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Audit Reveals CBN’s Failure to Account for $4.5 Billion in Foreign Reserves

February 12, 2024

 

 

 

 

 

 

A recent audit report from the Office of the Auditor-General of the Federation (OAuGF) has revealed a staggering discrepancy of $4.5 billion in Nigeria’s Foreign Reserves between 2018 and 2019. The report highlights a decline from US$42,594,842,852.75 to US$38,092,720,200.72 during this period, raising questions about accountability and financial management within the Central Bank of Nigeria (CBN).

The audit report, which meticulously scrutinizes government expenditures and finances, identifies this significant shortfall as occurring during the tenure of Godwin Emefiele, the former governor of the CBN, who is currently facing corruption charges.

Shaakaa Chira, the Auditor-General of the Federation, has called upon the CBN to provide explanations for the missing funds, emphasizing that such discrepancies jeopardize the stability of Nigeria’s exchange rate and contravene the Central Bank of Nigeria Act of 2007.

Furthermore, the report reveals additional concerns regarding an ‘unsubstantiated’ decline of over $8 billion in foreign reserves between 2019 and 2020, indicating systemic weaknesses in internal control mechanisms at the CBN.

In addition to the mismanagement of foreign reserves, the CBN failed to account for funds recovered from the Economic and Financial Crimes Commission (EFCC) between 2016 and 2019, despite continuous activities related to forfeitures of looted funds to the federal government.

Responding to these allegations, the CBN asserted its efforts to engage in initiatives such as the Presidential Artisanal Gold Mining Initiative (PAGMI) and interventions in the agricultural sector to boost foreign exchange reserves and stabilize the exchange rate.

However, experts express grave concerns over the implications of these discrepancies. Lukman Rahim, an Associate Chartered Accountant and lecturer at the University of Jos, warns that the erosion of trust in Nigeria’s financial institutions could deter foreign investment and exacerbate economic instability, directly impacting citizens’ purchasing power and hindering long-term development.

Emmanuel Yoko, Director at the Nigerian College of Accountancy, echoes these sentiments, emphasizing the potential increase in debt collection and servicing as a consequence of the missing funds, further burdening the masses and complicating the nation’s economic landscape.

 

 

Credit: Premium Times

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One comment on “Audit Reveals CBN’s Failure to Account for $4.5 Billion in Foreign Reserves”

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