The report flagged regulatory lapses, lack of adherence to due process, and weak internal controls. Audit officials were unable to verify how the funds were utilized or if the expenditures complied with existing financial regulations.
According to the report, the London office spending violates several provisions of the Financial Regulations (2009), including:
- Paragraph 112: Accounting officers must ensure internal controls for proper revenue collection and expenditure.
- Paragraph 415: Officers must exercise due economy and avoid spending simply because funds were voted.
- Paragraph 603(1): Vouchers must provide full details of each service and be supported by relevant documents like invoices and purchase orders.
The Auditor-General warned that such irregularities pose significant risks, including the misappropriation or diversion of public funds.
In response, NNPCL management insisted the London office operates as a service unit with an annual budget of £14.3 million, executed according to operational and financial requirements. They claimed detailed records of all expenditures, including personnel costs and operational contracts, were maintained and could be made available for audit.
Despite the explanation, the Auditor-General described the response as unsatisfactory and directed the Group Chief Executive Officer to recover and remit the funds to the treasury. Failure to comply may trigger sanctions under the Financial Regulations.
The report also highlighted broader concerns over NNPCL’s finances, citing irregular payments, inflated contracts, unexecuted projects, and failure to deduct statutory taxes. Between 2020 and 2021, over $51 million in questionable settlements were flagged, alongside about N684 million spent on abandoned projects and irregular procurements.
NNPCL’s history of opacity has drawn national attention. The company did not make its audited accounts public for 43 years until 2020. Presently, the EFCC is investigating 14 NNPCL officials, including former CEOs Mele Kyari and Abubakar Yar’Adua, over an alleged $2.7 billion fraud in refinery maintenance projects.
Since June, the Senate Committee on Public Accounts has been probing unaccounted funds of N210 trillion in NNPCL’s audited financial statements between 2017 and 2023. Previous Auditor-General reports also highlighted the unauthorized diversion of N514 billion.
The Auditor-General’s latest report underscores the urgent need for NNPCL to improve transparency, compliance, and accountability in managing public resources.
