PICA: Why it won the 5 Star Medal for Efficiency

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PICA: Why it won the 5 Star Medal for Efficiency

The Presidential Initiative on Continuous Audit (PICA) was one of the sixteen recipients of prestigious awards of recognition for excellence at the just concluded Northeast Star magazine/Arewa Journalist Forum awards which took place on the 22 December at the Merit House, Maitama,Abuja.PICA  was considered for the award because of its efficiency and efforts in blocking wastage and leakages in government expenditure for the Buhari administration.

The Presidential Initiative on Continuous Audit (PICA) is one department in the Finance ministry that is rather quiet and doesn’t like to make noise about its achievements. As a result its numerous achievements are under reported and under celebrated by the Buhari administration and the people of Nigeria. Yet this same PICA was able to save costs in running government, blocked leakages and successfully coordinated the whistleblower policy. The intensive and diligent forensic audit of IPPIS and nominal roll carried out by PICA led to monthly reduction of personnel cost (salaries) from N151,000,000,000.00 (One hundred and Fifty-One billion Naira) in February 2016 to N138,000,000,000.00 (One hundred and Thirty-Eight billion Naira) by August, 2016. Similarly, the exercise led to reduction in pension cost from N I 5,000,000,000.00 (Fifteen billion Naira) to NI4, 500,000,000.00 (Fourteen billion, Five hundred thousand Naira) monthly. This reduction has since been sustained through efforts of the Honorable Minister of Finance.

How the Magic Wand was conceived

The Buhari Administration, in its effort to strengthen results-based management in the public sector, has sought to implement a Continuous Audit Process. The primary focus of this Program is to put systems and frameworks in place over finance and spending of government revenue. Its goal is to maximize the utilization of the resources through continuous assurance, so as to ensure that requirements for improved efficiency, effectiveness and accountability are met.

The approval for the establishment of a Presidential Initiative on Continuous Audit (PICA) was granted by the Federal Executive Council (FEC) on the 9th March, 20I 6.This initiative was a follow-up to Mr. President’s 2016 Budget Speech to the National Assembly, which sought to ensure full accountability of all public funds expended under his watch. He stated that: “We will also strengthen the controls over our personnel and pension costs with the imminent introduction of Continuous Audit Process. These initiatives will ensure that personnel costs are reduced. Our Commitment to a lean and cost effective government remains a priority and the initiatives we are introducing will signal a fundamental change in how Government spends public revenue.

What is Continuous Audit

Continuous audit is an internal process that examines accounting practices, risk controls, compliance, information technology systems and business procedures on an ongoing basis. Continuous audits are usually technology-driven and designed to automate error checking and data verification in real time. A continuous audit driven system generates alarm triggers that provide notice about anomalies and errors detected by the system.

The Buhari Administration launched PICA to exercise oversight responsibilities over internal audit practices in the public service through coordinating, facilitating, and setting standards; providing quality assurance and supporting capacity building for good governance and effective risk management. PICA has mandate to check and oversee:

All Federal MDAs irrespective of their legal status;

 All budgetary and extra-budgetary receipts and payments of the Federal MDAs; and

 Use of various control monitoring techniques to achieve financial accounting, reporting and risk management objectives.

 To identify areas of wastages and leakages in personal cost, overhead cost and capital supplementation, pensions and gratuities, service wide vote, statutory transfers, debt servicing among others;

 To ensure all Federal Government receipts and payments are subjected to financial rules and regulations

 To ensure that relevant provisions of the extant rules and laws are duly observed in the generation, collection and remittances of all revenues including grants, donations, aids, donor funds, taxes, loans etc ;

 To identify deficiencies and discrepancies, trigger alarms, and route same to appropriate Authorities for further action;

 To verify controls being implemented in all MDAs, assess risk exposures and provide reasonable assurance to the area of focus;

 Review the payroll and other personnel costs of all MDAs in the Federal Public Service with a focus on identifying possible leakages, inefficiencies and extra costs that can be trimmed down;

 Assess the methodology of payroll and personnel costs with a view to creating substantive tests and identifying appropriate/suitable control measures used in monitoring, evaluating and managing excesses;

 Summon, visit and meet with accounting and administrative officers (across levels) of the respective MDAs for the purpose of verifying details of their payroll and other personnel costs;

 Obtain details of overhead cost warrants as issued by the Honourable Minister of Finance for the MDA under review;

 Obtain overhead cost expenditure report on GIFMIS showing spending for a warrant period under consideration;

 Evaluate pattern of spending to determine whether individual expenditure items are in line with the sub-heads as per the uploaded warrants for the period under review;

 Analyze and generate report on trend analysis of revenue collection and accounting;

 Review of previous monitoring reports;

 Verify records of revenue generated; and

 Confirm loans repayments;

 Review of deduction status; and

 Confirm interest due, penalties & other charges on debt servicing.

