FGN FINANCIAL REGULATIONS
(REVISED TO JANUARY 2009)
A PAPER BY
EMMANUEL NWOKEDI OKEKE
CHIEF INTERNAL AUDITOR
AKANU IBIAM FEDERAL POLYTECHNIC, UNWANA
THE INDUCTION/ORIENTATION OF NEW STAFF OF AKANU IBIAM FEDERAL POLYTECHNIC, UNWANA
Every public servant, whether newly employed or about to retire, is required to discharge his/her duties within the purview of the law, rules and regulations that guide the conduct of government’s business. Financial regulations are important rules and guides which every government worker must continuously observe and hallow in order to remain worthy to conduct government’s business on its behalf. Flagrant disregard for financial regulations is a precursor to your exit from service. Public officers are therefore enjoined to acquaint themselves with these regulations and other related laws dealing with public finance for proper guidance, more so as ignorance is not an excuse.
For avoidance of doubt, Financial Regulations are legal instruments that empower and guide all public officers in carrying out government financial transactions including the receipt, custody of and accounting for government revenue; the procurement ,custody and utilization of government stores and assets, and the disbursements of funds from the major funds of government.
PUBLIC OFFICERS IN-CHARGE OF GOVERNMENT’S REVENUE, ACCOUNTING, AND CONTROL
2.1 The Minister of Finance.
The Finance Minister issues from time to time financial regulations which shall be in accordance with existing laws and policies of government. The financial regulations so issued apply to all federal public service which comprise ministries, extra-ministerial offices and other arms of government (S.105). States and Local Government officers and staff should in like manner respect the provisions of the Financial Regulations as it affects them.
2.2 Accountant-General of the Federation
The Accountant General of Federation is the Head of the Federal Government accounting services and the Treasury. He has the responsibility for providing adequate accounting systems and controls in the ministries, extra-ministerial offices and other arms of government, amongst other duties (S.106).
2.3 Auditor-General for the Federation
The Auditor-General for the Federation is the officer responsible under the constitution of the Federation for the Audit and report on the audited accounts of the Federation including all persons and bodies established by law who are entrusted with the collection, receipt, custody, issue or payment of federal public moneys or with the receipt., custody, securities, stores or other property of the Government of the Federation. The Auditor-General has the power to examine and ascertain in such a manner as he may deem fit the accounts relating to public funds and property, and shall ascertain whether in his opinion all public monies received have been fully accounted for, and proper books of accounts kept, amongst a litany of other weighty duties (S. 108). In the case of the Polytechnic, the Chief Internal Auditor does similar duties for the Rector and Management.
2.4 Accounting Officer
The term “Accounting Officer” means the Permanent Secretary of a Ministry or Head of Extra Ministerial Office and other arms of government who is in full control of and is responsible for human, material and financial resources which are critical inputs in the management of an organization (S.111). In the Polytechnic, the Rector is the Accounting Officer.
2.5 The Head of Finance and Accounts
The Head of Accounts of a Ministry/Office/Unit performs duties including but not limited to ensuring compliance with Financial Regulations and accounting codes by all staff; ensuring adequate supervision of the disbursement of funds and proper monitoring and accounting for revenue and advising the Accounting Officer on financial matters as well as the more technical provisions of these Regulations and other Treasury and finance circulars (S.114). The Head of Finance and Accounts of the Polytechnic is the Bursar.
Free access to Books, Accounts, and Information
By virtue of the responsibilities and functions of the Auditor-General and Accountant-General or their representatives, they must be given free access, at all reasonable times, to books of accounts, files, safes, security documents and other records and information relating to the accounts of all federal ministries, extra-ministerial offices and other arms of government or units. They shall also be entitled to request and receive from members of the public service such information, reports and explanations as they may deem necessary for the proper performance of their functions (S.110).
Similarly, the Internal Auditors of the Polytechnic are to have free access to such information and records as stated earlier. You must not refuse to cooperate with such government officers while carrying out their duties at all reasonable times.
Pecuniary Responsibility of Officers
All officers are personally and pecuniarily responsible for the due performance of the financial duties of their Ministries/ Extra-Ministerial Offices/Units for the proper collection and custody of all public monies receivable by them, and for any inaccuracies in the accounts rendered by them or under their authority. The responsibility of the Auditor-General for checking and reporting any shortcomings in connection with public finance and accounts does not absolve any officer from his responsibility for complying or securing compliance with regulations within the scope of his own authority (S.124).
