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FRC board moves to right Obazee wrongs

By on May 22, 2015

After series of revelations which cast a pall on the corporate governance structure of the Financial Reporting Council of Nigeria (FRC), the board members rose from a meeting this week, deciding to right some of the anomalies caused by Jim Obazee, the council’s executive secretary.

A member of the board, who described last Monday’s meeting as ‘turbulent,’ insisted they are now striving to save the image of FRC, having also confirmed that they were ‘hard’ on Obazee.

As part of face-saving measures by the FRC, BusinessDay exclusively gathered that the board members have constituted two committees. The first committee is the Staff Promotion Committee, while the second is the Policy Committee.

It was further learnt that the Promotion Committee is mandated to implement a‘long over-due promotion exercise’ of the majority of FRC staff, in line with the new salary structure. Recall that there was a two grade-level demotion of all the staff of FRC contrary to Civil Service rules.

“The question is how realistic will the constituted Promotion Committee function because the staff conversion exercise was already wrong?” a source privy to the decision asked.

The board meeting may be the last for all FRC board members before the incoming government of Muhamadu Buhari dissolves it, alongside other board members of Federal Government agencies.

Maryam Ibrahim, chairman, FRC, at a press briefing this week, denied that there were internal squabbles among the board members.

Ibrahim told journalists (not BusinessDay) that: “I think what happened was that there were some arrears that needed to be paid to some categories of staff, but you know, this is a young board and eventually they were paid. Some members of staff also needed to be promoted, but it has to follow due process.”

At the briefing, Ibrahim also refuted the allegation of financial impropriety leveled against the FRC management, saying that the board members had seen all the council’s bank documents and did not discover any missing funds.

However, she forgot that there were questions raised by a board member on why the 2014 accounts of FRC were audited late, explaining that as a regulator, it was inconceivable that the FRC was operating outside the ambits of the law that established it.

It is particularly stated in section 38(2) that the accounts of the Council shall be audited not later than 60 days after the end of each financial year by external auditors appointed by the board.

Before now, some board members had expressed dissatisfaction over the internal corporate governance style of the FRC leadership.

In a letter which the chairman herself was privy to, a board member had questioned why the council’s account with Union Bank was overdrawn by about N40million. Among others, receivables of about N21.08 million, were questioned and the tenor of the advances and recipients were requested –an issue Ibrahim did not clarify.

Also, there were questions on FRC bank charges valued at N636,440 which a board member say “does not tally with the information given at the last audit meeting, where it was stated that it was due to high cash withdrawal charges from banks. Why should the council be involved in large cash payments against the CBN guidelines on cash less society?” the board member asked.

The Financial Reporting Council of Nigeria cancelled the public hearing on the draft National Code of Corporate Governance scheduled to hold last Tuesday following a court injunction.


[Business Day]