Audit reports and tax offenses

THE concept of auditing, according to the Lima Declaration, is the creation of a regulatory system whose purpose is to reveal deviations from accepted standards and violations of the principles of legality, efficiency, effectiveness and savings in financial management early enough to allow corrective action to be taken. In individual cases, have those responsible accept responsibility, obtain compensation, or take steps to prevent – ​​or at least make more difficult such violations. Auditing, being a post-mortem exercise, provides an opportunity to review budget execution with a view to providing information and insights that can be used to course-correct in subsequent budget cycles. However, in Nigeria, the annual audit report was successful in providing a general financial overview of MDAs’ budgetary performance as well as recommendations for corrective action where necessary. Despite the recommendations of the Auditor General’s report, it is regrettable that every year tax offenses of varying degrees are still perpetrated. The Auditor General’s report of 2018 and 2019 reveals another circle of infractions, in the conduct of most government departments and government affairs agencies.

In the 2018 audit report, the issues raised range from non-remittance of N48.55 billion to the CRF. There were also cases of non-deduction/under-deduction/non-remission of statutory taxes and stamp duties of N5.42 billion. The OUAGF observed irregularities in the awarding, execution and payment of contracts amounting to 18.37 billion. The report also recorded irregularities in payments and expenditures amounting to N23.48 billion. Others include violating unregistered N8.39bn store items; cash advances/unreimbursed advances of 354.22 million and circumvention of the procurement process of up to 371.75 million naira in some MDAs. Meanwhile, in 2019, the audit report revealed that the federal government’s consolidated financial statements showed unsubstantiated balances of N4.973 billion. The Federal Government failed to audit its financial report on time and as such a whopping N4.973 billion could not be reconciled. This goes against the provision of the Fiscal Responsibility Act, which states that “the federal government should publish its audited accounts no later than six months after the end of the previous fiscal year.” With the continued violations of MDA tax affairs, it seems that no lesson is being learned from the audit reports. It also means that those tasked with enforcing accountability and probity in the use of public funds are either redundant or also beneficiaries of ongoing poor practices in MDAs. Otherwise, it is expected that the Legislative Committees overseeing the respective indicted MDAs will convene the MDAs to explain why such levels of infractions have occurred and ensure that they comply with the Auditor General’s recommendation. .

ICPC and EFCC should take action and invite officers responsible for MDAs to be interviewed; following the findings of these levels of violation in the Auditor General’s report. With this dereliction of duty, the citizens should demand the amendment of the FRA. The FRA, when amended, recommended penalties for non-payment/underpayment of revenue. The article provides as follows: “Any person who fails to pay funds in accordance with article 23 of this law commits an offense and is liable, on conviction, to imprisonment for not less than one (1) year or a fine of not less than N2,000,000.00 (Two Million Naira) or both imprisonment and fine, and shall further remit the full amount as well And: “Any person who partially remits funds under Section 23 of this Act commits an offense and is liable on conviction to imprisonment for not less than six (6) months or a fine of not less than NI 000,000.00 (one million Naira) or both imprisonment and a fine, and shall further remit the full amount so due.” In the event discrepancy of the consolidated financial statements within the six-month period provided for by the FRA, the amended article also provides for the following sanction: “Any person e who, without lawful excuse, fails to perform an obligation imposed on him or assigned to him a position he holds under this Act commits an offense and is liable, if convicted, to imprisonment for at least three (3) months or a fine of at least N500,000 or both a fine and imprisonment.

To enforce this provision, the new amendment gives citizens interested in anti-corruption the legal capacity to enforce the provision of the law by obtaining prerogative orders or other remedies from the Federal High Court, without having to prove any prejudice (personal or otherwise) or to show any special or particular interest in the cause of action. The Act also provides that the court shall have the power, whether in criminal or civil proceedings brought under the provisions of this Act, to order the recovery of any proceeds of fraudulent enrichment or advantage improperly obtained by or conferred on any person from any public revenue, fund or other opportunity belonging to the government. Once again, to end the continued violation of norms in the use of public resources, well-meaning Nigerians should push for a speedy amendment of the Fiscal Responsibility Act.

  • Emejuiwe, public affairs analyst, writes from Abuja.


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