Senate Gives NNPC Auditors One Week to Explain N210 Trillion Unreconciled Balance Sheet Entries
Nigeria’s Senate has given the external auditors of the Nigerian National Petroleum Company Limited (NNPC Ltd.) one week to provide detailed documentation supporting more than N210 trillion ($ equivalent) recorded as receivables and payables in the state-owned oil company’s audited financial statements, escalating parliamentary scrutiny of the country’s largest energy company.
The Senate Public Accounts Committee, chaired by Senator Ibrahim Dankwambo, said the auditors must submit comprehensive schedules, working papers and supporting documents explaining approximately N107 trillion in receivables and N103 trillion in payables, arguing that the figures remain insufficiently reconciled despite appearing in audited accounts.
Lawmakers stressed that they are not alleging that funds are missing, but insisted that financial entries of such magnitude must be fully explained and supported by documentary evidence.
Senate Rejects Auditors’ Request for More Time
The hearing became contentious after representatives of the external audit firm requested about two weeks to retrieve the detailed schedules, describing them as part of their audit working papers.
The committee rejected the request, ordering the auditors to return within one week.
Dankwambo questioned why auditors could not immediately produce documents supporting figures they had already certified.
“When financial statements contain figures of this magnitude, there should be supporting schedules showing exactly how those numbers were derived,” he said.
Lawmakers Say Auditors Must Defend Certified Accounts
The auditors argued that NNPC Ltd., as their client, should provide explanations for the disputed figures and noted that company officials had previously appeared before the committee to address the accounts.
Senators rejected that position, maintaining that external auditors have an independent professional responsibility to defend the audit opinions they signed.
Senator Abdul Ningi cited the investigative powers granted to the National Assembly under Sections 88 and 89 of Nigeria’s Constitution, saying Parliament has the authority to compel individuals and organisations to produce documents relevant to its investigations.
“You are appearing before this committee as independent auditors,” Ningi said. “You cannot insist on obtaining permission from your client before complying with a lawful request from Parliament.”
Former Edo State governor and Senator Adams Oshiomhole echoed the position, arguing that the questions before the committee arose directly from the auditors’ work.
“These figures came from your audit. Therefore, you are responsible for explaining the basis upon which they were certified,” he said.
Focus on N210 Trillion in Receivables and Payables
According to the committee, NNPC officials have previously indicated that much of the receivables and payables relate to joint venture cash calls and related payments.
However, lawmakers said neither the company nor its auditors has adequately identified the individual transactions, counterparties or reconciliations supporting the balances.
Dankwambo said that if the entries relate to the same commercial activities, they should be capable of reconciliation.
“We are not saying the money is missing,” he said. “We are saying these figures remain unexplained. Amounts of this size appearing in audited financial statements without adequate reconciliation are deeply concerning.”
Senate Rejects Confidentiality Argument
The committee also dismissed arguments that confidentiality obligations prevented the auditors from releasing the requested documentation.
Oshiomhole argued that NNPC Ltd., being wholly owned by the Federal Government on behalf of Nigerians, cannot invoke commercial confidentiality to withhold information from Parliament during a constitutional investigation.
“There can be no secrecy between an auditor and a government-owned company when Parliament is exercising its constitutional oversight responsibilities,” he said.
Senator Babangida Useni similarly argued that professional confidentiality cannot override the investigative authority of the National Assembly over state-owned enterprises.
Committee Warns of Audit Accountability
Drawing on international experience, Dankwambo warned that external auditors must be prepared to defend the financial statements they certify, referencing the collapse of Arthur Andersen following the Enron accounting scandal as an example of the reputational risks associated with audit failures.
The committee directed the auditors to return within one week with a detailed breakdown of every component of the N107 trillion receivables and N103 trillion payables, including supporting schedules, audit documentation and the basis for certifying the balances.
Before adjourning the hearing, Dankwambo reiterated that the Senate’s investigation is focused on transparency and accountability rather than allegations of missing funds.
“The committee has never said the money was stolen,” he said. “Our position is simply that these figures remain unexplained, and that is what must now be clarified.”
The Senate Public Accounts Committee adjourned the hearing and ordered the auditors to reappear within one week with the requested documentation.