Similarly, delegation of responsibility, though allowable, does not relieve any officer of his responsibility should he delegate or entrust the performance of duties or any part thereof to his subordinate officer. He shall still be held accountable for the wrong actions or inactions of his delegate (S.125). So, the broader legal principle of “delegatum non corpus delegare” still applies here.
Revenue Collection and Accounting
The rules and procedures for collecting and accounting for government revenue which every staff that comes into contact with government revenue must follow are:
Issue official receipt, never use temporary or privately printed receipt
See to it that the payer signs or thumb prints the receipt s, where practicable.
Details of the transaction such as amount paid, purpose, rates, and quantities, etc, must be shown on the receipt which shall be written up in triplicates using double-sided carbon paper.
The payer should be issued the original one, the second copy to the cashier for use as cash book voucher, while the triplicate shall be retained in the book.
Where tickets are used as in buses, the counterfoil of each ticket shall be initialed by the issuing officer.
All revenue collected must be lodged into the appropriate bank account designated for it within 24 hours.
Alterations on receipts, payment vouchers, etc, are not permitted. When an incorrect entry is made on a receipt or ticket, it shall be cancelled and a new one completed. The cancelled receipt must be retained in the receipt booklet (S. 216).
If a staff who is not directly involved in the collection of money comes into possession of public funds in the course of his duties, he/she shall without delay lodge the money into the Polytechnic account with any of the approved banks, obtain letter and present to the Bursary who shall issue him with official receipts on submission of the teller. (S. 218).
(20%) of all Internally Generated Revenue are to be transferred into the CRF on or before the 15th of the month following the month of collection of the revenue (S.236).
Remittance of Valued Added Tax (VAT) and withholding tax must be made at the same time the contractor is being paid or not later than 21 days after deduction (SS. 234(ii) and 235).
6. Expenditure Budgeting, control, Accounting and Payments
} 6.1 Expenditure Budgeting
No expenditure may be incurred by any officer on any service unless it had been included in the annual budget/ estimates and until authority to incur such expenses has been received (S.301). This means that for you to request for the purchase of any equipment or payment for any item or service, it must be checked by the officer controlling votes to see if it was budgeted for. Otherwise, such requests may be turned down.
6.2 Expenditure Control
No disbursement of public funds falling within the votes of the Polytechnic may be made without the approval of the Rector and authorized by the Bursar or the officers acting for them (S.401)
It is the duty of the officer controlling vote to monitor the expenditure pattern of the Polytechnic to ensure they are in line with the Estimates/ Budget; and where any expenditure not in the estimates is noticed by him, he must without delay investigate fully and, if necessary, blow the whistle (S.402)
The Accounting officer may delegate control of expenditure to a subordinate and that subordinate shall keep a vote-book in the manner prescribed. No officer of the Polytechnic may incur expenditure without authority to incur expenditure issued to him/ her by the Rector in the form of duly approved PAF, TAF etc. Any officer making, allowing or directing any disbursement without proper authority shall be personally responsible for the amount involved and any officer whose duties involve account rendition shall be similarly held responsible for any inaccuracies in his accounts (S.401 SS.ii) and (S.409).
Whenever you come into contact with a serious irregularity, you must blow the whistle (S.409). Any officer responsible for signing and authorizing PVs shall be held responsible for any computational, casting or arithmetic errors and/ or irregularities or payment to wrong persons (S.410).
Officers authorized to sign PVs shall not be below the rank of Accountant-I or a senior Executive officer (Accounts). The Accounting officer shall furnish the internal checking section, internal Audit Department and the paying officer with the specimen signatures along with the list of relevant votes chargeable (S.411).
The Federal Government requires all officers responsible for expenditure to exercise due economy. Money must not be spent merely because it has been voted (S.415).
Officers controlling votes shall arrange to spread expenditure evenly over the year, else they shall be held liable for unauthorized expenditure in excess of the sum allocated (S.419).
