increased by 329 per cent from the existing N70 million to N300 million. Broker, which currently operates with capital base of N40 million, will now be required to have N200 million, representing an increase of 400 per cent. Minimum capital base for dealer increased by 233 per cent from N30 million to N100 million.

    Also, issuing houses, which facilitate new issues in the primary market, will now be required to have minimum capital base of N200 million as against the current capital base of N150 million. The capital requirement for underwriter also doubled from N100 million to N200 million. Trustees, rating agencies and portfolio and fund managers had their minimum capital base increased by 650 per cent each from N40 million, N20 million and N20 million to N300 million, N150 million and N150 million respectively. A  Registrar will now have a minimum capital base of N150 million as against the current requirement of N50 million. While the minimum capital base for corporate investment adviser remained unchanged at N5 million, individual investment advisers will have to increase their capital base by 300 per cent from N500,000 to N2 million.

     

     

     

     

     

  • Audit of airlines

    Audit of airlines

    • NCAA should handle this task as routine

    How often does the Nigerian Civil Aviation Authority (NCAA) audit airlines in the country? This is the question that some Nigerians have been asking since the crash on August 12, of a Bristow helicopter in Lagos. Six persons aboard the Sikosky 76 helicopter marked 5N-BGD, which plunged into the lagoon died, while six injured ones were rescued by divers.

    Immediately after, NCAA’s director-general, Capt. Muhtar Usman, ordered i commencement of the safety audit of all the airlines. Usman said this was in line with the authority’s regulatory and oversight responsibilities, adding that the authority’s Aviation Safety Inspectors (ASI) would continue to intensify the routine ramp inspections. Indeed, virtually all the NCAA boss said could be taken that the authority has not been doing enough to ensure safety on our airspace. For instance, if the authority had been carrying out its assignment as routine, Usman did not need to warn pilots to take precautionary measures during adverse weather conditions by ensuring strict compliance with states’ weather minimal and Standard Operating Procedures (SOP).

    Moreover, Captain Usman should not have reminded us that the authority would continue to ensure intolerance for non-compliance to regulations  or that airline business in the country would be done according to the standard and Recommended Practices (SARPs) so as to ensure safety and security.

    Indeed, it was for all these reasons that some aviation experts carpeted the authority for making an issue of something that should be routine. A former managing director of IRS Airlines, Yemi Dada, said the NCAA’s announcement of the audit after the helicopter crash was self-indicting; and that it was a way of admitting that it had not been doing its job well. He added that the announcement was capable of causing panic among air travellers. “I believe that the announcement is not necessary. It could lead to panic. However, we cannot blame the agency for doing its work. If you have been doing your work effectively and efficiently, there would not be any reason to make the announcement,” he said.

    However, by alluding to regular audits, we are not just concerned with the technical aspect but also the economic dimension of airline operations. They go together. It is obvious that all is not well with the country’s aviation sector. Many of the airlines in the country are financially insolvent. Nearly all of them are owing major aviation agencies, including the NCAA, the Federal Airports Authority of Nigeria (FAAN) and the Nigeria Airspace Management Agency (NAMA) over N13billion in Ticket Sales Charges. This situation births desperation, which compels the operators to unethical practices. They are bound to cut  corners to keep the airlines afloat.

    There is also the problem of corruption that is paralysing every sector of the economy. For instance, a few years ago, the airlines received huge sums as bailout funds from the Federal Government to enable them improve their operations. No one is sure what many of them did with the funds, which apparently implies that they saw the money as free funds.

    There are enough justifications for the NCAA to beam its searchlight on the economic audit of the airlines to be sure that only the financially healthy ones are allowed to operate. We will only be inviting trouble for the air passengers if we allow flying coffins in our airspace.

    We urge the Accident Investigation Bureau (AIB) to conduct a thorough investigation into the crash, with a view to giving an insight into its cause. The government also must be ready to provide the NCAA and other agencies in the aviation sector the required assistance to recruit adequate manpower and procure the tools needed to facilitate their operations.

