Missing financial reports: no 2022 budget approval for ACC representatives
… swear to deal with NIMASA, FAAN, NIWA, other MDAs so as not to show up
… our income is not enough to pay the staff-Garba, head of the CAC
… Looking for a policy to make the CAC letter a condition for doing business with the government
By Levinus Nwabughiogu-Abuja
The House of Representatives said on Tuesday that there would be no budget allocation to the Trade Affairs Committee, CAC, for failing to make the appropriate payments to the Federation’s treasury between 2016 and 2019.
Instead, the Commission spent the funds it generated over the years on itself.
Feeling disappointed, the Chamber, through its finance committee, mandated the budget office and the office of the general accountant of the Federation to apply the pending directive when the Commission’s financial outstandings were settled by the Federation. commission.
The Chairman of the Committee, the Hon. James Faleke conveyed the directive when the Commission’s Registrar General, Abubakar Garba, appeared before them with a presentation during the ongoing interactive session on the 2022-2024 Medium Term Expenditure Framework (MTEF) and Strategy Paper. budget (FSP) in Abuja.
READ ALSO: No budget approval for ACC until financial report is submitted – Representatives
Noting that ACC expenses have always exceeded income, Faleke insisted that his budget allocation will be withheld until he submits his 2016-2020 financial report.
He said: “I worked in a private organization before coming to the House of Representatives, and they will always pay their expenses and not spend more than what they generate.
“In your case, you borrow money up front before the money even arrives, so you will need to submit your 2016-2020 financial report before you get a hearing for the 2022 budget.
“You spent what you don’t generate, this agency needs a complete overhaul to get back to what it is supposed to be.
“Today all registrations are done online, but you still have unbearable overheads, things need to change.”
Faleke also warned other government agencies that had not yet appeared before the Committee to do so in their best interests.
“We are coming to the end of our reflection on the CDMT / FSP 2022-2024 which was sent to us by the President and according to the directives of the Chamber. We have decided to stay on vacation to carry out this national mission.
“We have observed that some agencies avoid coming to present their documents to us and we want it to be very clear that any government agency that refuses to appear and defend its revenue profile and its expenses will be properly taken care of by the Chamber. . .
“We want to take this opportunity to appeal to the management of NIMASA. For NIMASA, this is the second time that we have made this announcement. They must send their documents and declare their income profile. FAAN is supposed to come here tomorrow and there will be no more room for postponement. They must come and defend their sources of income line by line.
“The National Lottery Trust Fund has to come here and stand up for the income they receive and the way they manage this fund. NDIC is supposed to appear before us today, but we haven’t seen them yet, Standard Organization of Nigeria, National Inland Waterways Authority are also supposed to appear before and they must appear before Thursday.
“Do not allow us to take are not acceptable to the agencies,” said the lawmaker.
In response to the revenue shortfalls, CAC Registrar Garba said internally generated funds were not sufficient to run the agency’s operations.
According to him, the Commission did not register a jump until his arrival on board.
He said the commission’s sources of income included company incorporation, business name registration, incorporated trustees, increase in share capital, registration of charges and mortgages, certified copies compliant, form sales and commission publication, compliance revenue, annual report filing, and other sources such as the procurement process.
He said: “Over the years we have operated in a very difficult environment and until last year our income could not support our expenses. For the first time since our inception, we were able to record a turnover of 19 billion naira.
“In 2018, we spent around 12.2 billion naira while achieving income of 11.2 billion naira. What happened was that we had to defer some of the liabilities. These liabilities were primarily retirement deductions, taxes and other statutory deductions that were not paid when due. This continued until 2020. We had to clear most of the backlog.
“Deductions were made, but they were not paid in the correct quarter because there was not enough money to support our operations. The same goes for taxes. What was happening was that the third party invoices were being paid.
“Until last year, there was not enough income to pay staff and other expenses. So we weren’t putting anything back until I took office in January of last year.
“We had an unpaid valuation of 435 million naira, which is an operating surplus due from 2014 to 2017. We paid for it. There was a valuation of N809 million for 2018 and 2019 which we also paid last year.
“We had back taxes for 2018 and 2019.
But our tax advisers were able to get us a reduction and we had to pay around 570 million naira. On the pension for the two years, we paid N1.2 billion. We were able to liquidate until March 2019 and we intend to pay the balance if we have any excess of our personnel costs.
“There’s a new system from the General Accountant’s office where a percentage of every money that falls into your account is counted against your operating surplus.
“Under the provisions of the Fiscal Responsibility Act, we are expected to spend our income to cover our costs and return the excess. But we never had a surplus until 2020 ”.
Asked about the number of companies registered in Nigeria and the compliance rate in terms of filing their annual return, Garba said they stood at 2 million.
“To date, we have nearly two million registered businesses in Nigeria.
“These companies are supposed to file an annual return every year. When they modify either the composition of their board of directors, or when they increase their share capital, or when they make a change, they inform us and pay certain fees.
“But the area where we had challenges before is their annual performance. Most businesses weren’t reporting, but we’ve come up with a way to enforce compliance and businesses are now sitting down. We’re getting to about 50 percent compliance. If you visit our portal now, it tells you if a business is active or inactive.
“Before now, someone will be making millions and not paying the N5000 they are supposed to pay to the CAC every year. Many Nigerians and foreigners are aware of this and before doing business with a company, they do a free research. The search shows you the company name, registered address and status. This restores sanity and many companies are getting ready to file their return.
However, he unveiled a plan to force companies wishing to do business with the government to present a letter from the CAC.
“We made a proposal on how to increase our income. We have presented a note to the Federal Executive Council to require any company wishing to engage in public procurement to provide a letter of agreement from the CAC before it can be qualified to do so.
“It’s similar to what you have with Pension and NSITF. This is still in sight and has not yet been considered. But we have other ways to enforce this complaint, ”he said.