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20 — Vanguard, MONDAY,

20 — Vanguard, MONDAY, FEBRUARY 12, 2018 FINANCIAL VANGUARD More companies flout NSE’s post listing requirements Continues from page 19 Account 2015, 2016 Account, N46.1million), Austin Laz (Audited Account 2016, N5.4 million), Capital Oil Plc (Audited Account 2016, N1.1 million), CWG Plc (Audited 2016, N2.1 million), Dangote Flour Mills Plc (Audited Account 2016, N500,000), Diamond Bank Plc (Audited Account 2016, N2.4 million), Equity Assurance Plc (Audited Account 2016 N11.2 million), Fidelity Bank Plc (Audited Account 2016 N700,000), Fortis Microfinance Bank Plc (Third Quarter Account 2016, N19.8 million), Guinea Insurance Plc (Audited Account First, Second and Third Quarter 2016, N18.5 million). Others are Premier Paints Plc (Audited Account 2016, N11.2 million), Presco Plc (Audited Account 2016, N1.3million), Royal Exchange Plc (Audited Account 2016, N7.3 million), Standard Alliance Insurance Plc (Audited Account 2016, N8.2 million) and Unity Bank Plc (Audited Account 2016, N500,000). Further analysis by Financial Vanguard showed that four companies did not file their financial performance for first quarter of 2017 (Q1’ 17), nine months after the April 30 deadline. These are Austin Laz & Company Plc, Resort Savings & Loans Plc, Skye Bank Plc, and Smart Product Nigeria Plc. Also, Skye Bank Plc and Smart Products Nigeria Plc did not submit the financial statement for second quarter of 2017 (Q2’2017), six months after the July 31 deadline for submission. Furthermore, seven companies did not submit their audited annual accounts. These are Vitafoam Nigeria Plc, Academy Press Plc, John Holt Plc, Afromedia Plc, Golden Guinea Breweries Plc, Nigerian German Chemical Plc and Roads Nigeria Plc. Early Filers Financial Vanguard investigations also revealed that six companies filed the financial statements ahead of required time. These earlier filers are Infinity Trust Mortgage Bank Plc, United Capital Plc, Omoluabi Mortgage Bank Plc, Unilever Nigeria Plc, PZ Cussons Nigeria Plc and Forte Oil Plc. The early filers are companies that file their interim financial statements at least two weeks before the due date and audited financial statement at least four weeks before due date. In a statement commending the early filers, the NSE said: “Quoted companies on the Exchange are required to file their financial statements on Kola Adedejim, CEO Niger Insuarnce A. Abibu Managing Director , Pharmadeko timely basis in accordance with Appendix iii of the listing rules. “The Exchange has identified these companies that have exceeded the minimum listing rules standards in terms of timely disclosure of their annual audited and quarterly financial performance as early filers. We are extremely proud of these companies and will continue to showcase quoted companies that imbibe high corporate practices.” Reaction from defaulting companies: All the defaulting companies failed to respond to Financial Vanguard enquiries except Skye Bank. Speaking on condition of anonymity, a top official of the bank attributed its default to regulatory delay. Shareholders react: Irked by the upsurge in number of companies flouting a very basic listing requirement of the NSE, shareholders said it is time for the management of the Exchange to review the sanction approach to forestall the rising trend. In separate interviews with Financial Vanguard, they unanimously advocated that the NSE should sanction the directors or company officials responsible for the default instead of sanctioning the company and hence indirectly sanctioning the shareholders. They also suggested that default occasioned by regulatory delays should not be penalised, adding that the Exchange should also introduce an incentive Regulators should rather sanction officers directly involved for failing in his or her responsibility framework to encourage early submission. Mrs. Bisi Bakare, Chairman, Pragmatic Shareholders Association of Nigeria, said “my advice is that those officers of the companies assigned to process returns should do so as Olugbenga Ladipo, CEO Academy Press Cecilia Osipitan, CEO, Great Nigeria Insurance at when due to avoid unnecessary penalties. Also, our regulatory authorities should know that the burden or consequences of penalty is borne by shareholders. This is because the aftermath effect is that topline and bottomline will definitely be affected and dividend proposed will decline and the working capital of these companies will also affected. “On this note, I want our regulators to temper justice with mercy, by looking at other ways to punish these companies that flout listing rules than monetary fine so that our investment will not be affected. The regulators in the banking, capital market and insurance sectors (CBN, SEC, NAICOM) should be up and doing in their responsibilities because most times it is when one regulator or the other does not complete their work on time that it affect prompt filling of results by companies to the NSE.” Mr. Boniface Okezie, Chairman, Progressive Shareholders Association of Nigeria, PSAN, said “The NSE need to further carry out investigation why these Cover companies have failed to meet regulatory requirement. Imposing of fine is not the best, as this action affects the owners of the companies (shareholders) and not the management. It is only when such action is taken and the company fails to provide reasonable reason that a fine could be imposed; and the fine should be imposed on all the officers responsible to turn in the results and not to the firm