THE Independent National Electoral Commission, INEC, has indicted the ruling Peoples Democratic Party, PDP, and other political parties for not having audited internal financial statements.
According to INEC's executive summary of external auditors' reports on the accounts of political parties for the year 2011, signed by Acting Secretary, Mr Mustapha M. Kuta, 55 of the parties in existence then did not have prepared and audited accounts; and conventional books of accounts were not properly kept as required by Section 93 (2) of the Electoral Act, 2010.
Since then, the electoral umpire has de-listed 30 parties.
The only party that scored pass mark was the Action Congress of Nigeria, ACN, which according to the commission: "has an internal audited report and account for the year under review. Conventional books of Accounts were maintained. Budget and budgetary control were in place and the party has a well defined fixed assets register and membership register were fully in place. The party claimed that income amounted to N676,248,437 and it also claimed to have expended the sum of N464,699,974."
According to the report, the People's Party of Nigeria, PPN, had internal report and account for the year but they fell short of the standard required of a political party. And the party's conventional accounting records were not properly kept and maintained like the other 54 parties.
Apart from PDP, those found culpable include All Nigeria Peoples Party, ANPP; Congress for Progressive Change, CPC; All Progressives Grand Alliance, APGA; Labour Party, LP; and Democratic Peoples Party, DPP.
Advising the affected parties to do the needful, the INEC said maintenance of incomplete record of financial transaction in state and zonal chapters could lead to "omission or mis-statement of financial information. Lack of strong internal control procedures will result to operational inefficiency of the party. Lack of standard fixed asset register will result to the party not to be able to monitor and control its fixed assets."
INEC therefore tasked the PDP and other affected parties to "establish and maintain adequate necessary records and accounts of their financial transactions in state and zonal chapters so as to have a global view of the affairs of the parties. The parties should also install an effective internal control system for proper operational efficiency and control by management. Standard Fixed Assets and identification numbers should be kept and maintained by the parties."
Similarly, the commission's auditors observed that the CPC "does not have an Internal Audited Report and accounts for the year under review. Conventional Accounting Records were not kept and maintained by the party. The year's budget and budgetary control were not in place", adding that "the party does not maintain Fixed Assets and Membership Register for the period under review. The party claimed that its total income generated amounted to N304,874,536 and it also expended the sum of N363,570, 485."
Continuing, it expressed worry over such implications saying "when proper accounting records are not maintained, the actual true position of the party's financial statement may not be easily ascertained. Weak internal control system could lead to misrepresentation and operational inefficiency of the party's activities. Without adequate budget there is no basis to monitor and evaluate operational efficiency of the party's financial transactions."
In its recommendation, INEC called on the party "to write up all the relevant books of accounts from where its financial statements could be extracted for analysis and proper evaluation and monitoring. The party should maintain a membership register and endeavour to install a more effective internal control measure in compliance with the political parties finance manual and handbook."
Also, it chided the ANPP for failing to have an internal audited report for the year in review, saying "internal control procedures were weak."
It stated that "both fixed assets and membership registers were not updated. Budget for the year was prepared and maintained. Its income for the year amounted to N768,587,384, while it expended the sum of N893,404,420. The party's financial statement can be said to be true and fair and can be relied upon."
It recommended that "the party should improve on the filling system by computerization of the accounting functions for future transactions. An effective Internal Control System should be maintained and a comprehensive Fixed Assets and Membership Registers be introduced."
For the Action Congress of Nigeria, ACN, the commission commended the party for proper recording.
It said "conventional books of accounts were maintained. Budget and budgetary control were in place and the party has a well defined Fixed Assets Register and Membership register which were equally in place. The party claimed that its income amounted to N676,248,437 and it also claimed to have expended the sum of N464,699,974."
While it stated that the financial statement of the party can be said to "be true and fair and the account can be relied upon", the commission noted that "a budget in place indicates there is solid financial plan on ground."