The Nation Newspaper

Tag: delayed results

  • NSE may sanction 35 companies for delayed results

    NSE may sanction 35 companies for delayed results

    The Nigerian Stock Exchange (NSE) may sanction 35 companies for failing to meet the deadline for the submission of their audited reports and accounts for the immediate past business year.

    Post-listing rules at the NSE require quoted companies to submit their earnings’reports, not later than three months after the expiration of the period. Most quoted companies including all banks, major manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31.

    NSE’s regulatory filing calendar indicates that the deadline for submission of annual report for companies with Gregorian calendar business year ended December 31, 2015 was Thursday, March 31.

    While the Exchange had in many instances granted general extension to the earnings deadline, it has maintained silence on any general extension, six working days after the deadline. A source said the Exchange would not grant a general extension noting that the previous extensions were due to special circumstances such as the transition to the International Financial Reporting Standards (IFRS) and the general elections.

    The Nation’s investigation at the weekend indicated that at least 35 companies may be sanctioned by the Exchange. The NSE usually applies both the “naming and shaming” and monetary sanctions on earnings defaulters.

    A report at the weekend indicated that the Exchange has so far this year imposed sanctions totaling N31.6 million on three companies. The companies included Great Nigeria Insurance, N11.3 million; DN Tyre & Rubber, N7.5 million and Daar Communications, which was slammed with N12.8 million.

    The NSE had imposed 50 monetary sanctions on some 30 quoted companies in 2015 over their failure to meet the extended deadline for the submission of their audited reports and accounts for their business year. The fines ranged from N100, 000 to N6 million.

    A report by The Nation on sanctions and fines for similar defaults in 2013 showed that the Exchange slammed about N105.9 million on 48 companies that delayed their results. The fines ranged from N200, 000  to N6.8 million. The NSE slammed N60.2 million as fines on 34 companies for failure to meet deadlines for 2011 audited reports. With a range of N3.8 million and N100, 000, the average fine for the year was N1.77 million.

    While compliance within deadline is generally regarded as a measure of good corporate governance, NSE tags and applies fines on companies that fail to meet earnings reports’ deadline.

    Under the corporate governance and rules compliance assessment report known as X-Compliance Report, NSE identified four different kinds of tags or symbols to alert investors about the status of each quoted company. These include below listings standard (BLS), the first degree alert level indicating a company that has not complied with post listing rules such as late submission of financial statements, unauthorised publication, and management failures, among others.

    Also, financial services companies such as bank and insurance companies awaiting regulatory approval will carry the appropriate symbol of awaiting regulatory approval (ARA). Companies that are undergoing a capital reconstruction exercise including supplementary issue, share buyback, split, share reconstruction among others will be tagged with capital reconstruction exercise (CRE) while companies that have indicated that they will be delisting or companies that are being delisted at the instance of the regulator would be flagged with delisting in process (DIP) symbol.

     

     

  • Companies risk huge fines, delisting on delayed results

    Companies risk huge fines, delisting on delayed results

    Quoted companies with habitual and long delay in the submission of their periodic interim and annual audited reports and accounts would henceforth pay heavy fines and may be delisted as the Nigerian Stock Exchange (NSE) revises its rules on filing of accounts and treatment of default filings.

    Companies with chronic history of delay in submission of quarterly and annual reports could pay as much as N100 million fine in some instances, it was gathered.  Average fines may increase to N20 million; based on recent delayed filings. Fines imposed under the existing rules ranged from N100, 000 to N7.1 million. The highest fine of N7.1 million was imposed on Daar Communications Plc.

    The NSE had come under sharp criticisms over its complicity and negligence on long delays in filing of periodic and annual reports, which allowed many companies to hide poor performance and material information. An oil and gas company reported a cumulative net loss after tax of N240 billion after it delayed its annual report and interim report for first and second quarter until the 11th month of the new financial year. The company merely received a fine of N6.2 million for the delay of the three results.

    Under the new rules currently undergoing review, any late submission of accounts shall attract a fine of N100,000 per day for the first 90 days of non-compliance; N200,000 per day for the next 90 days of non-compliance and N400,000 per day thereafter until the date of submission.

