The Federal Government, FG, has moved forward with plans to enlist an external auditor to verify the Nigerian National Petroleum Company Limited’s (NNPC) N2.7 trillion fuel subsidy claim.
This independent audit will support the Office of the Auditor-General of the Federation in establishing the accurate amount owed by the government.
This decision comes five months after the initial proposal at the Federation Allocation Accounts Committee (FAAC) meeting in April 2024.
NNPC initially claimed an outstanding balance of N6 trillion, which was later reduced to N2.7 trillion following an audit by KPMG.
The audit will cover the period from 2015 to 2021, aiming to address discrepancies and verify the subsidy claims. Despite regular updates from Ali Mohammed, Director of Home Finance at the Ministry of Finance, significant steps to audit the claim had not been implemented until now.
On May 30, 2023, shortly after President Bola Tinubu announced the removal of the petrol subsidy, NNPC Group Chief Executive Officer Mele Kyari disclosed that the government still owed N2.8 trillion for the subsidy. Kyari noted that NNPC had been covering the subsidy costs from its own funds, as the government had yet to reimburse the amount.
According to recent FAAC meeting minutes obtained in Abuja, the procurement department of the Ministry of Finance has started the process of selecting an external auditor.
The minutes stated, “The Director of Home Finance reported that the Office of the Auditor-General of the Federation was still working on the matter, adding that the Procurement Department of the Ministry had also put structures in place for the engagement of an external auditor.”
Discussions at the meeting included suggestions to extend the audit period to December 2023, and to limit the scope to cover the period from 2021 to June 2022, when NNPC was still a corporation.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, acknowledged the contributions from members and expressed hope for a swift completion of the audit process.
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