2 January 2013

Nigeria: Power Ministry Denies Alleged Disregard for KPMG Audit Report

The Ministry of Power has said it does not have any audit report of operations in Nigeria's Electricity Supply Industry (NESI), which was allegedly submitted to it by the Nigerian Electricity Regulatory Commission (NERC) for adoption and implementation of its recommendations.

Stating Tuesday in Abuja that it has fittingly responded to any of such audit report submitted to it, the ministry also said that the KPMG audit was however not part of official documents handed over to the Minister of State for Power, Hajia Zainab Kuchi, when she swapped positions with former Minister of State for Power, Darius Ishaku, in November 2012.

In a statement from its Assistant Director of Press, Haruna Ibrahim, in Abuja, the ministry denied media report which disclosed its alleged refusal to implement recommendations contained in an audit process inaugurated by NERC and executed by KPMG Financial Services in 2010 on the performance of the NESI in relation to the workings of the Multi Year Tariff Order (MYTO) framework.

The audit which was inaugurated to reconcile the accounts of the Market Operator (MO) with that of other market participants and determine related liabilities in operations within the electricity value chain, disclosed that market participants especially the MO had misapplied the MYTO mechanisms in management of financial procedures in the sector right from its inception in 2008.

The report also uncovered the various underhand dealings perpetrated in the market within its review period of 2008 to 2010, all of which resulted to over N200 billion worth of unpaid energy bills owed to market participants.

But the ministry in denial said: "The attention of the Federal Ministry of Power has been drawn to a THISDAY Newspaper publication of Friday 28th December 2012.The publication alleged that the Federal Ministry of Power had received an audit report by KPMG and has not responded to the said report.

The ministry was dismayed that THISDAY Newspapers could publish such a sensitive report without making any effort to verify the authenticity or otherwise of this allegation. For the record, the ministry is not in receipt of an audit report that it has not responded to."

It further said: "If the THISDAY Newspapers had cared to check its information with the ministry, it would have discovered that the only audit report that had ever come to the Ministry was a preliminary audit report which was received in 2008, which was acted on then, as it were.

The general public and the THISDAY Newspapers in particular should therefore note that a pending preliminary audit report was not part of the handing over notes received by the Minister of State for Power, Hajiya Zainab Kuchi, at the time she assumed office barely two months ago."

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