Opinion
Reflecting on FRC Transparency by Entities
BY ABUBAKAR YUSUF.
The Financial Reporting Council FRC under the Renewed Hope Agenda of President Bola Ahmed Tinubu has frowned against the non transparent, accountable practices of the existing companies in Nigeria, hence creating suspicion among companies operating within the country and the foreign ones .
Aside all this non corporate conducts , government was simultaneously been denied the statutory revenues on the operations of the both local and foreign companies or partners, as well as paint a gloomy image of the country before the international communities.
The new leadership under the Executive Secretary, Financial Reporting Council FRC under Dr Rabiu Onaolapo Olowo has perfected plans to address without further delay by putting in place necessary machinery to address the lingering and unethical conducts that had dented the image of the country.
This was been done through advocacies, seminars , symposiums, talkshops and workshops as well as awareness program through paper presentation at seminars to nip in the bud or reduce to the barest minimum of the unbecoming act that had painted the country negatively before the international communities.
Coming at a time when the country’s is seeking for wholistic reforms of its revenue based through payments of appropriate taxes and revenues, with the current ways of operation , if not reversed and reconfigured, will end up not doing the country any good .
These negative development has affected the investors confidence and output due to falsified accounts by companies either through under declaring their profits or over declaring them through falsification.
According to the Executive Secretary ..
“Nigerian investors have lost billions of dollars due to companies falsifying and deliberately overstating their accounts, according to Rabiu Olowo, executive secretary/CEO of the Financial Reporting Council of Nigeria (FRCN).”
“He disclosed this while delivering a paper titled “Proactive Regulation: A Catalyst for Preventing Audit Failure” at the 2024 audit summit – stakeholders’ engagement in Lagos.”
“Olowo emphasised that these fraudulent practices have led to the downfall of numerous companies and caused severe financial damage to investors.”
” Olowo highlighted the need for stronger oversight and accountability in the financial reporting and auditing sectors. He pointed out that similar scandals have occurred globally, referencing notable financial collapses such as Enron, Lehman Brothers, and more recently, Wirecard and FTX. These incidents, he said, underscore the devastating consequences of corporate greed and audit failures.”
“Nigeria has not been immune to such audit failures. Between 1990 and 1994, the country’s banking sector alone lost over N6 billion ($42.9 million) due to fraud. Cases like the collapse of Afribank Plc in 2011 and the Cadbury Nigeria scandal between 2002 and 2005 revealed significant shortcomings in the auditing process, with auditors accused of facilitating the falsification of accounts. These failures not only resulted in substantial financial losses but also eroded investor confidence in the Nigerian capital market.”
“The consequences of these audit failures extend beyond financial losses. They have led to a loss of confidence in the capital market, a credit crunch, capital flight, and a significant drop in market capitalisation. For instance, the market capitalization of the Nigerian Stock Exchange fell from N13.5 trillion to N4.6 trillion in 2009. Additionally, pension funds lost about N2 billion in 2009, and investors became wary of the reliability of corporate financial statements.”
“Adding to this, Olowo emphasised that accounting and auditing are professions built on confidence, requiring the courage to uphold what is right, even when unpopular. This integrity is crucial to maintaining society’s trust in audits and auditors. He noted that audit reform must address not only the technical failings but also the human elements that contribute to audit failures. According to Olowo, it’s essential to distinguish between the failings of governance and management and those of audit practices. He stressed that laws alone cannot drive compliance; instead, creating a conducive social context is necessary to encourage ethical behavior and adherence to rules.”
“Olowo referenced legal scholars who argue that while laws promote prosocial behavior, their effectiveness depends on the social conditions surrounding them. He reminded stakeholders that genuine reform must focus on people as well as rules, as “only people, not rules, can make good things happen.” To this end, Olowo urged those present, both in person and online, to deliberate on strategies to prevent future audit failures in Nigeria, reiterating the adage that prevention is better than cure.”
“In response to these challenges, Olowo, who assumed office on October 16, 2023, has launched a transformational agenda for the FRCN. The agenda, termed “DOSE” (Digitalization, Operational excellence, Stakeholder Engagement, and Enforcement), aims to revitalise the Council and ensure adherence to best practices in financial reporting, auditing, and corporate governance in Nigeria. The FRCN plans to enhance compliance with the FRC Act 2011 and restore investor confidence by ensuring that financial statements from Nigeria are credible and reliable.”
“Olowo’s vision is to position the FRCN as a leading financial reporting regulator in Africa, capable of standing alongside its global peers. By holding corporations and individuals accountable, the FRCN aims to restore trust in Nigeria’s corporate reports and governance, aligning with President Bola Tinubu’s renewed hope for the nation’s economy.”
In line with amendment of its act , reforms and ongoing repositioning of its regulations in line with the government position on the new tax reform, no doubt the previous order will become a thing of the past .
Governments at all levels is geared towards mobilisation of adequate funds to mitigate the economic, social and Infrastructural development of the country yearning for more attention.
The moves when executed will reform the system, restore image loss of the country and sanitize the operation of both local and international companies operating in the country.
Written BY ABUBAKAR YUSUF on yus.abubakar3@gmail.com.
Heineken Lokpobiri, minister of state for petroleum resources, says the federal government plans to commence implementing the drill-or-drop provisions of the Petroleum Industry Act (PIA).
Section 94 of the PIA gives operators a period of three years to begin oil production or relinquish the assets to the federal government.
