Financial Reporting Council Bill signed into law

Olusegun Aganga
Minister of Trade and Investment (Middle)

Financial Reporting Council Bill signed into law
Hauwa Noroh Ali, Abuja

The Financial Reporting Council (FRC) Bill aimed at guaranteeing credible financial reporting in the private and public sector of the Nigerian economy has been signed into law.

The Minister of Trade and Investment, Olusegun Aganga announced the signing of the Bill into law at the opening of a a workshop on “Attracting Investments into Nigeria” held in Abuja.

He stated that the Bill was as part of the government’s efforts aimed at building a credible financial system in Nigeria.

The FRC Bill was first passed by the former National Assembly in 2006 but was not accented to by President Olusegun Obasanjo. The failure of the successor, the late Umaru Yar’Adua, to sign the Bill three months after assuming office called for a fresh legislative process on the Bill.

“On assumption of office, as the minister of Trade and Investment, I discovered that  the President had began to demonstrate his avowed move to promote cross border listing, harmonization  of regulatory capacities and consolidation of economic reforms by signing the Financial Reporting Council Bill into law,” he said.

“You will recall that the Federal Executive Council, on July 28, 2010, unveiled the roadmap for Nigeria’s adoption of International Financial Reporting Standards effective from January 2012 in order to enhance our national dedication to reliable financial information and audit quality assurance.”

Increased foreign direct investments

He said that application of the provisions of the Financial Reporting Act will lead to an increase in foreign direct investment and easier access to external capital.

“More meaningful and decision enhancing information can now be arrived at from financial statements issued in Nigeria because accounting, actuarial, valuation and auditing standards, used in the preparation of these statements, shall be issued and regulated by this Financial Reporting Council.

“The FRC is a unified independent regulatory body for accounting, auditing, actuarial, valuation and corporate governance. As such, compliance monitoring in these areas will hence be addressed from the platform of professionalism and legislation,” he said.

The present administration, according to Mr Aganga, is determined to restructure and reform the economy of Nigeria, create necessary macroeconomic and regulatory environment as a way of attracting foreign direct investment and encourage ideas that can lead to realisation of the full potentials of national resources.

Standards' enforcement

According to the Nigerian Accounting Standards Board (NASB), the passage of the Financial Reporting Council Bill would help to address the current institutional weaknesses in the regulation, compliance and enforcement of standards, and the development of robust arrangements for monitoring and enforcing compliance with financial reporting standards.

Recently, at a forum in Lagos, the Executive secretary and chief executive of the NASB, Jim Obazee, said that Nigeria stood to receive increased Foreign Direct Investment (FDI) when the bill was passed.

“Nigeria will be included in the list of third country auditors, as unveiled by the European Union, and as such, our professional accountants shall be allowed to audit companies that have subsidiaries in the EU without limit,” he pointed out.

Job creation

The Minister of Trade and Investment, Dr. Olusegun Aganga, noted that the
Nigerian Government had offered to release 75 billion Naira to Small and Medium Scale
Enterprises (SME) across the country as a credit facility to strengthen their capacity for job creation.

He said that the money would be disbursed to SMEs through the Bank of Industry and the Nigerian Import Export Bank at a single digit interest rate.

Aganga said that the Government would give priority to the development of SMEs in the next four years by providing the necessary incentives for their businesses to thrive.

“One of the major areas of concern for the Federal Government is the growth and development of the Small and Medium Scale Enterprises. We have identified lack of access to credit as one of the major factors inhibiting the growth of SMEs in Nigeria. Very soon, the government will commence the disbursement of 500 Million dollars credit facility to SMEs through the Bank of Industry and the Nigerian Import Export Bank at a single digit interest rate,” he said

In his words: “The Nigerian government is determined to restructure and reform the economy by creating the necessary macro-economic and regulatory environment, as a way of attracting Foreign Direct Investments and encourage ideas that can lead to the realisation of the full potential of our national resources.

The workshop was attended by the minister of state for trade and investment
Dr Samuel Ortom, the minister of Mines and steel, Mr Mohommed  Sada , the minister of  Agriculture, Dr. Akinwunmi Adesina among others.

The workshop was moderated by McKinsey, a consulting firm, which had described Nigerian economy as one of the largest economies in the 21st century and had declared its interest in building the companies and institutions that are driving the economy.

Williams