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Saturday, April 1

44 Firms Meet NSE Deadline For Audited 2016 Results

As the deadline for quoted companies to submit their audited results for the financial year ended December 31, 2016 expired over the weekend, only about 44 companies have met the deadline.
Post-listing rules at the NSE require quoted companies to submit their audited earnings reports not later than 90 calendar days or three months after the expiration of the period.
The rules also require quoted companies to submit interim report not later than 30 calendar days after the end of the relevant period.
LEADERSHIP Sunday checks at the NSE on Friday March 31, 2017, being the last day, revealed that only 44 companies have submitted their audited results out of 210 companies, representing 21 per cent, while 79 per cent or 166 companies are yet to file in their reports.
There are indications that the NSE may sanction the companies who are unable to meet the deadline.
The NSE has named some companies early filers. According to Exchange, these are companies that file their interim financial statements at least two weeks before the due date and audited financial statements at least four weeks before the due date.
The early filers are Dangote Cement, Forte Oil, United Capital Plc, Nigerian Breweries, Transcorp Hotel, Africa Prudential Registrar and Zenith Bank.
Among the companies that have complied are Access Bank, Dangote Sugar Africa Prudential Registrar, Continental Reinsurance, Guaranty Trust Bank, Nestle Nigeria, Total Nigeria, Transnational Corporation of Nigeria, Unilever Nigeria, Stanbic IBTC Holdings, Lafarge Africa, Cadbury Nigeria, MRS, Grief Nigeria, Multiverse Mining, UACN and Union Bank.
For failure to file audited reports timely, the NSE sanctions range from penalties to regulatory delisting of the securities from the daily official list of the Exchange.
These penalties that accrue on a weekly basis and further depletes the bottom-line of the companies’ earnings are also expected to be disclosed in the annual reports of the companies.
The head of Legal and Regulation Division of NSE, Tinuade Awe, said, “Late filing has the potential to adversely affect the market and their shareholders. It creates grounds for avoidable doubts regarding companies’ performances. The Exchange is monitoring the compliance status of these companies very closely and is engaging the affected companies accordingly.
“We encourage investors to always check the X-Compliance Report and Released Financials on our website for full details of the compliance status of listed companies before making investment decisions”.
An analyst who spoke on condition of anonymity said the NSE needs to be firmer in the enforcement of its rules and regulations.
He added that most of the time, defaulting companies are made to pay paltry sums as fines, while a lot more do not bother to pay fines levied on them because there is usually no follow-up by the sanctioning body.
According to him, sometimes the exchange remains silent, just like when Oando Plc delayed its 2014 results by several months, only to release it in 2015, with a loss of N183 billion, one of the largest in Nigeria’s corporate history.
He also called on shareholders to pay closer attention. “They are often concerned with dividends, bonuses and profits. The section on companies’ annual reports where fines are stated are usually not emphasized enough for shareholders’ attention. Also, many shareholders lack the rudimentary understanding of financial statements”, he added.
A stock analyst with Calyst Securities Limited, Mr. Tunde Oyediran, pointed out that the end year results of the companies released so far have been mixed performance and has not really impacted positively on the stock market performance.
He added that the stock market is witnessing a down trend as investors react to the less than satisfactory earnings releases of quoted companies.
Also speaking, the managing director of Highcap Securities Limited, Mr. David Adnori, urged management of listed companies to ensure timely release of their result, saying the stock market is information driven.
He also said that there must cooperation between all regulators, especially for firms that are subject to more than one regulator.
According to him, while the Central Bank of Nigeria (CBN), for example, has mandated that banks should have December as a common year-end, other industries should follow suit.
He said, “Perhaps it is also time for the NSE to increase the amount of fines it imposes. If the fines become significantly large, both shareholders and managements of companies will sit up. The NSE needs to be bolder by suspending some firms from trading due to late submission of results.
“That way, the companies will take deadlines seriously. Tardy submission of results is another reason why investors don’t take the Nigerian stock market seriously”.

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