    Besides, any issuer or quoted company shall be liable to pay additional fines of a fine of 50 per cent of its annual listing fee; and N25,000 for every day it remains in default for each instance of non-compliance with any directives of the NSE under the new rules.

    The new rules, which draft company was obtained by The Nation, shall be applicable to all companies and securities on the main and premium boards of the NSE.

    The new rules also highlighted a seeming naming and shaming fine under which defaulted company and the Exchange are required to publish the instances and circumstances of the default in at least two national newspapers and the corporate website.

    The Exchange is also empowered to suspend trading on the shares of a defaulting company, issue a caution on trading on the shares of the company and where the NSE decides that the failure has become incurable based on repeated and sustained delay records, it can take steps to delist the shares of the company.

    Also, no quoted company or issuer of a security shall declare interim dividends, final dividends or bonuses or take any other related corporate action without first preparing and filing audited accounts, which shall form the basis of such declaration or action.

    “Any issuer that violates this provision shall be liable to pay a fine of 5 per cent of the nominal value of the dividends or bonuses, or any other related corporate action, and the applicable fine shall not exceed 100 per cent of the nominal value,” according to the draft rules.

    According to the rules, every company shall file its unaudited quarterly accounts not later than 30 days after the relevant quarter, and publish it in at least two national daily newspapers, and post it on the company’s website, with the web address disclosed in the newspaper publications.

    A company that chooses, in addition, to audit its quarterly accounts shall file such accounts not later than 60 days after the relevant quarter, and publish it in at least two national daily newspapers and post it on the company’s website, with the web address disclosed in the newspaper publications.

     

     

     

    Audited year-end accounts must be filed with the Exchange not later than 90 days after the relevant year-end, and sent to all shareholders or published in at least two national daily newspapers and posted on the company’s website with the web address disclosed in the newspaper publications.

    No later than two business days after the deadline for filing accounts has passed, the Exchange shall send a filing deficiency notification to every defaulter and within three calendar days of the date of the filing deficiency notification, the defaulter shall be required to issue a press release, of not less than half a page, in at least two national daily newspapers and posted on the issuer’s website disclosing that the relevant accounts have not been filed by the due date; a detailed explanation of the reasons for the delay; and the anticipated filing date; or its inability to indicate the anticipated filing date, and reasons for the inability to indicate the anticipated filing date.

    A defaulting company is also expected to apply for an extension of time for filing the relevant quarterly or year-end accounts, but this shall not be longer than eight weeks from the due date for the relevant accounts.

    In the event that a company is subject to oversight by a specific primary government regulator, like the Central Bank of Nigeria (CBN) for banks, the Exchange may grant an additional period not exceeding 12 weeks from the due date for the relevant accounts. The company must however produce evidence of filing the relevant accounts with such primary government regulator not later than four weeks before the due date of filing with the Exchange.

    General Counsel and head of regulation, NSE, Ms Tinuade Awe, said the National Council of the Exchange, its highest body, decided on the draft new rules because it discovered that the disclosure requirements as well as the sanctions provided in the initial rules were not stringent enough to deter violations of the Exchange’s listings requirements with regard to financial disclosure.

    She pointed out that the National Council was of the view that in order to ensure greater compliance, additional measures apart from higher financial penalties should be introduced into the provisions relating to financial disclosures.

    She said the new rules would promote adequate investor protection, prompt and sufficient information sharing, accountability, and transparency within the market.

    “These measures are intended to instill greater diligence, prompt, detailed and more responsible disclosure with regard to financial reporting; whilst simultaneously achieving greater deterrence to issuers against repeated late filing of their financial statements,” Awe said.

  • ‘Our fears over delayed results’

    ‘Our fears over delayed results’

    All is not well at the Faculty of Law of the Obafemi Awolowo University (OAU) in Ile-Ife, Osun State. Three months after graduating students wrote their final examination, the faculty is yet to release their results to enable them proceed to the Law School. The affected students blame it all on what they call the faculty staff’s laziness. DAMILARE FAMUYIWA reports.

