Financial Reporting and Ethics - The Institute of Chartered ...

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FINANCIAL REPORTING AND ETHICS(c)(d)Audit committees should not act as a barrier between externalauditors and the executive directors or encourage the main boardto abdicate responsibilities in reviewing and approving thefinancial statements; andAudit committees should be made up of strong, independent andknowledgeable personalities from different backgrounds.Composition of an Audit Committee(a)An audit committee should be established in accordance withSection 330 (3) of the Companies and Allied Matters Act, Cap.C20, LFN 2004, with not more than one executive director;(b)(c)(d)(e)A majority of the non-executive members serving on thecommittee should be independent of the company in terms ofmanagement or business or other relationship, which couldmaterially interfere with the exercise of their independentjudgment as committee members;A non-executive director nominated by members of an auditcommittee should serve as the chairman;Membership of an audit committee should be for a fixed tenure;however, any member is eligible for re-election;The secretary of the audit committee should be the companysecretary, auditor or such other person nominated by thecommittee.Qualification and Experience of Members of an Audit Committee(a)Members of an audit committee should be able to read andunderstand basic financial statements and make valuablecontributions to the committee’s deliberation;(b)(c)An audit committee should review not only external auditor’sreport but also, most importantly, the report of the internalauditor;Members of the committee should possess the following qualities:(i)(ii)(iii)(iv)(v)Integrity;Dedication;Thorough understanding of the business, its products andservices;Reasonable knowledge of the risks facing the companyand the essential controls which it has in place;Ability to offer new or different perspective andconstructive suggestions; and232
CORPORATE GOVERNANCE(vi)Inquisitiveness and dependable judgment.Terms of Refereference ence for Audit Committee(a)In line with Section 359 (6) (a-e) of the Companies and AlliedMatters Act, Cap. C20, LFN 2004, the committee should be giventerms of reference;(b)(c)The performance of the committee and its members should beevaluated periodically, as could be decided by the company; andThe committee should maintain constructive dialogue betweenthe external auditors and the board; enhance the credibility ofthe financial disclosures and the interest of the shareholders.Meetings of an Audit Committee(a)The number of members of an audit committee will determinethe quorum for the meetings and it should be specified in theterms of reference of the committee;(b)(c)The committee has to meet at least three (3) times in a year;The committee should hold a meeting with the external auditorsat least once a year, without the presence of any executive memberof the board.11.9.12Enforcement and ComplianceAs can be appreciated from the above, the enforcement of good corporategovernance is more of self-regulatory effort than statutory backing inthe UK, USA and internationally. Large institutional investors tend toexert pressure upon companies to improve on corporate governance. Ithas generally been argued that in this issue, voluntary compliance shouldbe encouraged. Where it becomes necessary and applicable, appropriatesanctions should be applied. This is the position adopted by the Securitiesand Exchange Commission (SEC) and Corporate Affairs Commission (CAC)in the enforcement of compliance with corporate governance Code ofBest Practices in Nigeria.11.10 THE CODE OF PROFESSIONAL CONDUCT OF THE INSTITUTE OFCHARTERED ACCOUNTANTS ANTS OF NIGERIA11.10.1 The Institute of Chartered Accountants of Nigeria offers a lot ofguidelines for members to diligently adhere to in its “Rules ofProfessional Conduct for Members.” The Code is introduced by theexpression, “Guidance Not Exhaustive.” It directs that members shouldbe guided not just by the terms, but also by the spirit of the Code. Members233
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FINANCIAL REPORTING AND ETHICS1.3.3
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ACCOUNTING AND REPORTING POLICIESsu
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ACCOUNTING AND REPORTING POLICIES(j
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ACCOUNTING AND REPORTING POLICIES(i
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ACCOUNTING AND REPORTING POLICIES2.
