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Introduction
Several policies and strategies have been put in place by previous administrations on how to
ensure effective and efficient Management of Public Finances in Nigeria but to no avail, part of
which is the introduction of Treasury Single Account (TSA) which if well implemented is
believed to serve as a panacea of mismanagement of Public funds. The TSA formally became
operational on 2nd April, 2012 following the go-live of Government Integrated Financial
Management Information System (GIFMIS). Against the foregoing background has emerged the
leadership of President Buhari with a widely acknowledged distinctive leadership character,
integrity and zero tolerance for corruption, along with an observable disposition towards an ethos
of putting the interest of the collective over and above that of the individual. Infact, he has
defined corruption as the greatest form of human rights violation and just within the short span of
three months, his body language has produced positive results (Odekunle, 2015). It is also with
this spirit that directives were given to all ministries, departments and agencies on total
compliance to the treasury single account that was hitherto introduced by the last administration
but with little or no compliance. Given the magnitude of corruption that had bedeviled Nigeria’s
development, it is the contention and objective of this paper to examine the single treasury
account as a tool for managing Public Finances in Nigeria.
On Sunday, August 9, 2015 President Muhammadu Buhari directed all the Ministries,
Departments and Agencies (MDAs) to close all their accounts domiciled in the commercial
banks and transfer them to the federation account and gave September 15, 2015 as deadline for
total compliance. The Independent Revenue e-Collection Scheme is implemented under Treasury
Single Account (TSA) initiative, which requires that government revenue collection, is put into a
single account for proper cash management.
CONCEPTUAL FRAMEWORK
Treasury Single Account (TSA)
TSA is a unified structure of bank accounts enabling consolidation and optimal utilization of
government’s cash resources.
It is a bank account or a set of linked bank accounts through which government transacts all its
receipts and payments and gets consolidated view of its cash position at any given time (Kifasi,

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2015). Onyekpere (2015) opined that TSA is a process and tool for effective management of
government’s finances, banking and cash position. In accordance with the name, it pools and
unifies all government accounts through a single treasury account. Chukwu (2015) defined a
treasury single account (TSA) as a network of subsidiary accounts all linked to a main account
such that, transactions are effected in the subsidiary accounts but closing balances on these
subsidiary accounts are transferred to the main account, at the end of each business day.
Public Financial Management
It encompasses all the activities involved in resource generation, resource allocation and
expenditure management in government in order to achieve efficient and effective delivery of
public goods and services. These activities include budgeting, financial controls, accounting,
financial reporting, internal and external auditing and actions taken on audited accounts.
Ola and Offiong (2008), define public financial management as “the measures put in place to
control people’s money or funds.” You will note that the word ‘public’ means the people while
‘finance’ connotes funds or money. The management of public funds is known as public
financial management. Ekpung (2001), also defines public financial management as the
management of the flow of money or financial resources through an organization (public),
whether it is a company, a school, a bank, or a government agency. The actual flow of money or
financial resources as well as claims against money in a judicious way is its concern. Public
financial management is a specialised, functional area found under the general classification,
public administration and finance.
How does it operate?
In order to maintain the autonomy of MDAs in annual budget execution, a centralized TSA
domiciled at the Central Bank of Nigeria with decentralized transactions processing system was
approved in 2011. There is flexibility for sub-accounts to be maintained if considered absolutely
necessary but must be linked to the TSA. Consequently, the Consolidated Revenue Fund
Account is designated as the Main TSA. By this arrangement, all revenues and expenditure of
MDAs are captured and balances (cash position) discernible from a central point. In terms of
coverage, all MDAs whether fully or partially funded by government; extra budgetary funds,