    •OAU Law students’ results yet to be compiled

    How does it feel to complete a Law programme beyond the stipulated time and yet, one’s expectation to being called to the Bar is deferred? It appears not to be a good experience. This is the predicament of the graduating Law students of the Obafemi Awolowo University (OAU) in Ile-Ife, Osun State.

    It is three months after the Law students wrote their final examination, but the results  have not been compiled. The students have been in a state of dilemma, since the deadline for enrolment at Nigerian Law School closed on July 17.

    Some graduates of the faculty told CAMPUSLIFE that it was not the first time the insitution would unnecessarily delay students’ results. A former student, who simply gave himself as Temitayo, said: “OAU has a problem with getting its students ready for law school on time. Even to moblise its graduates for National Youth Service on time has been a challenge for the school. This drag-footing seems to be a culture in the school. Maybe that is why our students don’t perform excellently well when they get to the Law School, because while other students are attending classes, OAU students will be busy with settling down.”

    After spending six years for a five-year course, Shade, one of the affected staff’s students, attributed the delay in processing their results on the Faculty laziness. “We are definitely going to be sent to the worst campuses and given poor accommodation. I really do not understand this school,” she said.

    A student, who simply gave his name as Bidemi, said: “The faculty should process our results as quickly as possible and send our names to the Law School. The most important thing now is to enrol for our Bar programme on time. We are not even bothered about the location of the campuses again; even if it is Kano or Yola, we would all be glad to go.”

    Another student, who gave his name as Yinka, said students’ long essays had not been marked by the lecturers, which, he said, may be the reason students’ results were still being delayed. “We do not even know those who are going to be moblised for the Bar programme and those that are not,” said.

    CAMPUSLIFE gathered that the delay may have been as a result of ongoing Non-Academic Staff Union (NASU) strike and the forced mid-semester break announced by the school management. Many students saw this as untenable excuse for the school’s failure to send their names to Law School.

    Reacting, an affected student, who simply identified himself as James, said: “That is not an excuse. The faculty had up to 10 weeks before the NASU strike started. It should be noted we were supposed to have gone to law school if the faculty was willing to speed things up. It is just appalling our future is being put in hold by the lazy staff.”

    A student said schools, such as (UNIBEN) have already sent the names of their University of Benin graduates to the Nigerian if Law School before their final examination, which comes up in September. “Meanwhile, our matric numbers are not even recognised on the Law School’s website. This is bad. Staff of the faculty must change their ways, if not, their laziness would continue to affect students’ performance at the law school,” the anonymous student said.

    When asked about the consequences of failure of the school to mobilise students for the Bar programme, Ebuka, one of the final year law students said: “Everybody will suffer for this indiscretion, including the set of students coming after us. This is because none of them would be able to go to law school for one full year after graduation. All we are saying is, let our lecturers mark our papers, upload our results and mobilise us for law school.”

    Another student, who gave his name Oluwaseun, lamented: “I think it is irresponsible for the faculty to take us through the waiting game. It does not speak well of the school and there are no excuses that can validate it. Since April after our final examination? I pray we can still make law school this year.”

    CAMPUSLIFE gathered that the affected students have approached the faculty leadership to make enquiries about their fate but it was learnt that the faculty gave no definite answer to allay the fears of students.

    The Dean, Prof Olu Adediran, urged for calm, saying the students’results would be released soon. He said: “The students will see their results soon, but I cannot confirm when the results will be released. But, we have forwarded the names of the students to the Law School for enrolment.”

  • NSE to sanction 40 firms over delayed results

    NSE to sanction 40 firms over delayed results

    The Nigerian Stock Exchange (NSE) may sanction at least 40 companies over their failure to meet the extended deadline for the submission of their audited reports and accounts for the immediate past business year. The 30-day extension of the deadline for the submission of the audited annual report for companies with Gregorian calendar year expired  on April 30.

    Following an exclusive report by The Nation that more than two-thirds of quoted companies have not submitted their audited reports at the expiration of the initial regular deadline of March 31,  the NSE had extended the March 31 deadline by one month. With these companies that operate the Gregorian calendar year as their business year had up till April 30 to submit their full-year audited reports and accounts.

