Financial Reporting Council paid N66m for office rent without occupying it — Audit report

The Senate Committee on Public Accounts has uncovered how the Financial Reporting Council of Nigeria paid N66 million for two-year office rent without occupying the building. The committee, while considering a 2018 report of the Auditor-General for the Federation, also discovered how the agency used 64 vouchers to siphoned N28 million. Mike Tyson, Evander Holyfield […]

The Senate Committee on Public Accounts has uncovered how the Financial Reporting Council of Nigeria paid N66 million for two-year office rent without occupying the building.

The committee, while considering a 2018 report of the Auditor-General for the Federation, also discovered how the agency used 64 vouchers to siphoned N28 million.

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The Council is responsible for setting and promoting compliance with standards for accounting, financial reporting and auditing in Nigeria.

The Chairman of the committee, Senator Matthew Urhoghide, during the panel’s hearing on the report, said the breakdown of the N66 million showed that the FRA paid N42 million for rent and N23.4 million as a legal fee.

He said after payment, the agency was yet to move into the building four months to the expiration.

The alleged financial malfeasance occurred during the tenure of Jim Obazee as Executive Secretary of the Council, according to the report.

The report reads: “It was observed that on 21/11/16 the sum of N42 million was paid as rent to Japaul Oil and Maritime Services for office space at Japaul Building. N23.4 million was paid to Sola Oluseyi & Co, as legal and agency fee for the office space, making a total of N66 million for two years ending 1/1/2019.

“The Council is yet to move into the building, twenty (20) months running with 4 months to its expiration.

“This anomaly was due to the failure of the Executive Secretary to exercise due diligence in the application of public funds by ensuring that value is received for money expended.

“The Council may carry out the expenditure of such magnitude and yet fail to receive value.

“Huge sum of money was paid for rent by the Council, but failed to occupy the building, this amounts to a waste of government resources.”

But the agency, in its written response, said upon the acquisition of the office accommodation at the Japaul House, there was a need to give the property a face-lift including partitioning befitting of an office.

However, there was a change of Executive Secretary in 2017, which slowed the process of award of contract.

“Secondly, the landlord was not willing to renew the tenancy agreement after the expiration of the current agreement.

“The Management further remarked that the Council is taking steps to utilize the building and secure a further lease from the Landlord.”

Also in another audit query reads, “During the audit, it was observed that 64 payment vouchers for the sum of N28,765,842.11 were raised and paid without the Internal Audit stamps and dates, in contravention with the provisions of extant laws and regulations.

“This infraction was due to the failure of the Executive Secretary to strictly comply with the provisions of law and laid down procedures aimed at strengthening the internal control system in government agencies.”