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donor funds and trust funds are required to be in the TSA net. By this arrangement, public sector
funds will be fully maintained with the Central Bank of Nigeria.
In order to provide a detailed modus operandi of the policy, the AGF issued Operational
Guidelines vide a Treasury Circular “Guidelines on the Implementation of Treasury Single
Account (TSA)/e-Collection” dated 23rd October 2015 that broadly categorized MDAs into
eight (8) for operational reasons as in Table III below.
Table III: MDA Categorization and Implementation Strategy
S/N MDA Category Examples Implementation Strategy
1 MDAs fully funded
through the
National Budget
All Ministries,
relevant
Departments and
Agencies
All receipts to go to the
CRF/TSA and expenditure drawn from
same based on Annual budget.
2 MDAs not funded
through the
National Budget but
generate
Additional revenues
Teaching Hospitals,
Medical
Centers, Federal
Universities,
Polytechnics,
Colleges of
Education, etc
All Collections from these Agencies
to be paid directly into the
CRF/TSA, except for extra
budgetary receipts which are to be
paid into Sub-Accounts at CBN,
which are linked to TSA
ii. Platform is configured to allow
access to funds based on
approved
budget
3 MDAs not funded
through the Federal
Budget but expected
to pay operating
surplus of 25% of
Gross Earnings to the
CBN, SEC, CAC,
NPA, NCC,
FAAN, NCAA,
NIMASA, NDIC,
NSC etc.
i. All Collection from these Agencies
to be paid into Sub‐Accounts at
CBN, which are linked to TSA
ii. Platform will be configured to
allow access to funds in the Sub
Account(s) based on approved

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CRF. budget
4 MDAs funded from the
Federation Account
NNPC, FIRS, NCS,
MMSD, DPR
i. All Federation revenues generated
by these Agencies to be paid
into the Federation Account at
CBN
ii. All Independent Revenue
generated by these Agencies to be
paid into CRF/TSA iii. FGN
Share of Federation Account to be
paid into CRF/TSA iv . Statutorily
approved cost of collection to be
deducted from Federation Account
and paid into Sub-Accounts at
CBN which are linked to TSA
v. Platform will be configured to
allow
access to funds in the Sub
Account(s) based on approved
budget
5 Agencies funded
through the Special
Accounts (Levies)
NSC, RMRDC,
PTDF, NITDA,
etc.
i. Sub-Accounts linked to TSA to
be maintained at CBN.
ii. All IGR collected to be paid
directly into the CRF/TSA
iii. Platform will be configured to
allow access to funds in the Sub
Account(s) based on approved
budget
6 Profit oriented Public
Corporations/Business
Enterprises
BOI, NEXIM,
BOA, Transcorp
Hilton, etc.
i. Sub-Accounts linked to TSA to
be maintained at CBN.
ii. Platform will be configured to
allow access to funds in the Sub

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Accounts(s)
based on approved budget
iii. Dividends from these agencies to
be paid into the CRF/TSA
7 Revenue Generated
under Public Private
Partnership.
All Incomes from
PPP arrangement
e.g. Production
of International
Passports, Seaport,
Concession
Arrangement etc
i. TSA Sub-Accounts to be
maintained at CBN ii. FG portion
of the collection to be paid into
CRF/TSA.
iii. Partners portion of the revenue
to be transferred to the partners
Account
8 MDAs with
Revolving Funds
and Project
Accounts Drug
Revolving Funds,
(Teaching
Hospitals,
Universities)
Fertilizer
Revolving Fund,
Roll‐Back Malaria,
SURE--‐P, etc.
i. Project Account (Revolving Funds)
to maintained at CBN
ii. Collection (IGR) from these
Agencies to be paid to CRF/TSA
iii. Platform will be configured to
allow access to funds in the Sub
Account(s)
Source: Guidelines on the Implementation of TSA/e-Collection
WHY TSA?
Until the introduction of the TSA, the country faces numerous challenges with management of
Public Finances that affect government efficiency and effectiveness in service delivery,
transparency and accountability. Some of these challenges were:
i. Loss of control on the number of bank accounts. MDAs are required under FR 701 to get the
approval of the Accountant-General of the Federation (AGF) for all their banking relationship. In
addition, each MDA is required by regulation to maintain four bank accounts, one each for
revenue, personnel costs, overhead costs and capital.

