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FRC garners support to review financial statement of government entities

By Anthony Otaru, Abuja
29 December 2021   |   2:47 am
Experts have expressed support for the Financial Reporting Council [FRC] to review financial statements of government entities contrary to criticisms in some quarters.

Financial Reporting Council

Experts have expressed support for the Financial Reporting Council [FRC] to review financial statements of government entities contrary to criticisms in some quarters.

They argued that apart from the fact that such exercise is in line with the FRC Act 6, 2011, reviewing financial statements of the entities will further strengthen profitability and value for money for the nation among other benefits.

The Financial Reporting Council of Nigeria [FRCN] is an agency in the Federal Ministry of Industry, Trade and Investment, established by Act 6 of 2011.

Recall that the Council, through the Executive Secretary, Ambassador Shuaibu Ahmed, recently disclosed in Abuja, that it has begun a review exercise of financial statements of selected agencies in line with its constitutional mandate.

Amed also assured that the council remains resolute despite the fact that some financial statements already seen were enmeshed in questionable financial wrongdoings.

In his contributions, a Senior Director in FRC, who does not want to be mentioned, told The Guardian that the ongoing review exercise of the entities by the council is aimed at promoting trade and investment by ensuring that transparency, accountability is strictly adhered to to by the agencies financial statements.

On the issue of double auditing, he argued that FRC’s mandate does not include auditing but a review of financial statements in line with best practices.

He assured that government entities that do not submit acceptable financial statements stand the risk of being sanctioned including prosecution.

Speaking to The Guardian on phone, the Lead Director, Centre For Social Justice [CSJ], Eze Onyekpere said that reviewing the financial statements of the NNPC, Banks, Pension Funds Administrators, among others, by the FRC is all about enthroning good corporate governance practices that guarantee accountability, transparency.

Onyekpere stressed, ‘’If you recall, there has been a challenge in getting operating surpluses from government agencies by the Fiscal Responsibility Commission [FRC] in line with the Act that makes it compulsory for agencies to refund their operating surpluses to the consolidated revenue accounts. This has been flouted severally by the government agencies and has not helped ineffective management of resources over time. You can see waste all over; this must not continue.”

He further argued that reviewing the statements of the mentioned agencies is in the right direction if the intention behind is to achieve good corporate governance.

He, however, noted that the exercise has nothing to do with double auditing, more so that the FRC does not have auditing powers. But to ensure that statements meet global best practices.

In his opinion, a retired Professor of Agric. Economics, University of Benin, Prof. Williams Modugu, urged the FRC to remain consistent in the discharge of its duties in line with its mandate.

According to him, the next step is to invite the entities for inspection meetings with their auditors to come and clear themselves on infractions noted in their statements and when found wanting, such entities are penalised including prosecution.