BY DELE SOBOWALE

“The CBN external auditors who signed the CBN 2012 audited financial statements will be required to provide some clarification by the FRC (Financial Reporting Council) and even by the CBN board as they continue the investigation directed by the Presidency.” Industry source, PUNCH, March 7, 2014, p 28.

President Goodluck Jonathan and Lamido Sanusi

If there is one thing still baffling to me in all the revelations about the alleged misdeeds of the CBN Governor, it relates to all those in position, including President Jonathan, who left undone the things they should have been doing since the FRC released its scathing report about gross abuses at the CBN last year.

However, before going into specific indictment of willfully negligent officials, let me explain to those who might not be aware of what the FRC is now planning to do – months after it should have done them.

External auditors once they audit a company’s accounts are supposed to write a covering report indicating whether the books of accounts have been maintained according to prevailing regulations of the Financial Standards Board or the organization governing such matters.

They are also supposed to point out irregularities and deviations from laid down policies and procedures. Finally, they are supposed to qualify the accounts presented once they are convinced that fraud had occurred – irrespective of who is responsible. But, that occurs only in theory.

External auditors of CBN, NNPC, Ministries, NPA, First Bank. MTN, Dangote etc, after landing the big accounts are quite often unwilling to lose them on account of being too technical. The safest thing for them is to allow infractions to mount until the organization is exposed by the bad odour oozing from its premises.

In fairness to Nigeria’s external auditors, this is a global phenomenon and not localized to Nigeria. The global financial crisis of 2008 became so threatening to the global economy mostly because several reputed international auditing firms had colluded with the banks and investment houses they audited to cover up grievous banking crimes.

However, whether, or not, the external auditor had done an excellent or a shoddy job, those to whom the reports are written are supposed to read them AS SOON AS POSSIBLE. The FRC sent its report to the President last year – which pointed to several irregularities in the management of the affairs of the CBN. Each of those infractions carries its own penalties – some call for warning; others for dismissal after following due process.

To start with the FRC should have requested for the report or management letter (as it is sometimes called) to ascertain whether or not, the external auditor had done a thorough professional job or had colluded with the CBN in covering up major crimes.

There are also penalties for such collusion on the part of external auditors with the management of the companies or institutions they audit. The least of the penalties is that the external auditor is relieved of the appointment. And, where the external auditors had allowed themselves to be induced to cover up crimes, imprisonment remains one of the options left to government – in addition to sanctions by their professional bodies.

So, one of the first things which should have been done, even before Sanusi was queried, was to read the external auditor’s report. It would appear that neither the FRC, nor the President, nor the Board of Directors of CBN had read a management report handed to them a long time ago by the external auditors.

That is inexcusable negligence bothering on economic sabotage. If they had, it is quite possible that all the allegations recently made would have come to light long before Sanusi blew the whistle on $20 billion missing from NNPC. The matter would have been vastly easier to judge by all patriotic Nigerians.

So, if the government finds itself being harassed by Lai Mohammed and other critics, it is because they neglected a sacred duty.

802-877-2176 ..You always advise we obtain a degree in street wisdom. Sanusi has always lived in illusion that the Northern-dominated Senate will always back him if the President was to sack him. The President conscious of d humiliation of not getting 2/3 went 4 a short cut i.e suspension..What differentiates Sanusi 4rm d banks MDs he sacked in 2009?….

To avoid a recurrence of this type of abuse by a future CBN governor it is my humble submission that the CBN Act be looked into again..This will check the tyranny of a future “Sanusi”.  Odafe O.

0803-682-0306  How I wish dat Nigeria has jst 20 people who reason like u..Its a pity dat wt his PhD Jonathan turned out to be more vain than Obasanjo…Our NASS is merely an assemblage of buccaneers, so they can’t think of suspending/or impeaching Jonathan. Sanusi is one of Jonathan’s evil clan. Barr. Aghaobodo.

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