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However, many MDAs failed to comply, hence the number of bank accounts became over
bloated and monitoring the accounts became a herculean task for the OAGF. A survey of the
number of such accounts with both the Central Bank of Nigeria (CBN) and Deposit Money
Banks (DMBs) carried out by the OAGF in 2010 puts the number of accounts at over
10,000!With such a large number, government could not have timely consolidated information of
cash position necessary for efficient cash management in the country;
ii. Idle Cash in MDAs’ accounts while the CRF account is perpetually overdrawn. Prior to the
reforms, government financed its personnel and overhead costs monthly in advance while capital
projects were funded quarterly in advance but often the funds remained underutilized for the
periods. This leaves the Consolidated Revenue Fund (CRF) Account from which MDAs
Accounts were funded perpetually overdrawn as Ways and Means Advance granted by CBN in
line with S.38 (2) of their Act.
Accordingly, government incurs cost of borrowing on the overdrawn balance while the DMBs
that are keeping the MDAs’ idle funds do not remunerate them but buy government treasury bills
and bonds to earn interest income. A case of double jeopardy. The level of ways and means
granted by CBN to meet cash flow shortfalls has grown over the years reaching N342 billion in
2014.
iii. Maintenance of several extra budgetary funds. There exist a number of funds (dedicated
accounts) outside the Consolidated Revenue Fund (CRF) with huge balances while government
suffers charges on the CRF overdrawn balance with the CBN. If the extra budgetary funds were
linked to the CRF, it would have eliminated the ways and means charges, as the net position
would have been positive. Besides, the extra budgetary funds would have been an easy source
for short-term borrowing instead of treasury bills/certificates;
iv. Non-remittance of independent revenues by MDAs. A number of MDAs fail to remit their
revenues into the CRF in line with S.80 of the Constitution and spend the funds without
appropriation; etc.
Table II below shows the abysmal performance of independent revenues from 2010-2015.

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YEAR REVENUE GENERATION PERFORMANCE (%) VARIANCE (%)
ACTUAL (N bn) BUDGETED (N bn)
2010 73.15 305.97 23.91 76.09
2011 153.55 300.00 51.18 48.82
2012 190.71 228.93 83.3 16.70
2013 208.76 446.78 46.73 53.27
2014 249.44 455.78 54.73 45.27
2015 298.33 452.04 66.00 34.00
Source: OAGF Fiscal Report (2010 – 2015)
v. Growing domestic debt servicing burden. The insufficiency of funds to run government
services had made government to run budget deficit over the years with domestic borrowing
being a major component for its financing. For example, the sum of N624.22 billion was
borrowed to fund the 2014 budget thereby increasing the domestic debt stock. The implication of
high domestic debt is that huge financial resources that would have been used to deliver goods
and services had to be used for debt servicing annually. In 2014 for instance, the sum of N880.39
billion was spent on debt servicing or 18.75% of the total budget while Capital expenditure was
merely N490.48 billion or 10.45% of the total budget.
TSA AS A TOOL FOR MANAGEMENT OF PUBLIC FINANCES
A great challenge facing most parts of the world and, particularly, the developing countries like
Nigeria is how to achieve efficient allocation of resources as well as stabilization of the business
cycles. An important factor for efficient management and control of government’s cash resources
is a unified structure of government banking. Such unified banking arrangements should be
designed to minimize the cost of government borrowing and maximize the opportunity cost of
cash resources. This requires cash received is available for carrying out government’s
expenditure programmes and making payments in a timely manner.
Nigeria’s Finance minister reveals that the Treasury Single Account has helped tremendously in
managing public finances within four (4) month of its implementation. The minister who made
the disclosure while fielding questions from National Assembly Joint Committee on

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Appropriations alongside Nigeria’s minister of Budget and Planning Udo Udoma, she said the
account had accumulated to N2.9trillion, from its initial N2.2trillion in February.
According to the Accountant General of the Federation (AGF), Mr. Jonah Otunla, the new
Electronic Revenue Collection (ERC) platform is aimed at improving internally generated
revenue in the face of declining oil prices. This, he said, was in line with a series of treasury
reforms, which began in 2012, aimed at ensuring transparency and accountability in the
management of the nation’s finances. Director, Funds, Office of the Accountant General of the
Federation, Mr. Mohammed Dikwa, who spoke on his behalf, posited that henceforth,
government revenues would now be paid into the CRF/TSA, as it is now difficult for MDAs to
maintain revenues with commercial banks.
Onyekpere (2015) opined that the advantages and benefits of the TSA are legion. The
consolidation into a TSA paves way for the timely capture and payment of all due revenues into
government coffers without the intermediation of multiple banking arrangements. This prevents
revenue leakages in terms of revenue loss and mismanagement by operators of all revenue-
generating agencies. With this comes better cash management practices since the Treasury can at
all times have an overall view of government’s cash position, as against the fragmented positions
of different Ministries, Department and Agencies (MDAs), which need to be laboriously pooled
together to get the overall picture.
However, it has been discovered that, some revenue generating MDAs that generated N3.06
trillion in 2009, but only remitted N46.80 billion to government coffers; generated N3.07 trillion
in 2010 but remitted mere N54.10 billion; and generated N3.17 trillion in 2011 and just remitted
a meager N73.80 billion.
As in the case of Nigerian Communications Commission (NCC), which had two different
audited accounts — one with lower figures sent to the Fiscal Responsibility Commission (FRC)
and another with higher figures sent to the Office of the Auditor General of the Federation
(OAGF). During close examination of the Federal Inland Revenue Services (FIRS) presentation
showing how in its 2009 audited accounts, N5.6 million was found in the audited account

