NCAA Underremits 25% Operating Surplus, Audit Report Reveals

The 2019 audited report of the federation has exposed the Nigerian Civil Aviation Authority (NCAA) for under-remittance of the approved 25 percent share of the total internally generated revenues/operating surplus to the Consolidated Revenue Fund (CRF) account of the federal government.

The findings, presented in the non-compliance report by the Auditor General of the Federation, highlight financial irregularities within the authority.

According to the report, which was obtained through the Paradigm Leadership Supportive Initiative (PLSI), the audit observed that the NCAA generated a total of N18.33 billion as internally generated revenue (IGR) in 2018.

The approved 25 per cent share of the IGR, amounting to N4.58 billion was expected to be remitted to the treasury. However, only N1.6 billion was remitted, resulting in an under-remittance of N2.98 billion.

The audit report attributes these discrepancies to weaknesses in the internal control system of the Nigerian Civil Aviation Authority. These weaknesses have not only posed a risk of loss of government revenue but have also created difficulties in funding the budget from public funds.

In response to the audit report, the NCAA management has defended its actions by stating that they were only required to remit 80% of its operating surplus. They claim that the actual liability for 2018 was to be determined after the external audit of the financial statements.

The Auditor General of the Federation has recommended that the director general of the NCAA provide reasons for failing to remit the required 25% of the internally generated revenue to the treasury, as mandated by extant regulations. These regulations, including the Re-Introduction of Treasury Single Accounts (TSA), require government agencies not funded through the federal government budget to pay 25 per cent of their gross earnings as operating surplus to the CRF. Additionally, a federal Ministry of Finance circular from November 11, 2011, stipulates that federal agencies should limit their utilisation of internally generated revenue to 75 per cent, with the remaining 25 per cent to be remitted to the CRF account.

The Auditor General’s recommendations also include the application of sanctions specified in paragraph 3112 of the financial regulations, pertaining to the failure to collect and account for government revenue.

As the revelations of under-remittance come to light, stakeholders and the public are calling for swift action to address these financial irregularities. The findings underscore the importance of upholding financial regulations and ensuring transparency and accountability within government agencies. It is expected that the relevant authorities will conduct a thorough investigation and take appropriate measures to rectify the situation and prevent similar occurrences in the future.

Speaking to LEADERSHIP, the director general of NCAA, Capt. Musa Nuhu, said clarification should come from the office of the Accountant General of the federation.

He said, “I think you need to get clarification from the office of the Accountant General of the Federation (AGof) because I can’t make any comment without having facts and figures before me.

“If we under-remitted, we will be notified because the system is self-checking,” Nuhu stated.