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3AMALGAMATION, ABSORPTION ANDRECONS
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AMALGAMATION, ABSORPTION AND RECONS
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4ANALYSIS AND INTERPRETATION TION O
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ANALYSIS AND INTERPRETATION OF FINA
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5ACCOUNTING STANDARDS5.0 LEARNING O
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ACCOUNTING STANDARDS(i)(ii)(iii)(iv
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ACCOUNTING STANDARDSThere is no SAS
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ACCOUNTING STANDARDS5.2.4 Borrowing
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ACCOUNTING STANDARDS(iii)Certain pe
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ACCOUNTING STANDARDSby venture capi
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ACCOUNTING STANDARDSIFRS 7 Financia
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ACCOUNTING STANDARDSactivity, non-c
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ACCOUNTING STANDARDSin the year inc
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ACCOUNTING STANDARDS(v)(vi)(vii)whe
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ACCOUNTING STANDARDS(v)Actions requ
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ACCOUNTING STANDARDSAccounting stud
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6ETHICAL FRAMEWORK, CONCEPTSAND VAL
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ETHICAL FRAMEWORK, CONCEPTS AND VAL
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7THE ENVIRONMENT: CORPORATE,PROFESS
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THE ENVIRONMENT: CORPORATE, PROFESS
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8PROFESSIONAL ETHICS8. 0 LEARNING O
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PROFESSIONAL ETHICSobjectivity are
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PROFESSIONAL ETHICS(c)(d)The type o
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PROFESSIONAL ETHICSabout conflicts
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PROFESSIONAL ETHICS(d)(e)Confidenti
Page 181 and 182: PROFESSIONAL ETHICSA. III onlyB. II
Page 183 and 184: 9DECISION MAKING IN ETHICS9. 0 LEAR
Page 185 and 186: DECISION MAKING IN ETHICS9.2 A FRAM
Page 187 and 188: ETHICAL THREATS AND SAFEGUARDS(d)We
Page 189 and 190: DECISION MAKING IN ETHICS4. A perso
Page 191 and 192: 10ETHICAL THREATS TS AND SAFEGUARDS
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Page 195 and 196: ETHICAL THREATS AND SAFEGUARDSto th
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Page 201 and 202: ETHICAL THREATS AND SAFEGUARDSimmin
Page 203 and 204: ETHICAL THREATS AND SAFEGUARDSHowev
Page 205 and 206: ETHICAL THREATS AND SAFEGUARDS(iii)
Page 207 and 208: 11CORPORATE GOVERNANCE11.0 LEARNING
Page 209 and 210: CORPORATE GOVERNANCE11.3.1 Nature(a
Page 211 and 212: CORPORATE GOVERNANCEThe company sho
Page 213 and 214: CORPORATE GOVERNANCEtrust, possible
Page 215 and 216: CORPORATE GOVERNANCEAn agent has im
Page 217 and 218: CORPORATE GOVERNANCE(a)(b)(c)(d)(e)
Page 219 and 220: CORPORATE GOVERNANCE11.6.1 The law
Page 221 and 222: CORPORATE GOVERNANCEILLUSTRAUSTRATI
Page 223 and 224: CORPORATE GOVERNANCEimitated. They
Page 225 and 226: CORPORATE GOVERNANCE(a)(b)Greenbury
Page 227 and 228: CORPORATE GOVERNANCE11.9.2 Boards d
Page 229 and 230: CORPORATE GOVERNANCErelationship wi
Page 231: CORPORATE GOVERNANCE(e)(f)(g)(h)(i)
Page 235 and 236: CORPORATE GOVERNANCE(e)ConsultancyA
Page 237 and 238: CORPORATE GOVERNANCEThe incoming au
Page 239 and 240: CORPORATE GOVERNANCEIn summary, acc
Page 241 and 242: CORPORATE GOVERNANCEAccording to Th
Page 243 and 244: CORPORATE GOVERNANCE3. A body corpo
Page 245 and 246: 12SOCIAL AND ENVIRONMENTALISSUES IN
Page 247 and 248: SOCIAL AND ENVIRONMENTAL ISSUES IN
Page 263 and 264: APPENDIX ISUGGESTED SOLUTIONS TO RE
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Page 267 and 268: SUGGESTED SOLUTIONS TO REVISION QUE
Page 269 and 270: APPENDIX IICOMPREHENSIVE QUESTIONS
Page 271 and 272: COMPREHENSIVE QUESTIONS AND SUGGEST
Page 277 and 278: APPENDIX IIICASE STUDY 1Karsashi, a
Page 279 and 280: CASE STUDIES(iii)(iv)The floor sale
Page 281 and 282: CASE STUDIESShare price and dividen
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CASE STUDIESSUGGESTED SOLUTION(A) A
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CASE STUDY 3The following informati
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CASE STUDIESCASE STUDY 4Ologobojo i
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APPENDIX IVTable 1:SUMMARY OF INTER
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SUMMARY OF INTERNATIONAL ACCOUNTING
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APPENDIX VGLOSSARY OF TERMSAbsorpti
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GLOSSARY OF TERMSEthical Objectivis
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APPENDIX VIBIBLIOGRAPHYChambers Ham
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APPENDIX VIISTUDY AND EXAMINATION T
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STUDY AND EXAMINATION TECHNIQUES7.3
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INDEXAAbsorption, 17, 19, 39, 40, 4
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INDEXProfessional Behaviour, 136, 1
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