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forwarded to FRC while N323 million was found in the same audited account it sent to the
Office of the Auditor General of the Federation.
Advocates of this policy say it will encourage integrity in the management of public funds by
government and her agencies. The immediate past Accountant-General of the Federation, Jonah
Otunla, also backed the implementation of TSA stressing that it would bring about transparency,
efficiently and accountability. This is because TSA is bound to improve transparency and
accountability in public finance management. First, it will remove that organizational/MDA
secrecy around the management of public finances. The discretionary aspect of accounting
officers and politicians collaborating to do all manner of business with government finances
before executing projects thereby causing delays or negotiating interest rates with banks for
private gains will be over. The second is that revenue generating agencies that have been
depriving the Treasury of due revenue through a plethora of bank accounts under their purview
and which is not known to the authorities will no longer be able to defraud the revenue since all
funds will be swept into the TSA. Thus, beyond transparency and accountability, the TSA will
introduce economy and efficiency into overall management of public finances and this will in the
long run lead to effectiveness of government spending since it places government in a better
position to realize overall policy goals.
The Minister of Finance, Mrs Kemi Adeosun, lists the gains of the Treasury Single Account
(TSA) during a TSA workshop for states Accountants-General in Abuja. Excerpts from her
address:
The global economic challenges which are affecting our nation demand optimum efficiency in
the management of public funds. The objective requires an overhaul of the financial management
approaches adopted to meet financial obligations on time and ensure that cost effective financial
support is provided to public institutions. She added that, TSA is an essential reform for any
government wishing to pursue fiscal sustainability and prudent management of its resources. It
increases accountability and transparency, improves the processing of payments and collections
and reduces borrowing costs.

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TSA IMPLEMENTATION IN NIGERIA
The full implementation of the TSA will definitely have a positive effect on the economic
planning of the Federal Government, swift & full budgetary implementation, reduce leakages
and other irregularities in the MDAs, aid appropriate planning & data collection and data
analysis & timely aggregation of Federal Government Revenue etc, despite these avalanche
benefits its implementation has certain implication on the economy as it will pose a serious cash
crunch and liquidity challenges to the banking sector, who prior to the introduction of the TSA
feed fat on the float created by the duplicated and unaccounted MDAs accounts scattered in all
the Deposit Money Banks (DMBs) in Nigeria. Perhaps this will compel the banks to focus on the
funding of the real sector of the economy, rather than financing heavy Federal Government
projects, Oil & Gas transactions, Forex dealings etc. Any DMBs that fails to adapt swiftly and
look inwards to face the core banking functions which they were license, will definitely no
longer be profitable, which will leads to heavy downsizing of staff and thereby increasing the
unemployment rate in the country.
Some economic analysts are of the opinion that, the liquidity in the banking system will
definitely be affected. This is because once the banks collect government’s funds, it will be sent
directly to the TSA. The free funds some banks used to enjoy will no longer be there,
But on the other hand, some argued the opposite as follows: that they did not the full
implementation of the TSA hurting banks, properly so-called. It will only hurt establishments
that purport and pretend to be banks but have failed, refused and neglected to understand banking
and do what bankers do elsewhere. It is an opportunity for banks to refocus on the original
purposes for which they were set up – to collect depositors’ funds (not necessarily government
funds), keep them safe; engage in intermediation to create wealth and jobs for the economy and
in the process earn profit for themselves. Yes, the idea of sitting idly and expecting rents and
unearned income should be gone and gone for good. Good and well-managed banks will have no
problem with this measure.
CONCLUSION

