Nigeria will be forfeiting $4 million from a World Bank-funded loan after failing to meet critical auditing standards tied to a public financial management reform. The lost funds were part of the $103 million Fiscal Governance and Institutions Project, a credit facility from the International Development Association aimed at improving transparency and revenue administration.
According to a June 2025 World Bank restructuring document, the revenue assurance audit covering the Federal Inland Revenue Service (FIRS) and Nigeria Customs Service (NCS) for the 2018–2021 fiscal years failed to meet international auditing standards. As a result, the audit was assessed as “not achieved,” disqualifying the country from accessing the $4 million allocated for that performance-based condition.
The audit was one of ten key deliverables under the project that the Nigerian government failed to complete by the June 30, 2025 deadline. Consequently, the Federal Ministry of Finance requested a total cancellation of $10.4 million in unused and unearned project funds. This includes $0.9 million for technical assistance and $9.5 million tied to unmet performance targets.
Additional unachieved components include a $4.5 million Revenue Assurance and Billing System and $1 million for the creation of a National Budget Portal, for which no supporting documentation was submitted. The cancellation brings the project’s total funding down to $92.6 million, following an earlier $22 million reduction in June 2024.
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Despite missing several targets, the World Bank acknowledged improvements in revenue collection, citing a non-oil revenue outturn of 153% of the 2024 budget target—up from 64.9% in 2018. These gains were attributed to the exchange rate unification, improved tax systems, and automation of remittances.
Progress was also recorded in fiscal transparency, with ten reconciled fiscal data publications, surpassing the project goal of six. However, challenges remain in capital expenditure implementation and project evaluation, both rated below expectations. The final disbursement is now projected at $96.04 million, about 93% of the revised total.
