Federal Government has said it will address its negative net assets, as reported in 2021 consolidated financial statements, which is N39 trillion.

Accountant-General of the Federation, Dr Oluwatoyin Madein, who spoke at a retreat with Finance directors and Internal Audit directors in Abuja, attributed this gap to incomplete recognition, measurement, and uploading of legacy assets, despite adoption of International Public Sector Accounting Standards accrual since 2016.

“We still have negative net assets in our 2021 consolidated financial statements, which stood at N39 trillion,” she said.

To tackle this, AGF has directed MDAs to submit an inventory of assets by December 31. This is to evaluate and include these assets in Federal Government’s financial statements.

Dr. Madein noted importance of legacy asset rendition, saying the slow pace of asset reporting by MDAs has hindered the timeliness and accuracy of the financial statements. “Legacy asset management represents a tool for strengthening fiscal position and alleviating budgetary pressures,” she noted.

The AGF’s office has pledged to enforce compliance.

“By adhering to these directives, MDAs can contribute to the national interest while avoiding penalties associated with non-compliance,” Madein said.

Effective management of legacy assets is expected to yield numerous benefits, including better utilization or liquidation of underperforming assets, which could generate much-needed revenue. Proceeds from asset monetization could be redirected towards debt servicing, easing fiscal pressures. Additionally, this initiative is anticipated to foster a culture of responsibility among public officials, ensure proper maintenance of assets, and stimulate economic activity, thereby creating job opportunities.

An Executive Director at the Ministry of Finance Incorporated (MoFI), Mrs. Kemi Owonuni, stressed the importance of accurately representing the federal government’s investment assets. She pointed out the disparity between the well-documented liability side of the balance sheet and the underrepresented asset side.

“The over N33 trillion negative net asset liability is not well represented on the asset side,” she noted. MoFI’s mandate includes identifying, enumerating, and establishing the federal government’s investment assets, aiming to create a comprehensive national asset register.

“This register will act as a single source of truth for all federal government assets, enabling strategic oversight and management,” Mrs. Owonuni explained.