KPMG to audit Arik Air’s finances

Five days after the Federal Government took over the distressed Arik Air, the new management has appointed KPMG, a world-class auditor, to undertake a forensic and diagnostic audit of the finances of the airline to ascertain the true status of its finances.

The Assets Management Company of Nigeria (AMCON) had on behalf of the Federal Government taken over Arik on Thursday last week following its huge indebtedness added up to over N300bn.

AMCON said on Sunday that about N10bn would be needed to return the airline to full and uninterrupted operations.

There are currently nine functional aircraft out of its 30-plane fleet size with the operations of the airline expected to be scaled down in line with the current capacity.

However, in a statement yesterday, AMCON said the review of the airline’s finances to be carried out by KPMG “will among other objectives cover the position of assets and liabilities, and their utilization; recording and utilization of loans, propriety of third party transactions; fraud controls over Procure to Pay (‘PtP’), Agents and Business Partners and Financial Reporting and Arik Airline’s financial position as at January 31, 2017”.

The statement disclosed that the report is expected to be delivered within 12 weeks.

It said, “We have hired KPMG to look into the financials of Arik with a tooth comb and advise us with verifiable facts on what went wrong with the airline. We need to do that because the outcome will help us plug the loopholes and stabilise the airline.

“The whole intention is to identify what went wrong with Arik to enable the new management to bring it back to full operations”.