Under-funding the Supreme Audit Institution Amidst the Rising Unauthorized Extra-budgetary Expenditures in Nigeria: Is Deliberate Under-funding a Fraud-concealing Device?

Abstract

The executive (federal government of Nigeria) has recently been accused by the lower legislative house of deliberately underfunding SAI (office of the Auditor-General of the Nigeria federation) in order to conceal fraud. The legislature was reacting to the erratic reduction of SAI’s budget from N1.9 billion to N100 million when illegal extra-budgetary expenditure of about N16 trillion occurs annually. This study was therefore, carried out to determine whether the executive can conceal fraud by deliberately underfunding the supreme audit institution. In order to fulfil the study objective and answer the question posed by the study problem, internet sources, journal articles and literature review were used to generate relevant data for the research. The study revealed that deliberate underfunding of SAI to conceal fraud and other emerging fraud concealing devices are additional challenges to the existing ones and that the accusation of the executive (the auditee) of deliberately underfunding SAI to conceal fraud is true only to the extent that SAI’s budget and finances are controlled by the executive. The study recommended that financial autonomy, improved executive capacity, use of proactive approaches to eliminate fraud concealing devices will minimize audit challenges ensuring that SAI is not also contributing to the challenges it is currently facing.

Keywords: Deliberate underfunding, supreme audit institution, unauthorized extra-budgetary expenditure, fraud-concealing device, the executive and the legislature.