Nigeria Customs and Institutionalizing the Culture of Fiscal Transparency

Nigeria Customs and Institutionalizing the Culture of Fiscal Transparency

By Abdulsalam Mahmud

Fraudulent activities or dealings only take place in most organisations when transparency and accountability are not regarded as virtues that should be cherished, encouraged and upheld by the management or staff.

It is widely believed, in many quarters, that the absence of accountable, honest and transparent leaders is primarily responsible for the nation’s socio-economic backwardness, over the years.

We are unfortunately blessed with leaders, and public servants, most of whom, like to carry out their statutory obligations and official jobs in absolute secrecy, far away from the prying eyes of the general public.

But such an aberrant culture does neither an organisation boss nor the organisation itself, any good, but rather bad. The Nigeria Customs Service, NCS, as a law-enforcement agency, is also saddled with the responsibility of generating revenue to properly run the affairs of governance.

Since money is the main card on the table, the NCS is not leaving anything to chance in ensuring that it dots the “I”s and cross the “T”s of its books. For Bashir Adewale Adeniyi, the Comptroller General of Customs, CGC, the NCS’ commitment to promoting transparency in its financial statements, remains unflinching.

This, according to him, is aimed at fostering the efficient auditing of all Customs’ accounts. Adeniyi made this known when he appeared before the House of Representatives’ Public Accounts Committee, PAC, some few days ago.

According to the Customs helmsman, their NCS has been using integrated technology to collect revenue for over 20 years, noting that more than 20 commercial banks are involved in the process.

He mentioned that the Service entered into a contract with the aforementioned banks, and was granted access to a technology platform that allowed them to collect the payments. He further stated that the fund is remitted directly by the banks to the federation accounts.

While speaking further, Adeniyi promised to collaborate closely with the Reps’ Committee, saying, “Compliance is something we take seriously, and we will ensure that if there are any grey areas that need our service to foster efficiency, I am happy to mention that my team and I are prepared and will in the most transparent manner, present statements to the Committee.”

Responding, Chairman of the Public Account Committee, Hon. Bamidele Salami, advised that NCS always provide an audited statement of accounts and adhere to all legal requirements.

While the Nigerian Customs is wary of not effectively auditing its accounts, some of its sister federal agencies do not. In June 2020, a news report disclosed that the Nigerian National Petroleum Corporation Limited (NNPCL) “made history” with the publication of its first audited financial statements. This came 43 years after the company started operation.

In February 2017, the Fiscal Responsibility Commission, FRC, then accused the same NNPCL of failing to audit and submit copies of its audited financial statements to it since 2010, as required by the FRC Act, 2007.

Then Acting Chairman of the FRC, Chief Victor Murako, made the accusation at a meeting called by the commission to discuss various contraventions of the Act by the oil corporation. He also accused the NNPC of failing to submit its quarterly revenue profiles and annual budgets since 2012.

According to Murako, NNPCL repeatedly failed to respond to correspondences, especially after the last submissions made for the 2009 financial year in July 2012. “The NNPC has also failed to submit its quarterly revenue returns since 2010. All efforts to ensure compliance through letters and phone calls proved abortive, despite the fact that two desk officers were appointed by the NNPC to liaise with the commission.

“The NNPC, however, in November 2015, responded to the request for submission of documents. This is a clear indication that the documents submitted are grossly inadequate and fall short of the compliance with the provision of the FRA 2007 and international best practices.”

He added, “The last approved audited financial statement submitted by the NNPC was for the 2009 financial year. What was submitted for 2010–2014 is a one page summary financial report extracted from the Draft Financial Statements and Management Accounts.

“It is very clear that the NNPC has not prepared and/or audited its financial statements in the last six years, which is a violation of Section 23 (3) of the FRA 2007. This section requires all scheduled corporations to prepare and publish approved annual audited financial statements not later than three months after the financial year.

Similarly, a review of Nigeria’s 2019 audit report by Dataphyte revealed that Nigerian Ministries, Departments and Agencies, MDAs, spent monies running into trillions of naira without appropriation or financial transparency.

According to the audit report, the MDAs’ collectively were unable to account for at least N2.5 trillion.

Without mincing words, a flawed internal audit system is one major factor contributing to the alarming increase in corruption cases at our federal MDAs.

However, the Federal Government of Nigeria (FGN) must be commended for establishing Internal Audit functions in all the Ministries, Extra-Ministerial Offices, and Agencies as part of their internal control and governance structures where the Accountant General of the Federation is responsible for posting Directors/Heads of Internal Audit, in line with paragraphs 1701 & 1702 of the Financial Regulations, 2009.

As “the first line of attack” against corruption, the FG should consider it necessary to strengthen the internal audit functions across MDAs. It will go a long way to entrench public accountability that will midwife governance.

On one hand, corruption scandals thriving in some government agencies cannot just be checkmated without a robust financial management system. It is what the Nigeria Customs and some few other agencies adopted. Hence, the putrid smell of graft seldom oozes out of their ‘buttholes’.

Mahmud is the Deputy Editor of PRNigeria, and wrote in via: [email protected].