FG Appoints Auditors To Monitor States’ Finances

James Emejo in Abuja
The federal government has authorised an independent financial audit of the 35 state governments
which accessed its N510 billion Budget Support Facility (BSF) in June last year.
Already, eight reputable accounting firms including KPMG, Ernst and Young and PWC, had been
appointed to undertake an independent review of states’ financial management positions.
Importantly, the auditors are required to monitor and evaluate the implementation of the 22-point
Fiscal Sustainability Plan (FSP) which was the precondition for accessing the intervention by the
benefiting states.
Though the Federal Ministry of Finance had been monitoring compliance to the agreement since
June 2016, the independent monitoring and verification of the states involved in the bailout
programme will now be undertaken by the selected accounting firms.
The BSF is a 12-month standby loan facility designed to bring immediate financial relief to state
governments and enable them meet their financial obligations with a monthly amount of N50 billion
in the first three months and N40 billion available for the remaining nine months to beneficiaries.
On the other hand, FSP is a 22-point reform programme which the states had pledged to observe as
precondition for accessing the loans mandated for marked increases internally generated revenues,
introduction of biometric payroll, publication of audited annual financial statements, and reduction of
wastages by establishing efficiency units among other things.
The Minister of Finance, Mrs. Kemi Adeosun, had, while announcing the appointment of the
accounting and audit firms, charged them to “vigorously monitor, evaluate and verify the
performance of the states against the agreed milestones set by each state government under the
FSP.”
State governments that fail to implement the action plans, as stated, would be taken off the facility
with immediate effect.
The FSP was introduced for Sub-national governments in 2016 with the view to enhancing fiscal
prudence and transparency in public expenditure.
The plan is part of the nationwide Public Financial Management Reform which is being implemented
by the administration of President Muhammadu Buhari through the Federal Ministry of Finance.