Yearning for sound Fiscal Responsibility

Fundamentals for good governance

Government and Citizens' Groups in Kaduna state have teamed up to engender effective budget tracking and implementation to create the enabling environment for increased internally generated revenue (IGR), in accordance with International Public Sector Accounting Standards (IPSAS).

This was the fallout of a three-day eye opening event, facilitated by Partnership to Engage, Reform and Learn (PERL-ECP), in collaboration with the Kaduna state government. The engagement touched on the urgent need to conduct budget trend analysis across key sectors - Economics, Social, Law/Justice as well as Administration, including audit report, all aimed ultimately at putting Kaduna state in good stead for sustained economic growth.

Addressing participants drawn from government and citizens' groups, Mr Timothy Effiong, a Public Financial Management Consultant, maintained that even in Kaduna a state that is very policy-driven, there exist gaps in general administration which tend to dislocate effective budget implementation. "Governance overheads in some cases are higher than the budgets of some Ministries, Departments and Agencies (MDAs) in the state" Effiong disclosed, adding that to reverse the trend, "conscious efforts are currently being made to suppress overheads so as to accommodate social infrastructure, especially for people with disability.

While picking holes with the quality of internal control in the Accountant-General's office, the consultant called for the creation of a cadre for internal audit and periodic capacity building for internal auditors in the state. He reasoned that making internal audit independent of the Accountant-General's office would not only enhance fiscal discipline but would also infuse into the system, procurement planning by MDAs to increase budget releases, thereby halting unnecessary returns of monies to treasury.

Effiong remarked that a situation where some MDAs receive their releases late was counterproductive, emphasizing that there should be procurement planning to ensure that budget releases follow due diligence and international best practices.

Earlier, participants, were briefed on why state financial report should be IPSAS compliant because a cash based IPSAS is different from the accrual IPSAS. This, according to our findings is because financial regulations control the financial and accounting matters, giving the fact standards are the body of rules guiding financial administration - when service is rendered there is accrual, meaning that Financial Statements must have names, otherwise known as the entity concept.

In the not too distant past, every nation had it's own financial standard which has now been harmonized into two standards. There is now convergence and as long as it complies with IPSAS, the nomenclature does not matter, since IPSAS is not profit-oriented. International Public Sector Accounting Standards Board(IPSASB)- provides comprehensive information for public sector financial management and decision-making process to ensure the following:

*preparation of financial statements and financial position;

*components of accrual based financial statement; and

*financial statements of government must be business-oriented even though it does not declare profit;

The fact that Nigeria has been a signatory to IPSAS provision since 2014 makes even obligatory for her to fully comply with IPSAS provisions to detect and punish fraud and crime as stipulated by Fiscal responsibility Act. The meeting urged Auditors to do more in area of detecting and preventing fraud in government rather than window dressing of accounts to cover fraud.

Highlight of the Kaduna 2019 Budget Postmortem with Government and Citizens' groups was the review of this year's budget as well as sectoral allocation.

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