allAfrica.com: Auditors Slam N.5bn Suit On Shell: “An accounting firm... has slammed a N500,000,000 suit against Shell Petroleum Development Company Limited (SPDC) over outstanding fees”: “The auditors averred that while the exercise was on, SPDC presented inaccurate data to the consultants…” (ShellNews.net) Posted 2 Dec 04
This Day (Lagos)
An accounting firm, S.S Afemikhe & Co. has slammed a N500,000,000 suit against Shell Petroleum Development Company Limited (SPDC) over outstanding fees due to it on the NNPC/SPDC/Elf/NAOC Joint Venture audit carried out between 1991 1996.
The firm of chartered accountants, which carried out value for money consultancy for the Nigerian National Petroleum Corporation (NNPC) on its upstream joint ventures, in a writ of summon and statement of claim marked suit No. FHC/L/CS/1097/04 and endorsed by Chief Charles Adogah, counsel to the auditors, is claiming against Shell the sum of N46,423,500 together with interest and N500 million in damages, arising from additional professional services they were engaged to carry out in respect of the audit.
The suit was filed at the Federal High Court registry, Lagos, on November 25, 2004
In its reaction however, Shell said it was ready to meet the accounting firm in court.
The consultants had been engaged in February 1997 by the NNPC, to carry out the value for money audit in all the corporation's joint venture oil partners.
The partners are SPDC, Mobil Producing Nigeria Unlimited, Chevron Nigeria Limited, Elf Petroleum Nigeria Limited, Nigerian Agip Oil Company and Texaco Overseas Petroleum.
The auditors averred that while the exercise was on, SPDC presented inaccurate data to the consultants. The oil firm was said to have later on requested for an opportunity to present new information and data for the consideration of the consultants at its own (Shell) expense.
The auditors claimed that this assignment dragged on indefinitely and that Shell mid-way on the assignment stopped honouring its payment obligation thereby leaving the unpaid sum the auditors were claiming as at December 16, 2002.
When contacted, the consultant's counsel, Adogah, confirmed the claim before the court and expressed surprise at the attitude of Shell in refusing to pay a consultant for work duly carried out.
According to him, it is a matter of serious concern and regret that what multinational companies can do in this country and get away with, they cannot even try in their country of origin or other countries for that matter.
"In fact, it is criminal negligence for any person, including a corporate entity for that matter, to give auditors inaccurate data," he said.
The suit was, however, silent on the details and sum of the misapplied funds that formed the basis of the claim that NNPC filed on Shell. All effort to contact the consultants failed as no one was willing to discuss the issue, directing all inquires to their solicitors.
Shell confirmed yesterday that it had received the writ of summon from the accounting firm, but denied claims that it deliberately did not want to pay for the job.
A senior official of the company told THISDAY that the issue between the parties "is basically over disputed invoices, rather than non-payment of fees."
"We will meet the plaintiff in court. But for now we are unable to volunteer any further comment because it will be subjudice to do so,"