Senate Asks FRC to Refund N66m Spent on Unoccupied Building

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  • Faults alleged diversion of N28m

By Deji Elumoye and Udora Orizu

The Senate Committee on Public Accounts has directed the Financial Reporting Council of Nigeria to refund to the Federation Account, N66 million the agency paid as a two-year rent to secure an accommodation which it never occupied.

The Committee chaired by Senator Mathew Urhoghide also faulted the agency’s reported use of 64 vouchers to divert N28 million.
The committee members are currently scrutinising the 2015 to 2018 report by the Auditor General of the Federation, which queried the FRC for investing N66 million on accommodation it never occupied.

The query reads: “It was observed that, on 21/11/16 the sum of N42m was paid as rent to Japaul Oil and Maritime Services for an office space at Japaul Building. N23.4m was paid to Sola Oluseyi & Co, as legal and agency fee for the office space, making a total of N66m for two years ending 1/1/2019. The Council is yet to move into the building, 20 months running with 4 months to its expiration. (as of 2019).

“This anomaly was due to the failure of the Executive Secretary (of the FRC during the period) to exercise due diligence in the application of public funds by ensuring that value is received for money expended. The Council carried 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.”

Another query raised by the AuGF against the FRC reads: “During the audit, it was observed that sixty four (64) payment vouchers for the sum of N28,765,842.11 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.”
But, FRC in its written response, claimed that it was carrying out repairs and partitioning of the building while the rent was running.
The Council also said it was taking steps to utilize the building and secure a further lease from the landlord.

The council 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 committee Chairman, Senator Urhoghide, at Wednesday’s sitting directed that the FRC management should refund forthwith to the Federation Account the N66 million paid for the said unoccupied building in 2016.