Auditors cast doubt on continued existence on NNPC
Last week, Nigeria’s state oil company, the Nigeria National Petroleum Corporation, NNPC released it’s audited financials for 2019 which showed that it reduced its loss by 99.7 per cent from N803 billion in 2018 to N1.7 billion in the period under review.
Despite this, the report also showed that NNPC’s suffered asset deficiencies of up to N4.4 trillion as a group within the period under review.
As a corporation, the oil firm’s liabilities exceeded its assets by N1.1 trillion.
This prompted auditors including PriceWaterhouseCoopers, SIAO Partners and Muhtari Dangana and Co. to express significant doubt on the continued existence of NNPC as a going concern considering the level of liability being shouldered by the oil firm.
Explaining the material uncertainty relating to going concern at the oil firm, the auditors expressed doubt on the group and corporation’s ability to continue as a going concern.
They said: “We draw attention to note 42 of the consolidated and separate financial statements, which indicate that the group recorded a net loss of N1.8 billion (corporation: net loss of N107.8 billion) during the year ended 31, December 2019.
“As at that date, the group’s current liabilities exceeded its current assets by N4.4 trillion (corporation: N1.1tn).”
It added that the events or conditions along with other matters ‘indicate that a material uncertainty exists that may cast significant doubt on the group and corporation’s ability to continue as a going concern’.
The auditors, however, noted that their opinion was not modified.