Forensic Audit of Osun Payroll System: Firm Alleges N13.7bn Annual Fraud

Segun James 

Following the Osun State government’s ordered forensic audit of its payroll system, a Lagos-based audit firm, Sally Tibbot Consulting Limited, has unearth an alleged annual payroll fraud amounting to N13.7 billion.

The company however cried out after the government sanctioned audit, the state has turned around to discredit the report, a move that how now pitched Sally Tibbot and the government against each other.

Sally Tibbot in statement signed by its Chief Executive Officer, Ms Sa’adat Bakrin-Ottun, said that the reputation of the firm as an audit firm is now being called to question as the Osun State government is now claiming to have done another audit after the Sally Tibbot report had been submitted.

The firm made the allegation on yesterday during a press briefing at the Nigerian Union of Journalists (NUJ) Press Centre in Ikeja, Lagos, where it also called on the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and Other Related Offences Commission (ICPC) to investigate the matter.

Addressing journalists on behalf of Sally Tibbot Consulting Limited, counsel to the firm, Barr. Jiti Ogunye, alleged that the firm was awarded a contract by the Osun State Government in April 2023 to conduct a statewide verification, validation and re-engineering of the payroll system covering civil servants, local government staff, teachers, employees of state-owned tertiary institutions and pensioners.

The firm said the contract, signed in May 2023, mandated the firm to carry out physical and biometric verification of workers and pensioners, audit existing payroll records and develop an automated payroll administration system for the state.

Presenting its findings, the company claimed that while the state’s payroll for January 2023 stood at N4.48 billion monthly for 37,456 staff and 17,918 pensioners, its audit reduced the genuine payroll figure to about N3.34 billion for 29,004 staff and the same number of pensioners.

It alleged that 8,452 ghost workers were discovered on the payroll, leading to purported monthly savings of N1.14 billion and annual savings of N13.7 billion for the Osun State Government.

The firm further alleges, “Out of the total number of 8,448 workers declared by SALLY TIBBOT as unseen workers, the Osun State Government was able to confirm 8015 as active workers while 433 workers were found to be unreachable. 

“The cost implication of the said 433 unseen active workers stands at Thirty-six Million, Eight Hundred and Ninety-six Thousand, Two Hundred and Ninety-one Naira (N36,896,291.00) only.

“Also, out of the total number of 6,713 retirees declared as ghost workers by SALLY TIBBOT, the Osun State Government was able to confirm the existence of 5,830 retirees while 883 could not be reached. The cost implication of the 883 unreachable retirees stands at Eighteen Million, Three Hundred and (Fifty-Nine) Thousand, Seven Hundred Naira, Sixty-four Kobo (N18,359,700.64) only.

“Thus, the total number of workers whom the Osun State Government has not been able to ascertain their existence is 1,316 against the 15,161-worker(s) declared as ghost workers by SALLY TIBBOT; meaning that the total cost implication of the confirmed unascertainable workers amounts to N55,255,991.64 (Fifty-Five Million, Two Hundred and Fifty-Five Thousand, Nine Hundred and Ninety-one Naira, Sixty-four kobo) only; and that the explanation gotten so far for the absence of the workers who have been unreachable is that some of them are indisposed while some of them were on leave at the time of the verification exercise.”

The firm added that its audit exercise lasted 12 months, including six months of physical verification across the state, and claimed it spent over N600 million in logistics, personnel and operational costs to deliver the assignment.

Sally Tibbot Consulting further alleged that despite submitting its final audit report to Governor Ademola Adeleke in June 2024, and publicly presenting it in Osogbo in July 2024, the state government had neither implemented the recommendations nor paid its professional fees, contrary to the terms of the contract.

The company rejected claims by the Osun State Government that a subsequent re-verification exercise had significantly reduced the number of ghost workers identified in the audit. It described the government’s position as an afterthought aimed at avoiding payment and continuing alleged payroll fraud.

“For the firm to be accused of presenting a fake audit reports, it’s a great deal of professional traducement.”

According to the firm, the contract did not provide for any post-audit re-verification, adding that the state lacked the technical capacity to independently conduct such an exercise in the first place.

Sally Tibbot Consulting accused the government of impugning its professional integrity and reputation by suggesting that its findings were exaggerated, insisting that its report was thorough, factual and credible.

While calling for the implementation of the audit report, the firm also raised concerns over alleged threats and security risks faced by its personnel during the audit exercise, describing the assignment as dangerous due to entrenched interests benefiting from the payroll system.

It called on anti-corruption agencies to conduct independent investigations into the alleged payroll fraud in Osun State, saying such a probe would both vindicate the firm and ensure accountability in the management of public funds.

As of the time of filing this report, the Osun State Government had not publicly responded to the allegations raised at the press briefing.