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SEC to sanction firms over non-rendition of returns

By Peter Egwuatu
THE Securities and Exchange Commission (SEC) announced that non rendition of returns by quoted companies will attract sanctions.

The Commission also re-emphasized its commitment to collaborate with all stakeholders in fostering the growth and development of the capital market.

While addressing Financial Controllers and Company Secretaries of public companies in Abuja last week, the Director-General of the Commission, Ms. Arunma Oteh said the Commission has organized the meeting with them to address the lingering issue of non-rendition, and late rendition of quarterly and half yearly returns of publicly quoted companies.
According to her, more than 50 per cent of quoted companies in Nigeria have not been complying with section 60 of the Investments and Securities Act (ISA) 2007 in terms of rendition of quarterly and half yearly returns which has attracted sanctions.

On the need for timely and adequate rendition of returns, the Director-General disclosed that such rendition would afford investors the opportunity to make rational investment decisions and enable the Commission ascertain the financial health of publicly quoted companies, ensure compliance with good corporate governance and adherence to other regulatory requirements.

In addition, she explained that the rendition of timely, accurate and reliable information to investors will assist in rebuilding the confidence in the market.

She opined that it was largely non compliance with governance issues that led to the collapse of big corporations such as Enron and Worldcom. “Back home, that recent crisis in the financial market could also be partly attributed to non-compliance with corporate governance.

Corporate Governance, according to her, is considered an important issue in the corporate and business World. “It impacts on corporate performance, shareholders value, public perception, ability to attract the best, employee morale, capital markets and indeed the economy”

She however acknowledged that the Commission has in recent times noted some improvement in the quality of the returns rendered by some public companies, but that the number of companies that have been rendering their returns is still below expectations.

Corroborating the Director-General of SEC, the Commission’s Director of Financial Standard and Corporate Governance (FS&CG), Mrs. Obhielo Abigail said Section 60 of the ISA requires all public companies to file with the commission on annual and periodic basis, its audited financial statements and such other returns as may be prescribed by the commission from time to time.

She stated that pursuant to the requirement of the Act, the Commission on March 10, 2009 issued a circular to all publicly quoted companies, on the modalities for filling the audited annual reports and account, half yearly returns on corporate governance and unclaimed dividends and quarterly financial reports.

She reiterated the information need of various stakeholders ranging from being able to assess the financial health of the public quoted companies by the regulator for effective allocation of resources by companies.

She added that efforts are on by the commission to ensure that the key drivers of the capital market, which are adequate, reliable and timely information is achieved.


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