itself. Also, the Exchange and other regulators should compel companies to state reason for late fillings of results in their annual reports. This will enable shareholders to tackle and hold the management responsible during Annual General Meetings, AGMs . Commenting as well, Mr. Moses Igbrude, Public Relations Officer, Independent Shareholders Association of Nigeria, ISAN, said “There are rules and regulation in our market and operators must abide by them. So, management of companies should be aware of the rules and penalties involved. The management, as our Association always tells them, is to guide against being penalised. Another issue why some companies do not meet regulatory requirement, is because of the numerous regulators in our system. If one regulator delays a company from meeting the requirement of other regulators; should they be held responsible? No, I don’t think it is proper. So, the NSE should look at this issue critically before imposing fine to defaulting companies. Sanctions is not always the best as we normally advise. We think regulators should find a way of rewarding those that meet regulatory requirements; in that case others will learn and be attracted to get such reward subsequently. “Again even when penalties are to be imposed, the officers or directors responsible to turn in results should be punished. We frown at a situation where the entire company or shareholders bear the brunt of the negligence of some few officers. If that is done, you will see that the directors will sit up and do things that will not attract penalty to the company.” Mr. Owolabi Peter, Chairman, Integrated Supreme Shareholders Association of Nigeria, said “In as much that sanction is necessary to make the companies sit up, it is still not the best form of punishment. It is the shareholders’ investment that suffers most. Whether there is fine or not directors are paid their money. The money used in paying these fines is shareholders’ fund. I think regulators should rather sanction officers directly involved for failing in his or her responsibility. In that way they will sit up to avoid unnecessary penalty.”

Vanguard, MONDAY, FEBRUARY 12, 2018 — 21 FINANCIAL VANGUARD Continues from page 19 Forex: Weekly turnover in I&E window nosedives by 56% in the wholesale segment of the market, $55 million On Friday, CBN further the amount released was foreign reserves standing the desire of the CBN to sold in the Small and injected $325.64 million for requests in the at $42 billion, the CBN had ensure that all, particularly Medium Enterprises through the Retail agricultural, airlines, enough in its arsenal to low end users, had access (SMEs), and $55 million Secondary Market petroleum products and maintain the international to foreign exchange to sold to banks’ customers Intervention Sales (SMIS). raw materials and value of the naira as well meet genuine needs, needing foreign exchange Acting Director, machinery sectors. as guarantee access to which prompted the for invisibles such as tuition C o r p o r a t e Speaking further, forex by those requiring it Bankers’ Committee, in its fees, medical payments Communications Okorafor assured that with to meet genuine needs. first meeting of 2018, to and Basic Travel Allowance Department, CBN, Mr. the recession now over and He also reiterated that agree to sell dollars to those (BTA), among others. Isaac Okorafor, said that basis points (bpts) due ouflow occasioned secondary market (Open Market Operations, January Analysts have projected lower (FDC) said: “We forecast that year-on-year M YK C M Y K requiring it for invisibles at the rate of N360 per dollar, without any commission whatsoever. Cost of funds to rise above 50% Cost of funds will further rise to close this week above 50 percent in the interbank money market owing to net outflows which would aggravate the intense scarcity of funds in the market. Last week cost of funds rose by over 3,000 by liquidity mop up by the CBN and sale of fresh treasury bills (TBs). During the week, the CBN sold N136.7 billion worth of primary market (fresh) TBs, as well as OMO) TBs worth N20 billion to mop up liquidity from the market. Although, there was inflow of N67.68 billion from matured TBs, it was not sufficient to forestall decline in market liquidity occasioned by the outflow. In response, short term interbank interest rates rose by 3,253 basis points (bpts) from the previous week levels. Data from the Financial Market Dealers Quote (FMDQ) showed that interest rate on Collateralised lending rose by 3,173 bpts to 43.33 percent last week from 11.6, the previous week. Also, interest rate on Overnight lending rose by 3,333 bpts to 45.5 percent from 12.17 percent the previous week. This trend may persist this week, as the CBN would sell N176 billion worth of fresh TBs, which exceeds expected inflow of N90.03 billion from maturing TBs. Analysts project lower inflation figure for inflation rate for January, saying inflation dropped for the 12 consecutive months during the month. Their projections are coming ahead of the release of the inflation data for January by the Nigeria Bureau of Statistics (NBS) this week. Analysts at Financial Derivatives Company headline inflation will plunge to 14.9 percent in January 2018. This is a 0.47 percent decline from 15.37 percent in December 2017. If our estimates are correct, this will mark the 12th consecutive decline since February 2017. Our forecast is based on a simple regression model and empirical analysis. We expect month-onmonth inflation to flatten out to 0.59 percent (7.33 percent annualized).”