6.3 Expenditure Accounting
The Minister of Finance and the AGF from time to time issue Financial Regulation, Treasury circulars and Accounting Manual to guide accounting officers
and their employees in accounting for their daily financial transactions. The purpose is for standardization of accounting procedures throughout the Federal services. Any variation must be approved by the AGF after due consultations with the Auditor-General (SS.501-504).
The approved Accounting code, Internal Audit guide and Treasury circulars issued by the AGF shall be circulated to all affected officers within the organization for their guidance and compliance (S.507).
No payments may be made for any item or service without raising a PV for it (S.601). Separate vouchers shall be raised for the payment for different sub-heads and services, e.g. Tetfund (S.602). All PVS must contain all the features of a valid PV as outlined in (S.603).
PVs must be typewritten or written in ink, not pencil. Total sum must be written in words and figures. Erasers or correction fluids are not allowed. A single, thick horizontal line must be drawn before and after Naira (N) figure. No space allowed; and where there is no figure, the word ‘NIL’ must be entered in the space (S.604)
All PVs must be passed to checking section for checking. The checking officer shall, if satisfied, stamp the PV “checked and passed” for payment (S.609). No alterations whatsoever on PV is allowed (S.610).
With effect from January 1, 2009, all payment except where exemption has been granted must be by e-payment (S.631). Cheques and cash payments are now prohibited (S.632) except on approval by the Ministry of Finance on recommendation by the Accountant General of the Federation.
No official bank accounts shall be opened for government business unless authorized by the Accountant General of the Federation and such approved accounts shall be opened under official designation (S.701).
Only three (3) bank accounts are allowed for each establishment namely: salary account, overhead cost account, and revenue account. No other bank account shall be opened without the express approval of the Accountant General of the Federation. Multiplicity of bank accounts beyond the afore-mentioned three is prohibited (S.701).
Capital Account shall be maintained at Central Bank of Nigeria or any bank so designated by Federal Government and authorized by the Accountant General of the Federation. (S.702)
No government bank account shall be overdrawn; otherwise the officer responsible shall refund the money plus any bank charges to the bank (S.710). Personal money shall not be paid into government bank account, and vice versa. Such transaction is deemed to have been done with fraudulent intention (S.713).
Cash Book and Monthly accounts
Keeping of cash book in the form prescribed by the Accountant- General of the Federation in consultation with the Auditor-General is required (S. 801). The officer responsible for keeping the cash book shall promptly enter into the cash book all sums received via tellers or transfers or paid by him with all supporting documents intact (S.802). The cash book shall be ruled off and balanced daily (S.804). The cash book shall be signed at the end of each month by the sub-accounting officer whose signature shall be taken as certifying the correctness of the entries (S.805).
Bank reconciliation statements with the certified bank statements shall be prepared at the end of each month and shall be attached to the cash book.
Application for imprest should be made to the Rector stating the amount and purpose for it. All imprests approved by the Rector, authorized and issued by the Bursar shall be retained and recorded in a special imprest ledger (S.1005-6). The duty of maintaining the imprest cash and cash book shall not be delegated to an officer lower than Assistant Executive Officer (Accounts).
Imprest holders must duly observe all the regulations regarding the control of expenditure. The imprest may be used only for the purpose stated, and other public funds shall not be used for imprest purpose (S.1008). Reimbursement of imprest should be made only on submission of properly completed and receipted vouchers at least once a month (S.1010). All outstanding imprests must be retired on or before the 31st of December of the financial year in which they are issued (S.1011).
The accounts of imprest holders are subject to inspection by the Accountant-General of the Federation and the Auditor–General (S. 1013). In our own case, the Bursar and C.I.A or their representatives shall play that role.
Receipts / License books
Accounting officers or their representatives are responsible for control of receipt books and shall maintain their own stock and distribution registers in line with laid down principles. They are also responsible for the safe custody of revenue receipt- booklets, etc (S.1201). Receipt books must be printed in the form prescribed (S.1202). Receipt books issues must be in strict order, serially (S.1208). Individual revenue collectors must not hold a stock of receipt. Only the number required for daily use may be issued (S.1210).
An officer on first appointment may apply to the Rector and receive an advance not exceeding one month’s salary which shall be recovered in full in not more than three equal and consecutive monthly instalments (S. 1409).
