FRC Warns Firms Over Breach Of Governance Codes

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FRC Warns Firms Over Breach Of Governance Codes
FRC Warns Firms Over Breach Of Governance Codes

The Financial Reporting Council (FRC) has issued a warning, stating that henceforth, it will hold any accounting professional or company responsible for any breach of its governance codes.

According to the agency, any professional who goes against the core conduct that is expected in the profession will no longer be allowed to practice.

The Executive Secretary and Chief Executive Officer of the council, Dr. Rabiu Olowo, stated this on Thursday after a meeting with the visiting Chief Executive, Association of Chartered Certified Accountants, Helen Brand, in Abuja.

The FRC established by the Financial Reporting Council of Nigeria Act, No. 6, 2011, is responsible for, among other things, developing and publishing accounting and financial reporting standards to be observed in the preparation of financial statements of public entities in Nigeria; and for related matters.

Speaking with journalists, he said the council would also strengthen its enforcement mechanisms to ensure that everyone was held accountable for their actions or inaction that contravenes the FRC laws.

Olowo said, “So, one of the things we could do is to make sure that we do not allow any professional who goes against the core conduct that is expected in the profession to practice.

“If you look at FRC and what the ACCA stands for; we are not just about promoting the works of accountants; we want to make sure we promote and oversight credible work that would lead to credible financial reporting. It’s the kind of alignment that we share as FRC and the ACCA.”

“We want to make sure that we hold to account, accountants, auditors or anyone who is a professional within the financial reporting framework to make sure that they do the right thing and we would hold them accountable to doing the right thing.”

The FRC boss said the council could restrict any professional going against the core conduct that is expected in the profession from practicing.

He added, “We can do that and we have been doing that and we have a joint resolve to ensure that we take that enforcement very seriously going forward.”

During the visit, Olowo emphasised the critical role association has played as the council’s longstanding strategic partner throughout the years.

He said, “ACCA has been a long-term supporter of the FRC, especially in the areas of technical assistance, exchange of ideas and insights with everything that has to do with the profession.

“We see them as a credible partner to discuss issues around financial reporting, corporate governance, and even more specific issues of the future such as sustainability reporting and everything that has to do with areas of our core mandate.”

He pointed out that the FRC had within the last four months, launched two new directorates – the Directorate of Valuation Standards; and the Directorate of Actuarial Sandards.

He said the council had also issued exposed drafts of its new codes of corporate governance for public institutions and not-for-profit sectors for stakeholders’ inputs.

“So, all these areas are the fulcrum of discussions this afternoon to see how we can work with the ACCA to strengthen our technical base and strengthen the outcomes of all of these areas,” he added.

Brand, however, said she was in the country to reinforce the long-term collaboration that the association has had with FRC over the years, adding that the “work never ends”.

She said the accounting profession, like any other profession, has to respond to the emerging global circumstances, particularly the issue of sustainability reporting and practice.

Brand pointed out that the ACCA, remained one of the first bodies to commit to capacity-building partners following last year’s release of the first two sustainability standards by the International Sustainability Standards Board.

She said, “We want to share what we are doing with FRC in promoting the adoption of those standards”.

According to her, Sustainability reporting can drive businesses and sustainable business practices and ultimately save the planet, adding that people need education to drive sustainable practices in their organisations.

Both parties also signed a Memorandum of Understanding to strengthen their commitment to working together.