THE Federal Capital Territory (FCT) Water Board failed to provide records of contracts worth nearly N1 billion for audit, according to the 2020 report from the Office of the Auditor-General of the Federation (OAuGF).
The audit report released in December 2023 and made available to the public recently disclosed that the board paid over N968.7 million naira to 25 contractors for different services in 2019.
However, the contract records and other relevant documents were not presented for audit, violating several Nigerian laws.
One of the laws violated by this act includes the Public Procurement Act of 2007, which requires that records of procurements be made available to the Auditor-General upon request.
Section 38(5) of the Act states that “the records and documents maintained by procuring entities on procurement shall be made available for inspection by the Bureau, an investigator appointed by the Bureau and the Auditor-General upon request, and where donor funds have been used for the procurement, donor officials shall also have access upon request to procurement files for the purpose of audit and review.”
The 2020 audit, which looked into records of ministries, agency and departments (MDAs) of the Nigerian government, stated that the failure to provide these documents suggested that government funds might have been lost or diverted.
Another issue raised by the audit was a lack of supporting documents for payments worth N37 million by the Board.
According to the report, the Board could not defend a separate payment of N37 million, as no documents back up the amount spent.
“The Board made payments totalling N37,110,031.50 for various expenditures, and the payments were made without attaching relevant supporting documents such as invoices, store receipt vouchers, internal audit certificate, etc.
“The above anomalies could be attributed to weaknesses in the internal control system at the FCT Water Board, Abuja,” the report stated.
This has raised suspicions of possible loss or diversion of public funds. It also raises concerns that payments might have been made for services not rendered.
Other anomalies were recorded during the audit, including non-submission of audited financial statements, award of contracts without due processes and inadequate records on training, among others.
Contracts worth N32.7m awarded without due process
Various contracts were awarded by the board in 2019 without adherence to due process.
“Relevant documents such as tenders, certificate of incorporation, tax clearance certificate, quotations from different suppliers, etc., were not attached to the paid vouchers,” the report stated.
The OAuGF’s report noted that the risks associated with the board’s action include the possible engagement of unqualified contractors or the diversion of government funds.
It is also contrary to the Public Procurement Act, which gives detailed guidelines on the contract award process for government organisations.
Section 19 of the Act states that “subject to regulations as may from time to time be made by the Bureau, under the direction of Council, a procuring entity shall, in implementing its procurement plans: (a) advertise and solicit for bids in adherence to this Act and guidelines as may be issued by the Bureau from time to time;
“(b) to invite two credible persons as observers in every procurement process, one person each representing a recognised; (i) private sector professional organisation whose expertise is relevant to the particular goods or service being procured, and ii) non-governmental organisation working in transparency, accountability and anti-corruption areas, and the observers shall not intervene in the procurement process but shall have right to submit their observation report to any relevant agency or body including their own organisations or associations
“(c) receive, evaluate and make a selection of the bids received in adherence to this Act and guidelines as may be issued by the Bureau from time to time; (d) obtain approval of the approving authority before making an award.”
Inadequate records on training worth N6.3m, unretired N5.3m cash advances
The OAuGF found that the FCT Water Board made payments of over N6.3 million, said to be for the training of some officers. However, during the audit, there was no evidence of this payment or certificates of attendance to show that the expenditure was genuine.
The audit report states that there is the possibility that public funds said to have been spent on this project might be lost or payment made for services not rendered.
There were also cases of unretired cash advances of N5.3 granted for certain projects in 2019, suggesting loss or diversion of government funds.
Both actions contradict paragraphs 603 and 1011 of Nigeria’s Public Sector Financial Regulation Act (2009).
Non-submission of audited financial statements, store items not recorded on ledger
In addition to other violations, the Board failed to submit its audited financial statements from 2018 to 2020 to the OAuGF as provided by the Public Sector Financial Regulation Act.
The Board also failed to record store items purchased through cash advances in the ledger, and there were discrepancies in the dates on the documents provided.
“The dates of the internal audit forms that certify the supply of the items in i) above preceded the date of store receipt voucher,” the report stated.
