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N94 million scandal rocks Financial Reporting Council

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The Financial Reporting Council (FRC) has been enmeshed in fraudulent practices and authority stealing to the tune of N94 million.

Senate Public Accounts Committee headed by Senator Mathew Uroghide currently investigating financial transactions of Ministries, Departments and Agencies of government discovered how the Financial Reporting Council of Nigeria paid N66 million for two years rent without occupying the building.

While scrutinising the books of accounts, the Committee uncovered another N28 million fraudulently spent using about 64 payment vouchers.

The erstwhile Executive Secretary of FRC, Jim Obazee was alledged to have perpetuated the fraud during his tenure.

CAPITAL POST recalled how the former Secretary of FRC Stoke controversy in the removal of Pastor Enoch Adeboye as the General Overseer of the Redeemed Christian Church God, RCCG, Nigeria, some three years ago.

The Council ran foul of its responsibility for setting and promoting compliance with standards for accounting, financial reporting and auditing in Nigeria, under which it created its controversial Code of Corporate Governance.

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The breakdown of the N66 million showed that the FRA paid N42 million for rent and N23.4 million as legal fee.

The query 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 an 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.

“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.

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“The Council may carry out 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 waste of government resources.

But, the Finance Reporting Council in its written response said, “Management’s response was that, upon the acquisition of the office accommodation at the
Japaul House, there was need to give the property a face-lift including partitioning befitting of an office. However, there was 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. Auditor’s evaluation.”

It was further gathered that the former Executive Secretary has an interest in that particular building paid for by the Financial Reporting Council.

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Also in another query which reads, “During the audit, it was observed that sixty four (64) payment vouchers for the sum of
N28,765,842.11 (Twenty eight million, seven hundred and sixty five thousand, eight hundred
and forty two naira, eleven kobo) 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 the strengthening the internal control system in government agencies. Payments arising from vouchers not pre-audited cannot be accepted as judicious charge against public funds.”

The Chairman of the Committee however ordered the former Executive Secretary to return N94 million fraudulently collected to Federation Account.

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