The National Agricultural Insurance Corporation (NAIC) is facing a major accountability crisis after an audit uncovered at least N3.87 billion in financial irregularities across personnel payments, procurement, contracts, asset management, revenue collection, and other expenditures.

The revelations are contained in the 2024 Annual Report on Non-Compliance and Internal Control Weaknesses in Ministries, Departments and Agencies (MDAs) by the Office of the Auditor-General for the Federation (OAuGF).

The audit paints a disturbing picture of weak financial controls at the corporation, exposing questionable payments, unapproved contracts, missing government vehicles, premature disposal of public assets, revenue leakages and expenditures allegedly made without adequate documentation or evidence of work done.

Even more striking, the NAIC management reportedly failed to respond to any of the audit observations, leaving the allegations unanswered.

The OAuGF consequently recommended that the management recover the funds and remit them to the Treasury, warning that failure to do so could attract sanctions.
One of the largest breaches identified by the auditors was the award of contracts worth N1.09 billion without confirmation by the political head.

The corporation was also found to have awarded N542.29 million worth of contracts to non-accredited training consultants, while contracts valued at N483.6 million allegedly breached conditions prescribed by the Bureau of Public Procurement (BPP).

In another procurement breach, NAIC acquired information technology equipment worth N130.25 million without clearance from the National Information Technology Development Agency (NITDA).

The auditors also identified N291.27 million in contract splitting and circumvention of approval thresholds. This practice could undermine procurement safeguards by deliberately breaking projects into smaller amounts to avoid higher-level approval.

The audit uncovered payments of N266.56 million to contractors without proper valuation and evidence of work done, resulting in what the auditors described as a loss of government revenue.

Another N154.46 million was reportedly paid for constituency and zonal intervention projects without approval from the relevant authorities.

There were also N10.89 million in irregular contract payments, while N4.21 million was incurred as extra-budgetary expenditure.

The auditors additionally found N14.47 million in payments without payment vouchers, raising questions about the documentary basis for the expenditures.

The financial irregularities were not limited to procurement.

According to the report, 56 NAIC staff were irregularly placed, resulting in excess salaries and arrears of N6.19 million.

The authority directed management to account for the money before the Public Accounts Committees of the National Assembly, reverse the promotions and recover and remit the excess payments to the Treasury.

The corporation was also indicted over N56.66 million in unapproved allowances, allegedly paid without securing the required evaluation and approval from the National Salaries, Incomes and Wages Commission.

Another N40.98 million was reportedly paid as domestic staff salaries to management staff, while N2.4 million was paid as Sallah bonuses to non-existent domestic staff.

The auditors also flagged N20.34 million in medical allowances paid to ineligible top management staff.

The management of government vehicles also came under severe scrutiny.

The audit found that vehicles valued at N98.68 million were prematurely scrapped and sold, while vehicles worth another N117.04 million were reported missing.

Together, the two findings represented N215.72 million in government vehicle assets caught up in the audit’s red flags.

Revenue management at the corporation was equally problematic.

The report identified N265.28 million in government revenue that was not collected, while the 36 states and the Federal Capital Territory collectively owed NAIC N1.99 billion.

The auditors also discovered N103.77 million worth of store items that had not been entered into ledger charges, potentially weakening the corporation’s ability to properly account for its inventory.

The report identified a series of questionable expenditures on official travel and allowances.

NAIC allegedly overpaid $3,587 in estacode allowance, while N35.37 million and $14,992 were spent on international travel without approval.

There were also irregular duty tour allowance payments of N19.56 million, another N9.55 million payment involving duty tour allowances and a further N3.34 million overpayment in the same category.

The corporation was also accused of making N17.62 million in irregular payments for diesel for personal use.

Other findings included N9.4 million in irregular management expense allowances, N5.77 million paid to staff and non-staff for personal social events, and N42.49 million paid before pre-payment audit.

The auditors further identified a N2.51 million violation of the Federal Government’s e-payment policy.
The audit also raised questions over insurance claims, identifying an irregular payment of $58,169.9.