Nigeria’s Accountant General of the Federation (AGF) says Legacy asset management represents a pivotal tool for strengthening Nigeria’s fiscal position and alleviating budgetary pressures.
Accountant General of the Federation Oluwatoyin Madein at the opening of a sensitization Retreat with Directors of Finance and Accounts (DFAs) and Directors of Internal Audit (DIAs) of Ministries, Departments and Agencies (MDAs) in Abuja disclosed that systematically cataloging and valuing legacy assets-long-term resources that have often been overlooked by MDAs can unlock substantial value that would otherwise remain dormant.
She said her office will initiate measures to enforce compliance and sanctions will be applied to non- complying MDAs.
Eight years into the adoption of International Public Sector Accounting Standards (IPSAS), accrual accounting standards by the Nigeria government, the country still has huge negative net assets in the region of N39 trillion reflected in her 2021 consolidated financial statement.
The figure was confirmed by Dr Oluwatoyin Madein at a retreat themed: “National Assets Register & the Strategic Importance of Legacy Assets Rendition in the Implementation of IPSAS accrual basis accounting in Nigeria”.
“It is imperative that we adopt a holistic approach to fiscal management, ensuring transparency and accountability in our financial reporting”.
“You may recall that Nigeria adopted IPSAS accrual accounting with effect from 1st January 2016 however till date many legacy assets are yet to be recognized, measured and uploaded.
Consequently we still have huge negative net assets in our 2021 consolidated financial statements which stood at 39 trillion naira”. Madein said.
Speaking on the importance of legacy asset rendition approach, she regretted the slow pace of rendition by the MDAs.
“This delay hampers the timeliness and accuracy of the consolidated financial statements and significantly impacts our ability to address the net asset deficit as expected MDAs are therefore urged to expedite action on the rendition of legacy assets”
On role of her office in the scheme of things, AGF said: “The Office of Accountant General of the Federation, as we all know, is the treasury office of the federal government of Nigeria.
“All disbursement receipts of revenue, administer payments are made, assets are acquired, accounts are rendered consolidate accounts of all MDAs and prepare financial statements, annual financial statements of the federal government each year.
The office collates information, financial information, that will lead to the preparation of these financial statements. So the office handles all these.
In the process, the valuation of assets to be included in the annual financial statement is one of the key values that the financial statement is required”, she said.
She said her office was in the process of collating national assets owned by the Federal government.
“we are in the process of collating the national assets that the federal government owns. And that is exactly why we are here, to discuss more on how to do it and achieve that before the end of the year.”
“Its an annual thing, but for now, because it has been due for some time, and it was observed that some MDAs have not been able to render, that is exactly why we are here, to come together in this workshop to discuss on the way forward. So it is expected that after this workshop, we will all go back and submit the inventory of assets, which will be evaluated and placed in the financial statement on or before December 24, 2024.”
Speaking to the country’s liability position, she said the country has N33 trillion in negative assets.
“Just like it was mentioned, when you prepare assets- a financial statement, especially the statement of financial position, you either end in negative assets or negative liabilities.
“You have negative assets when your liability is less than your net assets. And you have net liabilities when your liability is over and above the assets. Currently, we have about N33 trillion in negative net assets.
“That is net liability, which we have been compiling. Before now, we have gotten to about N18 trillion. It’s expected that at the end of this exercise, we will get to net assets at the end of the day”, she assured.
The workshop in partnership with the Ministry of Finance Incorporated (MOFI) targets to equip participants on how to identify, enumerate and establish what the federal government owns and ultimately improve the account books of the nation.
Olusola Akintonde
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