By Niyi OLAOYE
The Federal Government has directed the Financial Reporting Council of Nigeria (FRC) to investigate bank on Aviation Intervention funds given to banks.
The directive which was convened by Senate Committee on Trade and Investment Chaired by Mrs. Fatima Raji Rasaki, to FRC management during a courtesy visit to the Council’s office in Lagos, mandated all Deposit Money Banks (DMBs) and the Bank of Industry (BOI) to present proper accounts of the funds which were given them.
Rasaki explained that there was a need for further investigations into the circumstances surrounding the aviation intervention funds given to some banks, adding that explanation given so far on the application of the funds was not satisfactory and therefore the need for the Council to re- investigate the matter with a view to getting a detailed accounts of what was given and received and how the funds were applied.
Although, she commended the FRC for the good work it has been doing despite the limited resources available to it and urged the Council to do more in ensuring that a credible financial and accounting reporting that meets international best practices is entrenched in our country.
She also called for increased funding for the FRC given the crucial role it plays in ensuring that accounting and Financial reporting standards are observed by both Private and Public entities, noting that there is the need for close collaboration between the Ministry of Finance and the FRC to ensure that the Council is not starved of funds.
She said, “You are like the police and as such you need to be adequately funded so that you will not compromise.”
While responding, the Executive Secretary of the FRC, Mr. Jim Obazee thanked the Committee for the visit and pledged that the Council would not relent in carrying out its function of ensuring accuracy and reliability of financial reporting and corporate disclosures, adding that the Council must always ensure that both Public and Private sector businesses observe minimum acceptable standards of transparency and accountability in doing business in line with global best practices.
Obazee admitted that the BOI statutorily submits its accounts to FRC, which passes its observations to the supervising ministry for action.
He also disclosed that the account of Central Bank of Nigeria is submitted to FRC, stating that reports on the apex bank accounts are passed to the Presidency for action.
Briefing the committee members on activities of the FRC, he said the National Code of Corporate Governance being developed by the Council is almost ready for operation, noting that the last and final of series of public hearings on the code was held last week.
He expressed optimism that the new code would be operational by the third quarter of this year, while observing that legal challenges by some stakeholders on the need to collaborate with other regulatory agencies have delayed its enactment.
He highlighted some of the problems the new national code would address to include insiders dominated boards, non-independent corporate boards of companies, absence of minority voices on boards, inadequate board monitoring and supervision of the executive, ineffective audit function and committees.
He said the coming on board of the code would result in restoration of investors’ confidence in the economy.
Obazee identified some of the challenges of the FRC to include lack of office accommodation in Lagos and Abuja, lack of takeoff grants since the establishment of the council
Comments are closed.