NEITI defends auditors

NEITI Logo
NEITI Logo

The Nigeria Extractive Industries Transparency Initiative (NEITI) today rose in a spirited defence of its choice of two indigenous firms it selected recently to conduct audits in the country’s extractive industries.

Sada Idris & Co. was selected to conduct the oil and gas industry audit for the period between 2009 and 2011 for a fee of N226.6 million, while Haruna Yahaya & Co. was to conduct the first solid minerals audit for 2009 and 2010 at a total cost of N137 million.

But a flurry of criticisms have trailed the announcement of the two firms, particularly from civil society groups, which accused the agency responsible for promoting transparency and accountability in the country’s extractive industry of lack of transparency in the handling of the entire selection process.

The groups also expressed reservations over the technical competence, experience and capacity of the two firms to handle a complex assignment as the audit of the country’s oil and gas industry and the solid minerals sector.

President, Niger Delta Budget Monitoring Group (NDEBUMOG), George-Hill Anthony, said the lack of involvement of civil society and the media as observers in the selection process may have compromised the core pillars of the Extractive Industries Transparency Initiative (EITI) openness, transparency and accountability in all its activities. 

But, NEITI, through its Director of Communications, Ogbonnaya Orji, said the award process met all the requirements stipulated in both NEITI Act and Public Procurement Act (PPA), as a total of 22 expressions of interests (EOIs) were harvested for the oil and gas audit, out of which nine were prequalified and issued Request for Proposal (RFP) for technical and financial bids. He said only eight turned in the final bid at the expiration of the deadline.

For the solid minerals audit, Mr. Orji said nine firms were shortlisted and issued with RFP from a total of 26 EOIs, out of which only four met the deadline for the submission of bids.

All the bids were subjected to a seven-man committee technical evaluation based on quality and cost of proposals in line with Bureau of Public Procurement (BPP) bidding regulations.

The opening of EOIs, Technical and Financial bids were observed by large pool of media and civil society organizations, as well as representative of the bidding firms.

Contrary to his earlier statement that “the opening of EOIs, technical and financial bids were observed by a large pool of media and civil society organizations as well as representative of the bidding firms,” Mr. Orji clarified that the exercise was witnessed by only Publish What You Pay (PWYP) Nigeria and Civil Society Legislative Advocacy Centre (CISLAC).

But, National coordinator, Publish What You Pay Nigeria, Nwadishi Faith, whose group was listed as one of the two that attested to the transparent conduct of the selection, denied that the process was open and credible.

“The choice of Sada, Idris and Co “Chartard” accountants firm as the auditors for the oil and gas to an amount of ?226.6M is a showcase of this grand fraud going on in the “transparency house” Ms. Nwadishi said.

 “Even though the process was open till the bids were submitted, the process of evaluation and selection was done in secrecy by the Seven-person procurement committee made up of staff of the secretariat as against the principles of work in the EITI that must have in its composition for such a very sensitive responsibility, government, CSO and industry players.”

She said investigations had revealed that the same four organisations selected for the solid minerals audit were the same that emerged for the oil and gas audit amid “allegations of manipulation of figures to ensure that the ‘chosen one’ appear to have the highest scores.”

According to PWYP boss, the only credential that may have recommended Sada Idris & Co. for the job may have been that it conducted the NEITI in-house audits at least twice, pointing out if it claimed otherwise, it should have been able to post a long list of clients on its website, http://www.sadaidrisco.com.

 “The firm that claims to have a long list of clients cannot showcase even one on their website, there is no address nor telephone number to reach the ‘419’ auditors in whose hands they have put the audit of the oil and gas ‘cabalised’ sector in Nigeria.

“Who are the partners of the firm? Who have been their clients? Who conducted the due diligence on the audit firms before their recommendation for approval? Who were the members of the committee that conducted the entire process of procurement? Can NEITI share with civil society the minutes, reports of the evaluation committee, the entire process of nomination and eventual recommendation of these auditors who have been procured to conduct the most important audits in this country?” she queried.

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