Duty Tour Allowances
Any officer on official tour within Nigeria shall be paid DTA as follows:
Rector N20,000.00 per diem
CONTEDISS 13-15/CONPCASS 07-09 N16,000.00 06-12 / ‘ 01-06 N12,000.00
05 and below N5,000.00
Duty Tour Allowance does not need retirement.
Any officer on official tour abroad shall be entitled to estacodes as follows:
Rector $600 per diem
CONTEDISS 13-15/CONPCASS 07-09 $425 “
06-12/ “01-06 $381 “
05 and below $206 “
The above rates cover only lodging and feeding expenses. Transport and local runs shall be entitled at prevailing rates (S.1411-1412).
Officers on duty tour, locally or abroad shall not overstay the number of days/nights approved without obtaining prior approval from the Rector (S.1414).
Salary is the personal emoluments paid to an employee usually monthly for services rendered at a predetermined rate of pay (S.1501). See salary table. Every staff is eligible (S.1502)
The Bursar shall be promptly informed of any variation or counter pay likely to affect officers’ pay such as death, resignation, interdiction, suspension, dismissal, etc, in order to issue instruction to withhold pay without delay (S.1507).
An officer, mainly Registry staff, who first receives information such as above concerning another officer, shall pass the information promptly by passing a copy of such letter/notice to the Bursar for stoppage of the officer’s salary (S.1507). Any officer who fails to act as above shall be liable to surcharge and discipline for negligence and dereliction of duty (S.1508)
The Bursar shall be notified of increments on an officer’s pay. The Auditor needs not be notified when an officer is granted normal increment but shall be advised when an increment is withheld or deferred and subsequently restored (S.1509).
On cessation of appointment arising from termination or resignation, the salary of the officer shall be payable up to and including the day of cessation (S.1510). This shall be without prejudice to the provisions of the Public Service Rules and other extant laws.
It is a requirement that manpower audit be conducted at least twice in each financial year with representatives of the Accountant-General of the Federation and Auditor-General in attendance. This is likened to signing the monthly salary Control Register by heads of departments / units in the Polytechnic
Internal Audit is a managerial control which functions by measuring and evaluating the effectiveness of the internal control system in an organization (S.1701).
It is the duty of the Rector to ensure that an Internal Audit Department is established to provide a complete and continuous audit of the accounts and records of revenue and expenditure, assets, allocated and unallocated stores, where applicable 4(S.1702).
The existence of an Internal Audit Department shall not divest any member of the Polytechnic of the individual responsibilities placed on him, neither shall it obviate the necessity for normal departmental checks.
The Accountant-General shall ensure that a suitably competent accountant is placed directly in charge of the Internal Audit Department. The Internal Auditor shall be directly responsible to the Rector for the detailed audit of the accounts and records and for the examination of the systems and procedures in force (S. 1703).
All vouchers must pass through pre-payment audit and no payments may be made without passing through Internal Audit (S.1705).
Internal Audit staff shall not be assigned accounting duties within the Polytechnic unless he/she is permanently re-deployed to the Bursary. Furthermore, all officers who have previously worked in the Bursary shall be precluded from taking up audit duties within the Polytechnic (S.1709).
The Internal Auditor shall have free access at all reasonable times to stores and store records to carry out independent audit (S.1715).
Other provisions of the Financial Regulations like control of government vehicles, boarding of unserviceable vehicles, assets and stores, as well as public procurement procedures for transparency in award of government contracts deserve mention, even though time does not permit detailed discussion on them. Officers are therefore advised to acquaint themselves with all sections of the Financial Regulations and other relevant laws before engaging in related activities.
Summary and Conclusion
The Financial Regulation is a document of about 266-pages. It is impracticable to think that every detail of such can be exhaustively discussed in hours. What we have succeeded in doing today is drawing your attention to the more salient, more frequently occurring issues therein. Your duty remains to source for the document on your own and familiarize yourselves further in order to remove yourselves from the pitfalls of ignorance.
Ladies and gentlemen, we should be thankful to God and to Management for giving us this opportunity to be so informed. He that is not informed is deformed. Now that we know the rules to observe, we should strive to avoid going against them so as to keep being worthy of our calling, since non-compliance attracts sanctions amongst other disciplinary measures.