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From the foregoing, it is obvious that the primary objective of a TSA is to ensure effective
aggregate control over government cash balances. It avoids borrowing and paying additional
interest charges to finance the expenditures of some agencies while other agencies keep idle
balances in their bank accounts. There were situations where some MDA’s manage their finances
like independent empire and remit limited revenue to government treasuries. Under a properly
run TSA, this is not possible as agencies of government are meant to spend in line with duly
approved budget provisions. The maintenance of a single account for government will enable the
Ministry of Finance monitor fund flow as no agency of government is allowed to maintain any
operational bank account outside the oversight of the ministry of finance.
The full implementation of this programme therefore is a critical step towards eradicating
corruption and other financial irregularities ravaging the country.
RECOMMENDATIONS
There is the need to improve the revenue base of the country through full implementation of TSA
so as to blocking of all leakages and improve the efficiency of revenue administration. The
revenue base of the Country is still low and its administration still leaves room for improvement.
This clearly indicates that the underlying assumptions underpinning the 2016 budget may only
be realised with serious efforts put in place towards revenue efficiencies and expenditure
discipline such as implementation of the TSA and Cash Management concepts by all tiers of
government.
The Deposit Money Banks (DMBs) as business entities should look out for opportunities in the
policy that will increase their profitability rather than crying over spilt milk. Some of the
opportunities include, serving as Agent for Taxes and Revenue collection, developing innovative
products to attract depositors; Reaching out to the unbanked segment of the society residing
mostly in the rural areas etc. CBN should pursue more robust monetary policy that ensures the
stability of the financial system. The recent injection of N740bn into the commercial banks and
slashing of Cash Reserve Ratio (CRR) from 31% to 25% are meant to ease liquidity.
Furthermore, total commitment and sincerity of purpose are required of those who are to
implement this policy. The agencies of government that are affected by the measure are thus

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enjoined to ensure that it succeeds. They must subsume their personal interests under the greater
need of the country. Altogether, what Nigeria requires at this time is the political will to push this
reform measure through. I suggest that all stakeholders play the roles expected of them to ensure
a successful implementation of the new policy.
REFERENCES
Chukwu, J. August 16, 2015: Treasury ingle Account: Giving Life to Jonathan’s Dead policy
Directives.Guardian Newspapers. Retrieved from:
http://www.ngrguardiannews.com/2015/08/treasurysingleaccount-giving-life-to-
jonathan’sdead-policy-directives/
Ekpung, E. (2001). The Essentials of Public Finance and Public Financial Management in
Nigeria. Calabar: University of Calabar Press
Enweagbara, O. August 16, 2015: Implementing the Treasury Single Account. Punch
Newspapers. Retrieved from http://www.punchng.com/opinion/implementing-the-
treasury-single-account/
Federal Treasury Circular, Ref no. TRY A9 & B9/2015: Guidelines on the Implementation of
Treasury Single Account (TSA)/e-Collection.
Federal Treasury Circular, Ref no. TRY A6 & B6/2004: Guidelines for Processing the
Central Capital Account (CCA) in the CBN.
Federal Treasury Circular, Ref No. TRY A8 & B8/2008: Circular for the Implementation of
e-Payment form for all Funds of the Federal Government of Nigeria.
Femi A. (Feb. 20, 2016) How TSA is curbing corruption Vanguard Newspaper retrieved from:
http://www.vanguardngr.com/2016/02/how-tsa-is-curbing-corruption-adeosun-finance-
minister/how-tsa-is-curbing-corruption-adeosun-finance-minister/
Iroegbu,C (2015),”Treasury Single Account ‘ll block leakages’, Vanguard, August 24, P38
Mathias Okwe, Abuja. Chijioke Nelson, Temiloluwa Adeoye, David Ogah(2015), Treasury
Single Account: Giving Life to Jonathan’s ‘Dead’ Policy Directives’, Sunday Guardian,
August 16, p52-58
Odekunle, F. (2015). Tackling Corruption in Nigeria: Strategic and Operational Options for the
Buhari Administration. Being a paper delivered at the 5th Convocation Lecture of Al-
Hikmah University, Ilorin on Saturday, 12th September, 2015.

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Office of the Head of Service of the Federation Circular, HCSF/428/S.1/120, 7th August 2015.
Re: Introduction of Treasury Single Account (TSA) (e-Collection of Government
Receipts),