Explain ₦210tn NNPC discrepancy in one week, Senate tells auditors

Nigeria's Senate Public Accounts Committee has issued a stern one-week ultimatum to the external auditors of the Nigerian National Petroleum Company Limited (NNPC). The auditors must provide a detailed breakdown of over ₦210tn that appears in the company's audited financial statements but remains unexplained.

Lawmakers are intensifying their scrutiny of the state-owned oil firm, focusing on significant discrepancies. These include approximately ₦107tn classified as receivables and another ₦103tn recorded as payables. The Senate has repeatedly questioned these large balance sheet entries, noting that neither NNPC Ltd. nor its auditors have satisfactorily reconciled the transactions behind these figures despite previous engagements.

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When you have figures in the financial statements, there must be supporting schedules showing how those figures were arrived at. If you already have them in your working papers, why do you need to go back before presenting them to this committee?

During a hearing on Wednesday, representatives from the external audit firm requested about two weeks to retrieve supporting documents from their working papers. This request was met with strong objections from committee members. Senator Ibrahim Dankwambo, the committee chairman, questioned why auditors who certified the accounts could not readily access the schedules backing the figures.

The auditors explained that NNPC Ltd. is their client and that explanations should ideally come from the company. They recalled a previous agreement that NNPC officials would provide these explanations. However, Senator Abdul Ningi invoked Sections 88 and 89 of the Nigerian Constitution, asserting the National Assembly's broad investigative powers to compel the production of documents. He stressed that the auditors, as independent professionals, must comply with the Parliament's lawful requests without first seeking permission from their client.

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The Constitution empowers this committee to invite any person and request any document necessary for our investigation. You are before this committee as independent auditors. Do not tell us you must first seek permission from your client before complying with the lawful request of Parliament.