    “There are enough justifications for the NCAA to beam its searchlight on economic audit of the airlines to be sure that only the financially healthy ones are allowed to operate. We will only be inviting trouble for the air passengers if we allow flying coffins in our airspace.  We urge the Accident Investigation Bureau (AIB) to conduct a thorough investigation into the crash, with a view to giving an insight into its cause.”

  • FAAN passes safety audit

    FAAN passes safety audit

    Federal Airports Authority of Nigeria’s (FAAN) workers have been hailed for enabling its authority to score “93.3 per cent” during the just concluded Aviation Security Audit.

    FAAN’s Managing Director Saleh Dunoma gave the commendation during an interaction with airport operators in Lagos.

    The Airport Excellence (APEX) in safety audit was conducted at the Murtala Muhammed International Airport (MMIA), Lagos and Nnamdi Azikiwe International Airport, Abuja.

    Dunoma said he invited the Airport Council International (ACI) in line with the authority’s mandate for a safe and secured airport environment.

  • Benue to embark on staff audit

    Benue State government is to carry out an audit of its workforce before the payment of June salary.

    Governor Samuel Ortom, who spoke yesterday when the forum of former local government chairmen visited him at the Benue Peoples House, said the exercise became necessary following the need to flush out ghost workers.

    He said financial leakages would be blocked to ensure prudence.

    The governor said his administration would use the loan it would obtain to pay two months salaries.

    Ortom said his government would also use the loan to tackle challenges, such as accreditation of programmes at the College of Health Sciences of the Benue State University (BSU), Makurdi, take-off of the House of Assembly and other government business.

    He told members of the forum that his administration would follow due process in its dealings, stressing the need for them to cooperate with it to succeed.

  • ASUU urges members to ignore audit

    The Academic Staff Union of Universities (ASUU) has directed its members to ignore a letter from the Budget Office of the Federal Ministry of Finance asking members of the union to present themselves to an audit panel.

    In a letter from the union’s national secretariat signed by its President, Dr Nasir Fagge, and addressed to all chairpersons, the union described the action as illegal and against the principle of university autonomy.

    The letter titled: “Re: Staff Audit – Federal Ministry of Finance”, reads:  “The attention of the Union has been drawn to a letter dated 26th May, 2015 from the Budget Office in the Federal Ministry of Finance directing members of our union at the University of Abuja to appear before a Staff Audit Committee of the Ministry.

    “The directive is a breach of the ASUU/FGN 2009 Agreement and an attempt to compromise the universally accepted AUTONOMY of the university system.

    “Our members are, therefore, directed not to appear before any such committee panel on Staff Audit in all the universities. It is the Governing Councils of universities that can, without prompting from the government, take and implement decisions on staff audit or budgeting issues in universities.”

  • ICAO begins safety audit of Nigeria today

    A team of aviation safety auditors from the International Civil Aviation Organisation (ICAO) arrived in Lagos yesterday to begin the Universal Security Audit Programme on Nigeria from today.

    The safety audit will run for about nine days and terminate on  June 9.

    The Director General of Nigerian Civil Aviation Authority (NCAA), Captain Mukthar  Usman, said the team will look at Nigeria’s regulatory framework and national civil aviation security systems, training of aviation security personnel, quality control functions, airport operations and aircraft and in-flight security.

    Other areas the team will look at include: passenger and baggage security, cargo, catering and mail security, response to acts of unlawful interference and security aspects of facilitation.

    He listed the members as: Karen Zadoyan, Steven Neu, Nuno Miguel Silva Ferreira Fortes and Wendy Mueller.

    Usman said the objective of the audit is to determine a country’s capability for security oversight by assessing the implementation of the critical elements of security oversight system.

    “Thereafter, recommendations will be provided for contracting states to improve their security systems and oversight capabilities,” he said.

