The Federal Government has said it is determined to reduce the volume of outstanding lapsed loans from $18 million to $7 million, a reduction of about 61 per cent.
Lapsed loans are those that have expired or are no longer active, often due to non-compliance with loan terms. This can result in the suspension of new borrowing, often due to a failure to meet the required standards for loan implementation and reporting.
The Accountant General of the Federation, Dr. Shamseldeen Ogunjimi, who stated this on Tuesday in Abuja at a workshop for Heads of Projects Financial Management Units and Coordinators of World Bank Funded projects, also informed that the office has put in place a series of critical management reforms to enhance transparency, accountability and efficiency in the execution of World Bank Funded projects across Nigeria.
“We will continue to address the issues that hinder projects from attaining high ratings, including lapsed loans and undocumented advances. We are collaborating with the World Bank on the drive to reduce outstanding lapsed loans from $18 million to $7 million,” he said.
He noted that the office of the Accountant General of the Federation (OAGF) was determined to ensure transparency and accountability in donor-funded projects, particularly those funded by the World Bank.
The AGF stated that the workshop is to deliberate on enhancing transparency and accountability in the financial management of donor-funded projects.
According to him, “These values are the foundation upon which we build trust, ensure effective use of resources and achieve our project development objectives.”
He also disclosed that the OAGF has developed a Financial Management Manual (FMM) to guide the execution of financial transactions in projects.
He noted that all project Coordinators, Projects Accountants, Heads of Project Financial Management Units (PFMUs) and other relevant stakeholders are encouraged to use the FMM for their implementation to minimise infractions, improve performance and sustain favourable ratings with the World Bank.
Dr. Ogunjimi disclosed that the World Bank has commenced the roll-out of its “Funds Chains” system, a ground-breaking blockchain-based platform designed to enhance transparency, accountability and efficiency in the management of development project funds, starting with six projects.
He said the OAGF and the World Bank have agreed that project Financial Management staff will not be removed six months before the closure of the projects, to guard against lapsed loans and undocumented advances.
He noted that the aim is to ensure that the transition of project financial management staff is handled effectively to avoid disruptions to implementation.
“In addition to that, for the sake of continuity of project implementation, the new project officer should be allowed to stay with the old management officer for a period not less than three months to avoid project stoppage,” he said.
He noted that project coordinators will continue to receive letters from his office on outstanding lapsed loans and undocumented advances.
“Therefore, I urge all project coordinators and project financial management units (PFMUs) to prioritise documentation, refund of lapsed loans and adherence to World Bank agreements,” he advised.
While emphasising the importance of collaboration, transparency, and accountability in project Management,
Dr. Ogunjimi urged accountants to work together to strengthen the system, building capacity and delivering results in tandem with the Renewed Hope Agenda of the present adminstration.
Earlier in his welcome address, the World Bank Country Director in Nigeria, Mr Mathew Verghis, represented by Mr Akram Elshirbegy, expressed delight at the giant strides made by the Accountant General of the Federation.
He called for continued OAGF support for the continuity and survival of World Bank projects in Nigeria.
