The Federal Government has directed Ministries, Departments and Agencies (MDAs) not to award contracts or enter into any financial commitments without first obtaining the required budgetary approval and cash backing.

The directive, contained in a Federal Treasury Circular dated July 31, 2026, and made available to newsmen on Monday, was signed by the Accountant-General of the Federation, Dr. Shamseldeen Ogunjimi, and addressed to ministers, permanent secretaries, heads of extra-ministerial departments and agencies, accounting officers, and federal pay officers.

Under the guidelines, no expenditure is to be incurred without the authority of a Warrant or Authority to Incur Expenditure (AIE). The circular also prohibits MDAs from issuing letters of award, signing contracts or entering into any financial commitments unless the corresponding Warrant or AIE covering the contract value has been released by the Minister of Finance and Coordinating Minister of the Economy to the Accountant-General of the Federation.

“No expenditure shall be incurred except on the authority of a Warrant/AIE (including employee payables). Accordingly, no MDA shall issue letters of award, sign contracts, or enter into any financial obligations unless the corresponding Warrant/AIE covering the full or committed portion of the contract sum has been duly released by the Honourable Minister of Finance and Coordinating Minister of the Economy to the Accountant-General of the Federation,” it stated.

The circular further directed MDAs to attach copies of Warrants or AIEs generated through the Government Integrated Financial Management Information System (GIFMIS) as evidence of fund availability before contracts are awarded or payments processed. It also stated that financial commitments, including purchase invoices and employee payables, must not exceed available warrant balances.

In addition, the Bureau of Public Procurement (BPP) was also instructed to process only requests for “No Objection” certificates supported by valid Warrants or AIEs.

According to the circular, the operational guidelines were introduced to strengthen the implementation of the Federal Government’s revised cash management policy following observed violations of the Public Procurement Act, 2007, and other financial regulations.

“Further to the Treasury Circular… captioned ‘Revised Policy on Cash Management and Bottom-Up Cash Plan Operational Guidelines,’ it has become necessary to strengthen and deepen the implementation of the policy sequel to the observed non-compliance with the Public Procurement Act, 2007, and other extant laws and regulations,” the circular stated.

The circular also reminded accounting officers that awarding or signing contracts without budgetary provision, approval and cash backing constitutes an offence under the Independent Corrupt Practices and Other Related Offences Commission (ICPC) Act 2000.

“Accounting Officers are invited to note that it is an offence under the ICPC Act 2000 to award or sign any contract without budgetary provision, approval and cash backing,” it added.

The circular urged accounting officers, directors of finance, internal auditors and other relevant officials to ensure full compliance with the guidelines to strengthen fiscal discipline and improving budget implementation.