THE IMPERATIVE OF PERFORMANCE FORENSIC AUDIT
Performance audit eliminates waste and ensures that public funds are judiciously utilised, contends ILIYASU GASHINBAKI
Performance Forensic Audit involves a comprehensive examination of functions, processes and systems within the government, including review of systems performance and public procurement audit. It cuts across financial management, operational performance, resource allocation, infrastructure management, asset integrity and value for money.
A subsisting Performance Forensic Audit is imperative for Nigeria to curtail and ultimately eliminate wastage by the Federal, State and Local Governments. With the Performance Audit, the various tiers of government can identify areas of improvement, eliminate waste, and ensure that public funds are utilised judiciously, thereby improving the efficiency and effectiveness of government programmes, processes and activities.
Indeed, it is outlandish, even unimaginable that an institution like the Nigerian National Petroleum Corporation (NNPC), now rechristened NNPC Ltd, operated for 43 years without its accounts being audited! Another glaring example of the wastages associated with the lack of forensic performance audit is the Central Bank of Nigeria (CBN). According to Section 38 (2) of the CBN Act, 2007, the total amount of advances outstanding shall not at any time exceed five percent of the previous year’s actual revenue of the federal government. This was breached by the former governor of CBN, thereby leading to trillions being printed in breach of the provisions of the CBN Act, 2007. It is pertinent to note that none of the previous Central Bank Governors breached the provisions of the Act. But for this to have happened, shows it can happen again if the Performance Forensic Audit is not put in place.
This is even more critical in the energy sector. Nigeria’s economic prospects are tightly tied to its ability to generate, transmit, distribute, and manage energy efficiently. Yet, as at present, the sector’s performance remains one of the most glaring obstacles to economic growth, industrialisation and one of the major obstacles to the vision of the $1 trillion economy projected by President Bola Ahmed Tinubu.
Not unexpectedly, in 2024 alone, manufacturers spent a staggering ₦238.3 billion on alternative power. The telecommunications sector also incurs substantial energy costs, spending over $350 million annually on diesel to power its operations. Clearly, the current model of management and oversight in the energy sector is not yielding the result that Nigerians desperately need. A performance forensic audit of the sector has become not only necessary but exigent.
Is it not preposterous that Nigeria’s donor-funded and development-partner-supported projects across the country are not delivering the needed dividends in spite of the stringent processes of the bi-lateral and multi-lateral agencies? For instance, a report published by Corporate Accountability & Public Participation Africa (CAPPA), revealed that Nigeria would be repaying $6.25 million annually for 40 years, amounting to a total of $250 million excluding accrued interest on the loan for the failed World Bank-funded water project – the Third National Urban Reform Programme – approved in 2015 with the aim of improving water supplies in Ekiti, Bauchi, and Rivers State. Sadly, a decade later, residents in these States still rely on water vendors for contaminated supplies.
It is my considered opinion that with a performance forensic audit in place, such a pathetic situation would never have occurred in the first place, let alone fester. I am therefore recommending that an audit should be immediately designed to independently verify the level of implementation, trace the flow and utilisation of funds, uncover instances of misappropriation or abandonment, and ensure that responsible parties are held accountable. Such a strategic step is not only necessary to restore public trust and donor confidence but also critical to safeguarding Nigeria’s future access to development financing.
To ensure the effective implementation of the Performance Forensic Audit in all the sectors identified above, I am proposing that the federal government and the sub-nationals should put in place, an independent oversight mechanism which should include forensic experts in our Institute, Chartered Institute of Forensics and Certified Fraud Investigators of Nigeria (CIFCFIN) alongside other Civil Society Organisations (CSOs) and Non-Governmental Organisations (NGOs). The scrutiny will provide an objective and independent assessment of government’s utilisation of its resource capital and contribute to the overall success of good governance.
While the introduction of Key Performance Indicators (KPIs) for Ministers by President Bola Ahmed Tinubu is a commendable step toward performance-driven governance, real impact requires that these accountability measures extend beyond the cabinet. KPIs must be embedded across all levels of government, particularly Directors General, Chief Executives of Ministries, Departments & Agencies (MDAs), Project Coordinators, and Local Implementation Units, who are responsible for operational delivery and the day-to-day execution of government functions.
It is within these layers that the bulk of public expenditure occurs, and where leakages, inefficiencies, and underperformance often fester. By institutionalising KPIs alongside Performance Forensic Audits at these levels, the government can ensure that budgetary allocations are not only disbursed, but also deliver tangible, measurable results.
Our Institute has since its charter, produced highly trained forensic experts deploying cutting edge forensic tools to handle complex cases of corruption, fraud and other financial crimes. Working the CSOs and NGOs, I am confident that we would turn the ugly tide around for the betterment of our country at large.
Dr. Gashinbaki is the Founder/Chairman, Governing Council, Chartered Institute of Forensics and Certified Fraud Investigators of Nigeria. He can be reached on president@cifcfin.org
