Why SEC is yet to start Oando forensic audit

Nigerian oil company, Oando. [Photo credit: Guardian Newspaper]
Nigerian oil company, Oando. [Photo credit: Guardian Newspaper]

The delay in the forensic audit of Nigerian oil and gas firm, Oando plc, by the Securities and Exchange Commission, SEC, is caused by ‘payment to auditors and other logistic concerns’, PREMIUM TIMES has learnt.

A top official at SEC told PREMIUM TIMES on Tuesday that the regulatory body was working towards commencing the audit after the festive periods, that is in 2018.

The source, who spoke under strict condition of anonymity, also hinted at a few challenges being confronted by the body in the area of logistics and payments to be made to the external auditors.

The SEC had on December 5 notified Nigerians that the forensic audit of the company would commence, beginning from the next day of its notice. But PREMIUM TIMES reported on Monday that two weeks after the announcement, the regulator was yet to commence the audit.

“You know they (External auditors) are private sector people and this exercise too requires money. There may be concerns around payment as the auditors would want to have their payment in full. Some of them would even want 50 per cent upfront because of the fear of change in leadership,” the source told our reporter Tuesday afternoon.

“So SEC is working on the plans and more likely to begin after the festive periods.”

The source also assured Nigerians that the regulatory body would not compromise in its role at ensuring sanity in the market, adding that SEC had no other mandate but to cleanse the system.

“We have no other interest in this case; we are regulators, like (a) referee, and our interest is to regulate the market. I can assure you that the audit will be done,” the source said.

Oando had been thrown into crisis following the technical suspension of its shares by the Nigerian Stock Exchange, NSE. The NSE said it acted on the directive of the SEC, which on its part said it received petitions from stakeholders of the company containing allegations of gross misconduct against the management.

The SEC subsequently said it was going to conduct a forensic audit into the affairs of the oil company.


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In a statement issued on Sunday, Oando not only said it was yet to be approached by any auditors sent by SEC. It also said it is opposed the proposed forensic audit in order to protect the company against actions taken by SEC under the leadership of Mounir Gwarzo who is currently under suspension.

The statement, signed by its Chief Compliance Officer, Ayotola Jagun, and the head of Corporate Communications, Alero Balogun, said there is no basis for the institution of a forensic audit of the company by SEC.

The company said it will go ahead with its legal battle against SEC on the alleged findings and sanctions following an investigation into the oil firm.

The oil firm acknowledged the appointment of Abdul Zubair as the acting director general of SEC, saying it would provide opportunity “for a new and enduring relationship to be established.”

Efforts to reach Oando spokesperson, Ms. Balogun, on Tuesday proved abortive as she did not respond to repeated calls placed to her known number.


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