Audit observed that:
i. A Contract was awarded to a company for the restoration of power supply to Tin Can Island Port, Lagos at a Contract Sum of N339,980,023.30 through award letter reference No. HQ/AGM/(E)/CON/E.7/T.14/278 of 12th August, 2009 with 16 weeks completion period.
ii. The Scope of work includes the following:
a. Supply and laying of HT and LT armoured cables between sub-stations C, E, F, B and H.
b. Supply, installation and commissioning of high tension and low-tension panels in substations A, E, F, G&H.
c. Fabrication of non-corrosive metal plate structure to cover all existing holes along underground cable tunnels and manholes along the quay apron.
d. Testing of all the cables, panels and commissioning of the entire electrical ring network.
iii. The Bills of Quantities (BOQ) contained:
a. A lump sum provision of N2,500,000.00 (i.e. N500,000.00 each) was made for 11KV accessories consisting of cable gland termination kits, insulation materials and earthing for substations A,E,F,G&H but there was no details showing how the amount was utilized for the purpose;
b. A total provision of N2,500,000.00 (N500,000.00 each) was made in the BOQ and paid for tools, instrument laptop for diagnosis on HT and LT panels for substations A,E,F,G&H but physical inspection revealed that there was no evidence to show that such items were bought;
c. A total provision of 8,722,050.00 was also embedded in the BOQ under miscellaneous
d. The full contract sum had been paid with the release of 5% retention fee of N16,974,553.94 through payment invoice referenced HQ/CS/1059 of 26/7/2017;
e. Based on above payments, a total amount of N28,934,010.00 was added as estimated additional work (1 and 2) and the approval granted by the Authority before the execution of such additional work with the BOQ was not produced.
iv. Physical inspection carried out at the project sites showed that the project had been put to use by the Authority.
The Managing Director is requested to:
i. Account for the payment of a total amount of 13,722,050.00 (Thirteen million, seven hundred and twenty-two thousand, fifty naira.) on items iii(a-c) highlighted above to the contractor without detailed information/evidences showing how the amount was utilized.
ii. Justify the approval granted for the estimated additional works of N28,934,010.00 (Twenty–eight million, nine hundred and thirty-four thousand, ten naira).
iii. Remit the sum of N42,656,060.00 (Forty two million, six hundred and fifty six thousand, sixty naira) i.e. (N13,722,050.00 + N28,934,010.00) to the Treasury.
iv. Forward evidence of remittance to the Public Accounts Committees of the National Assembly, and
v. Otherwise, apply sanctions relating to irregular payment and unauthorized variation stated in paragraphs 3106 and 3103 of the Financial Regulations respectively.
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