Sir: Recently, President Muhammadu Buhari ordered a forensic audit of the operations of the Niger Delta Development Commission from 2001 to 2019. The decision followed persistent criticisms of the operations of the commission. The President said what was presently on ground in the South-South region did not justify the huge resources that had been made available to the agency. Considering the statement of Mr. President, a project audit (which focuses on financial and performance) should also be carried out to complement the forensic audit (which focuses more on financials).
While the objective of forensic audit is to obtain evidence that can be used in legal proceedings to resolve a dispute or prove innocence /guilt in a criminal case, such as providing evidence of money laundering; the objective of project audit is to reach a conclusion whether the Niger Deltans have obtained value for money in terms of economy, efficiency and effectiveness from the commission’s operations. NDDC carries out several projects in the region in line with NDDC Act for the development of the region. The project audit approach requires an audit of each phase of the project life cycle from conceptualisation and design, through tendering and to construction/execution.
At the conceptualisation phase, Cost–Benefit Analysis of projects done (completed and ongoing) prior to commencement should be audited for value for money. Location of projects in the region should also be reviewed for appropriateness, equity distribution within the region, people / community’s requirement inter alia. At the design phase; selection of consultants, basis and computation of professional fees paid, community needs assessment, and designs inter alia should be audited for due process compliance, economy, efficiency and effectiveness. Any overpayment of fees based on arbitrary basis should be refunded to the commission. At the tendering phase; selection of consultants, interested party relationship, contract documents inter alia should also be audited for transparency, completeness in scope and quality.
At the construction /execution phase where the majority of project fund is expended and likely mismanaged, audit of payment certificates (interim /final ) issued by the supervising consultants should be carried out. An independent expert opinion should be obtained on the value of work done considering the scope and quality of work (materials and workmanship) deployed on the project. The third party opinion will also give information on the project status and deviation (if any) from the payment certificates. Where the value of work done is less than payment made, the contractor should refund the excess. Variation and fluctuation on projects should be audited for requisite approvals, scope and quality.
For example a contract for the construction of 30 km double lane road (7.5m width) with 75mm thick asphalt wearing course can actually be commissioned as a 30km double lane road (7m width) with 50mm thick asphalt wearing course. This reduction in the width and thickness of asphalt (which is not visible to the naked eye) of the road can result to loss of several millions of naira which can be corruptly shared among the stakeholders. One can only challenge what one is informed about. This reduction will affect the lifespan of the road as well as the safety of the road users.
Finally, contracts and procurement processes should be audited for compliance with the Public Procurement Act (PPA) of 2007. Actual project scope, cost, quality, time etc should be compared with contractual requirements for possible deviations. Where deviations are unfavourable or alarming, it should be investigated. Erring officers should be identified and punished in line with relevant laws to serve as deterrence to others. Project /financial controls should also be reviewed for effectiveness.
Sowunmi Williams, real estate and infrastructure consultant, wrote from Lagos.