By Dele Sobowale

“Forensic audit report prepared without Bank Statement, says PwC.” THE NATION, April 29, 2015, p 4.

The report written by Nduka Chiejina revealed the following. “The forensic audit report on the Nigerian National Petroleum Corporation, NNPC, compiled by PricewaterHouse Coopers (Pwc) was done without bank statements, the report said. The Central Bank of Nigeria (CBN), according to the report, shunned the auditors’ request for the bank statements.”

PricewaterHouseCoopers should be ashamed of itself that the internationally highly regarded auditing firm ever got itself into this mess – at any price. No local auditing firm in any country in the world would ever conduct what it calls a forensic audit report without obtaining bank statements in respect of the organizations it has been called upon to audit.

Even, a freshly minted ICAN Chartered Accountant anywhere in the world knows that most everything in audit ends in the bank accounts.

Certainly, PwC must have assigned this monumental task to some of its most experienced national and international auditors – given the magnitude of the amount in dispute. PwC, and the auditors assigned to this particular audit have done the company’s reputation a great deal of damage with this self-made confession and its implications. To be sure, PwC had accomplices in what can only be regarded as deliberate cover up. Among them is the Central Bank of Nigeria, CBN, where the whole palaver about missing funds started in the first place.

It was the former Governor of the CBN who raised alarm in late 2013 that $47bn had not been remitted to the Federation Account by NNPC. Later, under interrogation, the amount outstanding to the Federation Account was reduced to $20bn. Meanwhile, for blowing the whistle, Sanusi Lamido Sanusi was hounded out of office by the Jonathan administration, which under public pressure promised a “forensic audit”. What PwC eventually produced last month, again under duress, must have been the longest delayed audit on a matter of urgent national importance.

Ordinarily, one would have expected PwC, with its international reputation at stake, and Nigeria’s vital interest involved, to conduct and release a report on which everybody from the Chief Executive Officer, CEO, would be prepared to stake his life for its veracity. Unfortunately, that was not the case. PwC, for whatever reasons known to its managers and the auditors assigned to this project, has now become part of the problem and not the solution. Let me point out some of the problems the staff assigned have created for the auditing firm – starting from the first.

PwC’s first problem is one of credibility – allied with integrity. Unfortunately, for the company, integrity is a 100% issue for an auditing firm. Even 95% is not good enough. An auditing firm which issues a “forensic report” without copies of the bank statements has already violated one of the primary professional requirements of an audit. Hoe, on earth would the auditors know that funds that were supposed to be transferred to bank accounts actually got there?

Even student of Business Administration, who only obtained theoretical lessons in auditing know that it was totally unprofessional for PwC to continue with the assignment once it was made clear that bank statements were not forthcoming. So, the report lacks credibility because it was professionally flawed. The possibility of deliberate collusion to cover up several frauds by PwC’s staff arises from what was written before.

If, non-professionals knew that an audit, forensic or routine, is not complete without bank statements, how could the well experienced auditors of PwC, on this assignment fail to see that they were about to issue a report which, at best, is fit only for the dust bin? Surely, all those involved must be aware that they were issuing a report which fell far short of the highest professional standards; at a time when only the very best was required of them.

That they probably knew they were being unprofessional, yet going forward and risking their company’s reputation, as well as their own, naturally leads to the next set of questions. The first one is: who engaged them? Was it the Ministry of Petroleum? Or the NNPC? Or the Ministry of Finance? Or the Auditor General’s Office? Or the Secretary to the Federal Government of Nigeria? Or the Presidency?

Irrespective of who paid them for this, obviously shoddy job, Nigerians, and, indeed, the entire world wants to know the Terms of Reference, TOR, for the audit. Were they specifically forbidden to request for and obtain bank statements? And, if not, why was there no demand for those documents, through their principal for them? And, why did PwC fail to honourably resign when it was clear that a credible “forensic audit” was not possible under the circumstances?

Finally, if they were told to back off from obtaining bank balances, they need to tell the whole world who did it.