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Listed companies fail to meet result submission deadline

By BusinessNews Staff on May 8, 2014

Several companies listed on the Nigerian Stock Exchange are failing to meet the bourse’s deadline for filing their financials, it has been gathered.

Earlier this year, The PUNCH had reported that in the first three quarters of 2013, not up to 60 per cent of quoted companies submitted their results on time. This is despite the fact that companies, which fail to submit their financials on time, risk sanctions.

For instance, between January and October last year, the NSE fined 21 companies a total of N28.6m for late submission of their accounts.

Data obtained from the NSE on the financials released by companies as of May 2, showed that the situation had not changed.

For instance, only 55 companies had filed their financials for the first quarter of 2014 as of that date. This is less than 40 per cent of the over 170 companies listed on the main board of the Exchange.

In the first quarter of 2013, 56.91 per cent of the companies filed their results on time.

When contacted, the Head, Corporate Communications, NSE, Nwando Ajene, said up to 57 per cent of the companies had filed their results, with insurance firms forming a large percentage of those yet to submit their results.

Ajene, who said more results had been submitted, explained that companies that failed to meet the deadline would face sanctions.

“From today, the penalty started counting. So, based on when they submit the results, their fines will be calculated; they have been sent reminders as well,” she said.

The President, Renaissance Shareholders Association of Nigeria, Mr. Olufemi Timothy, called on the Exchange to go tougher on the companies.

According to him, it is important for the NSE to look beyond fines to sanctions that will affect officials of errant companies such as the compliance officer or the managing director.

Timothy said, “Imposing fines alone is not enough to deter companies from failing to meet their listing obligations. We have always agitated that the NSE should even punish officials rather than just imposing fines.

“If you continue to impose fines, they will continue to commit the same offence, but if you punish officials (of the affected companies) by way of suspension from office or deducting some of their entitlements, that will serve as a better deterrent. So, we need more regulation that will affect the officials.”

Insurance companies have had challenges complying with the International Financial Reporting Standards adopted by Nigeria on January 1, 2012.

In January this year, the Chief Executive Officer, NSE, Mr. Oscar Onyema, said the Exchange was aware of the challenges and was working with the National Insurance Commission as well as the companies to resolve the issue.

However, the President, Constance Shareholders Association of Nigeria, Mr. Shehu Mikhail, said listed companies had no reason not to meet the deadline, considering the time that had elapsed since the adoption of the IFRS.

He said, “One thing is for sure, the move by the NSE to compel companies to submit accounts within a particular period and using international standards is good for the integrity of the Exchange as it will make companies accountable.

“So, I don’t see any reason why companies have not been able to comply with the directives of the NSE. The NSE should stand by its directives and get directors and audit committees of the companies to understand and comply with them.”

[Punch]

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