Audit-Report-on-NNPC

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Investigative Forensic audit of crude oil revenues and remittances by NNPC (January 2012 – July 2013) G H I Amount Due ($52.88billion) Other costs not directly attributable to domestic crude oil ($2.81billion) Expected remittance ($50.07billion) NNPC (PPMC) does not claim subsidy retrospectively as done by other marketers. PPMC buys 445,000 bpd of domestic crude oil from the FGN. PPMC is expected to pay for the domestic crude oil 3 months after the purchase from the FGN. This period is to allow PPMC convert the crude oil to refined products, sell the refined products, and pay the FGN for the crude purchased, from the proceeds of sale of the refined products 4 . However, NNPC (PPMC) sells the refined products at a subsidised amount, and pays the FGN for the crude purchased less subsidy incurred during the sale of the refined products. Amount expected to be remitted to the Federation after deducting the total verified costs from the total revenues from crude lifting. i.e., C-D-E-F. After the submission of our initial report to the <strong>Audit</strong>or-General for the Federation on 28 November 2014, these costs were brought to our attention by NNPC; stating that it had understated its costs in the submissions made to the Senate Committee and had not included all the costs defrayed from the proceeds of domestic crude revenue in meeting its mandate in accordance with the NNPC Act. These costs comprise of what was incurred by NNPC and its loss making subsidiaries. Vanguardngr We obtained physical records of these costs and compared them to the Group’s accounting records on SAP. This is the total amount of revenue expected in the Federation Account after deducting H from G. 4 Obtained from discussions with NNPC and Revenue Mobilisation and Fiscal Allocation Commission Confidential information for the sole benefit and use of the <strong>Audit</strong>or-General for the Federation. PwC 24
Investigative Forensic audit of crude oil revenues and remittances by NNPC (January 2012 – July 2013) J NNPC Potential excess remittance ($0.74billion) This amount represents the additional costs incurred by the Corporation and its subsidiaries not funded from the proceeds of domestic crude oil sale. The Corporation claims the potential excess remittance was funded from proceeds of PMS sales for which the suppliers of the PMS are yet to be paid in cash or crude oil. Details of the affected suppliers that funded this potential excess remittance are yet to be provided by the Corporation. K Revenue Total amount remitted as traced to the Federation Account. remitted ($50.81billion) Vanguardngr Confidential information for the sole benefit and use of the <strong>Audit</strong>or-General for the Federation. PwC 25
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