Speaking during the Cross Industry Group (CIG) meeting held on Tuesday in Florence, Italy, Lokpobiri said it is in the best interest of the country that all inactive wells go to work.
He said the federal government, under the leadership of President Bola Tinubu, has provided every necessary incentive to ensure international oil companies (IOCs) in Nigeria run smoothly and profitably.
“Now, it is imperative for these industry players to match the government’s efforts with increased investment by announcing final investment decisions (FIDs),” he said.
Furthermore, Lokpobiri discussed “the challenges, expectations, and measures to enhance the sector’s contributions towards domestic energy needs and regional expansion across Sub-Saharan Africa”.
He emphasised that while IOCs have highlighted engineering, procurement, and construction (EPC) contractors as a challenge, “EPCs will not come unless they see strong commitments from industry players”.
“The government has done its part to provide the requisite and investment-friendly fiscals, the ball is now in the court of the IOCs and other operators to make strategic investment decisions that will drive increased production and sustainability in the sector,” he said.
“We must also recognise that domestic crude supply is essential to national energy security. The best solution to this challenge lies in increasing production, which will ensure a balance between domestic supply obligations and external commitments.”
The minister further urged industry players to explore collaborative measures, such as shared resources for contiguous assets and the release of underutilised assets to operators ready to invest in production.
The Progressive Students Movement (PSM), a leading Pan-African student body, has commended the leadership of the Nigeria Police Force (NPF) in Ogun State under Commissioner of Police (CP) Lanre Ogunlowo, PhD, for its commitment to security and community engagement.
In a statement released on Thursday, the President of PSM Nigeria, Comrade Ambassador Okereafor Bestman, highlighted the CP’s efforts in strengthening collaboration between the police, stakeholders, and other security agencies to maintain peace and stability in the state.
“It is worthy of note that CP Lanre Ogunlowo, PhD, has further fostered a harmonious working synergy between the police, stakeholders, and other security agents aimed at ensuring peace and tranquility in Ogun State,” Okereafor said.
The student leader expressed confidence in CP Ogunlowo’s leadership, stating that Ogun State is on track to becoming one of the most peaceful states in Nigeria under his administration.
He also praised the professionalism and dedication of the Ogun State Police Command in tackling crime, regardless of its scale.
Additionally, PSM acknowledged the Ogun State government’s continued support for security agencies, particularly in providing mobility and logistics to enhance their operational efficiency.
The commendation comes at a time when security remains a top priority for residents and authorities in the state, with ongoing efforts to curb crime and ensure public safety.
BY ABUBAKAR YUSUF
On assumption of duty in January, 2025 , the new Universal Basic Education Commission, UBEC, Boss and well grounded World Bank expert , Aisha Garba envisaged the need to reposition the Basic Education through interfacing with the critical stakeholders.
Amongst them is the office of the National Security Adviser , NSA, led by Malam Nuhu Ribadu whose achievements in the last few years in the area of security has become distinct and outstanding.
Therefore, seeking to cooperate and collaborate with the office became germane and needful particularly the protection of lives and properties of actors in the promotion of Basic Education ranging from the pupils , teachers , workers and facilitators to enable it drive the new wave to curb Out of School Children OOSC in the country.
Aside providing the basic security arrangements for schools , the need to engage the security apparatus at the level of National Security Adviser NSA became needful, so as to address the sophistry of security problems in the country, to nip in the bud any unforseen circumstances.
With the high rates of kidnappings, abduction , banditry, cattle rustling, ritual tendencies among many other vices, the idea of bringing on board , the security architecture of the country in all ramifications will assist the commission to consolidate the implementation of Basic Education policies and programs, also introduce new ones .
Since pupils at the Primary, Junior Secondary and Secondary Schools are prone to such ugly development and security issues , the need to be proactive on the part of the commission became timely and desiring.
This led to the success story of the bilateral interface between the management of the commission and NSA, to streamline, perfect and chart a new course on the issue of security of actors in the Basic Education.
The visit described as timely and long overdue, discussed fruitfully the way forward and the immediate and long term intervention of both agencies in the area of collaboration.
According to the Executive Secretary, Universal Basic Education Commission UBEC, Dr Aisha Garba she stated by discussing” strategic initiatives aimed at enhancing educational access and security in Nigeria. ”
She further said” the engagement focused on strategies to address challenges such as the safety of schools, particularly in vulnerable regions, and the promotion of equitable education for all children.”
“the meeting highlighted the critical intersection between education and national security and the need for collaboration between UBEC and Office of the National Security Adviser (ONSA), on improving access to basic education and safety of safety schools across the nation. ”
“This collaboration underscores the government’s commitment to fostering a secure and inclusive learning environment as part of its broader agenda to strengthen the nation’s educational framework,” it added.
“UBEC boss had pledged to engage critical stakeholders to break down barriers to education and create inclusive learning opportunities for children across the six geopolitical regions of the country.”
“She said: “My goal is to deliver on this mandate which includes strengthening collaboration, partnerships and institutional learning for effective service delivery. ”
“Together, we will work to increase access, improve quality, provide conducive and safe learning environments, supply adequate teaching and learning materials, and adopt the concept of ‘best fit’ in addressing specific basic education challenges, state by state and region by region”.
Highlights of the program which included the engagement of both bodies with a commitment to ensure the introduction of security architecture in schools in Nigeria is achievable.
Written BY ABUBAKAR YUSUF on yus.abubakar3@gmail.com.