    He, therefore, reiterated his call on all stakeholders in the industry to join hands with the authority to ensure another successful outing similar to the audit of 2008.

    The NCAA boss said:”In our preparations, adjustments have been made in some areas. These are response to ICAO’s compliance checklist, state aviation security activity questionnaire, state corrective action plan (CAP) and review of all relevant NCAA aviation security documentation, which includes the National Civil Aviation Security Programme.

    Others are National Civil Security Training Programme, National Civil Aviation Security Quality Control Programme and Scheduled Inspections, Surveys and Audits of Airports nationwide.

    The NCAA is the nation’s statutory regulatory authority responsible for the development, implementation and maintenance of National Civil Aviation Security Programme (NCASP).

  • NNPC’s forensic audit

    •FG should publish the report in full if it has nothing to hide

    For a corporation long known to be inured to shame and probity, it comes as no surprise that the Nigerian National Petroleum Corporation (NNPC) would mount an orgy of self-exculpation barely hours after the Auditor- General of the Federation, (AuGF), Samuel Ukura, made public the highlights of the PriceWaterHouse Coopers (PwC) forensic audit report on the alleged missing $20 billion. Not even a key highlight of the PwC report asking NNPC and its subsidiary, the Nigerian Petroleum Development Company (NPDC) to refund “a minimum of $1.48bn,” to the Federation Account, it seems, could suffice to temper the corporation’s mission in self-justification and image laundering.

    By the way, were the NNPC to be any guilty of the aforementioned, the Jonathan administration would be just as complicit for allowing the corporation to go public with the cherry-pick even as Nigerians are denied the opportunity of seeing the entire document.

    To be sure, the PwC can claim to have delivered on its mission of investigating the shortfall in remittances to the Federation Account as alleged by the former Central Bank of Nigeria (CBN) Governor Sanusi Lamido Sanusi. What remains at issue is whether the process – from duration to the point of submission – has resolved the riddle of the missing $20 billion.

    We have no difficulties in stating the obvious – which is that the entire process is, as would be expected in the circumstance, highly disappointing. To start with, it is worth noting that the report is actually coming four months late. Given that the Minister of Finance, Ngozi Okonjo-Iweala had stated in April last year that the firm had 16 weeks to do the job, the report ought to have been submitted last September. Without the relentless pressure mounted by various segments of the Nigerian society, it seems unlikely that the report which the administration is now so eager to claim some credit for would have seen the light of the day. That the administration finally caved in would owe in part to the fact that the general elections are only a few weeks from now; and the nigh impossibility of being able to fob off questions about the scandal.

    Of greater interest to us however is what President Goodluck Jonathan has chosen to do after receiving the report. Ordinarily, given the intense public interest generated in the wake of the allegations, we would have expected the administration (ever so eager to prove that it had nothing to hide) would cause the findings to be published to enable citizens – at whose behest the investigation was undertaken – draw their own conclusions. Rather, the President opted to hand the report to the AuGF with a directive to the latter to publish its highlights.

    The point really is that things have gone beyond the attempt to cherry-pick the report. Asking the AuGF to do what is no more than an executive summary, aside being opportunistic, is hardly helpful to the cause of establishing the truth. Moreover, audit reports are by their nature public documents. Why the Jonathan administration would choose to treat it as a matter covered by the Official Secrets Act is hard to comprehend; just as the notion that Nigerians cannot comprehend let alone draw their independent conclusion is absurd.

    As for the order by Minister of Petroleum Diezani Alison-Madueke to the NNPC to pay the outstanding $1.48 billion due to the Federation Account, we consider it superfluous and utterly condescending. Clearly, the magisterial directive merely confirms what is today known as the farce going on at the petroleum ministry where the minister doubles as sole administrator. Until the nation is availed the entire PwC report, we would expect the NNPC and the petroleum ministry to spare Nigerians the distractions.