 Verify and ensure cost-benefit of capital expenditures before additional spending is allowed;

 Facilitate and ensure that capital expenditure decisions are taken expeditiously with necessary rigor;

 Guaranteeing value for money in capital expenditure allocation;

 Conduct stocktaking of all Assets & Liabilities of MDAs;

 Conduct physical verification of MDAs’ Assets and reports on its findings;

 Verify liability claims by vendors, contractors, public servants to ensure authenticity before authorization for payment;

 

Dr. Mohammed Kyari Dikwa,Secretary PICA has been coordinating and managing the affairs of PICA since its inception.

 

Major successes and achievements of PICA

The Continuous Audit Team conducted investigations into infractions committed by some staff of PTAD. This investigation led to disciplinary action against five (5) top management staff of PTAD including a former Director-General

PICA in the course of its investigation discovered that 196 Foreign Service officers continued to receive salaries after exiting the Federal Service. The sum of N 192,000,000.00 (One hundred and Ninety Two million Naira)was collected by these officers as salaries even after leaving the service. The case is still being investigated by the EFCC for recovery of aforementioned funds on completion of the investigation.

Prior to the establishment of PICA, the personnel cost across Federal MDAs was high, making it difficult to channel enough funds to develop needed critical infrastructure. The intensive and diligent forensic audit of IPPIS and nominal roll carried out by PICA led to monthly reduction of personnel cost (salaries) from N 151,000,000,000.00 (One hundred and Fifty-One billion Naira) in February 2016 to N138,000,000,000.00 (One hundred and Thirty-Eight billion Naira) by August, 2016. Similarly, the exercise led to reduction in pension cost from N I 5,000,000,000.00 (Fifteen billion Naira) to NI4, 500,000,000.00 (Fourteen billion, Five hundred thousand Naira) monthly. This reduction has since been sustained through efforts of the Honorable Minister of Finance.

The Federal Government in its efforts to ensure steady supply of petroleum products nationwide took measure aimed at settling outstanding debts owed to members of the Petroleum Products Marketers Association of Nigeria (DAPMA). An inter-agency committee under the leadership of the Presidential Initiative on Continuous Audit (PICA) was set up to verify the claims. Other members of the committee are the Nigeria Customs Service, Debt Management Office, DPRRA and BOF. The committee which has verified and recommended some payments thus far has made remarkable savings for the Federal Government which runs into billions of Dollars.

Another major success of the Buhari administration through PICA is the whistleblower program. The Federal Government said it recovered more than N143. 89 billion from corrupt officials through the implementation of the Whistleblower policy.

PICA in the course of its investigation discovered that 196 Foreign Service officers continued to receive salaries after exiting the Federal Service. The sum of N 192,000,000.00 (One hundred and Ninety Two million Naira)was collected by these officers as salaries even after leaving the service. The case is still being investigated by the EFCC for recovery of aforementioned funds on completion of the investigation.

The Presidential Initiative on Continuous Audit (PICA) disclosed this in a report made to this medium. The report showed that government had successfully recovered N7.8 billion, 378 million dollars and 27,800 pounds sterling.

According to the report, since the policy was introduced in 2016 to fight financial crimes and corruption, PICA has received 8,373 tips.
The report said 1,231 tips received were on financial crimes.

It further showed that the Federal Government was able to investigate 791 cases out of which 534 were completed. It also showed that the Federal Government had also been able to save N208 billion through the payroll audit of its Ministries Department and Agencies (MDAs). According to the report, N97.94 billion was saved in 2016, while N110.46 billion was saved in 2017.

It said the saving was from the recovery of salaries paid to ex-diplomats, reduction in personnel costs of MDAs enjoying non regular allowances.

 

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