Wednesday 01 September 2010
- Culled from The PunchAs part of efforts
to strengthen the capital market structure, the Securities and Exchange
Commission, has inaugurated an inter-agency committee to work out the
modalities for the implementation of an effective control system for public
companies. This is being done
according to Section 63 of the Investments and Securities Act No.29 of 2007.A statement from
the SEC on Tuesday, said, “The Act states that â€an auditor of a public company
shall, in his audit report to the company, issue a statement as to the
existence, adequacy and effectiveness or otherwise of the internal control
system of the public company.â€Inaugurating the
committee in Lagos on Friday, the SEC‘s Executive Commissioner, Operations, Ms
Daisy Ekineh, told members of the committee that the internal control system of
a public company was designed to provide reasonable assurance regarding the
achievement of organisational objectives. Ekineh added that
it was also to ensure the efficiency and effectiveness, as well as the
reliability of financial reporting and its compliance with applicable laws and
regulations.She, therefore,
told the committee, whose membership was drawn from across regulators and
operators in the financial sector that its responsibility was very important in
the ongoing reforms in the financial sector. According to her, a functional
internal control system will come into effect its the successful completion of
their task.Ekineh said a
functional internal control system would also ensure that Nigerian quoted
companies were internationally competitive in terms of the attraction of
foreign direct investment.Ekineh who was
represented at the event by the Secretary to the board of SEC, Mr. Kennedy
Aigbekan, outlined the terms of reference of the committee. According to her,
they include the review of the existing scope of audit engagement in view of
the fact that the inclusion of Section 63 of the ISA 2007 should be treated as
part of the audit review (as required by law) and recommendation of a date for
commencement of implementation as also prescribed by the ISA.In an acceptance
speech on behalf of members, the committee chairman, Mr. Jim Obazee, said that
the members did not only consider the appointment to the committee as a call to
duty, but a challenge to discharge a very important responsibility. According to him,
this has a fundamental role to play in promoting business enterprise, foster
socio-economic development, enhancing public-private partnership and the
general well-being of the entire citizenry of Nigeria.Obazee who is also
the acting Director-General of the Nigerian Accounting Standards Board,
commended SEC for adopting the approach of involving other agencies in
fashioning out a roadmap for the implementation of this section of ISA. He said, â€I wish to
submit that the roadmap approach SEC is adopting today may create an
opportunity for our nation to rethink the regulatory regime across all
dimensions, because securing the buy-in of the organisations and institutions
that are affected by regulatory pronouncements and legislation usually allow
relevant entities to respond to legislation with better understandingâ€.Other regulatory
bodies represented in the committee include the Central Bank of Nigeria; the
Securities and Exchange Commission; the Nigerian Accounting Standards Board;
the Corporate Affairs Commission; the National Insurance Commission, and the
Nigerian stock Exchange. Also, the committee
has representatives from the two professional accounting bodies namely, the
Institute of Chartered Accountants of Nigeria, and the Association of National
Accountants of Nigeria, as well as the industries, represented by GT Bank and
Unilever Plc.