By Nkiruka Nnorom

The Nigerian Stock Exchange (NSE) yesterday said henceforth, it will name and shame any quoted company that fails to submit its periodic financial statement on time.

Besides, it said that tougher financial penalties will also be imposed on such companies to ensure compliance while it will also come up with more comprehensive disclosure regime,  and rules for companies seeking extensions of report filing.

Quoted companies on the Exchange are required as part of the NSE’s post-listing rules requirement to submit their periodic financial statement to it. Timely submission enables the investors to make informed decision on any stock they intend to invest in.

Usually, the Exchange tags Below Listing Standard (BLS) beside the defaulting company on its X-Compliance sticker, while in some cases, such default attract cash fines to deter listed entities from violating the post-listing requirement with regards to financial disclosures.

However, in a draft rule posted on its website yesterday, titled, “Notification of Revised Draft Rules for Filing of Accounts and Treatment of Default Filing & Invitation for Comments”, the NSE said it decided to withdraw the Initial Draft Rules already submitted to the Securities and Exchange Commission (SEC) for approval following the discovery that disclosure requirements as well as the sanctions provided in the Initial Draft Rules were not stringent enough to deter violations.

According to the Exchange, the latest version, if approved by SEC, would instil greater diligence, prompt, detailed and more responsible disclosure with regard to financial reporting, while simultaneously achieving greater deterrence to Issuers against repeated late filing of their financial statements.

Part of the provisions of the new version of the revised rules include procedure for the treatment of default filing, steps to be followed by an Issuer that applies for extension of time to file its audited accounts; as well as steps to be taken where an Issuer defaults in filing its accounts.

Part of the statement reads: “Between 20 February and 6 March 2015, the Nigerian Stock Exchange exposed the “Rules for Filing of Accounts and Treatment of Default Filing” (Initial Draft Rules) for comments by stakeholders.”