    The Nation’s check yesterday indicated that some 40 companies have not submitted their earnings reports and now are liable for sanctions by the Exchange. The NSE usually applies both the “naming and shaming” and monetary sanctions on earnings defaulters.

    A report on sanctions and fines for similar defaults in 2013 showed that the Exchange slammed about N105.9 million on 48 companies that delayed their results. The fines ranged between N200, 000 and N6.8 million. The NSE had slammed some N60.2 million as fines on 34 companies for failure to meet deadlines for 2011 audited reports. With a range of N3.8 million and N100, 000, average fine for the year was N1.77 million.

    While compliance within deadline is generally regarded as a measure of good corporate governance, NSE tags and applies fines on companies that fail to meet earnings reports’ deadline.

    Under the corporate governance and rules compliance assessment report known as X-Compliance Report, NSE identified four different kinds of tags or symbols to alert investors about the status of each quoted company. These include below listings standard (BLS), the first degree alert level indicating a company that has not complied with post listing rules such as late submission of financial statements, unauthorized publication, management failures among others.

    Also, financial services companies such as bank and insurance companies awaiting regulatory approval will carry the appropriate symbol of awaiting regulatory approval (ARA). Companies that are undergoing a capital reconstruction exercise including supplementary issue, share buyback, split, share reconstruction among others will be tagged with capital reconstruction exercise (CRE) while companies that have indicated that they will be delisting or companies that are being delisted at the instance of the regulator would be flagged with delisting in process (DIP) symbol.

    Some of the companies that may be sanctioned for the 2014 earnings reports included Daar Communications Plc, Juli Plc, Fortis Microfinance Bank, UTC Nigeria, Ellah Lakes, RT Briscoe (Nigeria), Lennards, Beco Petroleum FTN Cocoa Processors, Japaul Oil and Maritimes Services and Multiverse Nigeria Plc.

    Others included Nigerian Ropes, Omatek, Aso Savings and Loans, Infinity Trust Mortgage Bank, Austin Laz and Company, Oando, Conoil, Premier Paints, IPWA and Africa Paints Plc.

    Post-listing rules at the NSE require quoted companies to submit their earnings reports, not later than three months after the expiration of the period. Most quoted companies including all banks, major manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31.

    NSE’s regulatory filing calendar had indicated that the deadline for submission of annual report for companies with Gregorian calendar business year was Tuesday March 31. They were also expected to submit their first quarter report on or before June 30,. These deadlines were, however, extended to April 30 and July 30, respectively.

    The NSE had stated that the extension was due to some challenges created by shift in the date of national elections from February 14 to March 28 and the layers of regulations for some audited reports.

    According to the NSE, the change in the election calendar also disrupted the meeting calendar and auditing process of some listed companies while some were not able to obtain the prior approval of their primary regulators.

    “While we believe that the timely disclosure of financial information is critical to stakeholders in the capital market, particularly the investing public, the challenges which the listed entities are facing are germane,” NSE stated in a statement signed by Josephine Igbinosun, head of listings regulation department.

  • NSE may sanction 150 companies over delayed results

    NSE may sanction 150 companies over delayed results

    As the deadline for quoted companies to submit their audited reports and accounts for the year ended December 31, 2014 expired yesterday, there are indications that the Nigerian Stock Exchange (NSE) may sanction some 150 companies over their failure to submit their period within the period.

    Post-listing rules at the NSE require quoted companies to submit their earnings reports, not later than three months after the expiration of the period. Most quoted companies including all banks, major manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31.

    NSE’s regulatory filing calendar indicates that the deadline for submission of annual report for companies with Gregorian calendar business year was yesterday.

    The Nation’s check at the NSE yesterday showed that several companies have not submitted their audited reports while several other companies were making last-minute efforts to scale the deadline and avoid the poor corporate governance tag and sanction of the NSE.

    A headcount by The Nation indicated that less than a third of quoted companies have submitted their audited earnings report. There are more than 230 companies quoted on the NSE. Less than 60 companies have submitted their annual reports as at the last count.

    Companies that have submitted their 2014 audited results included Unilever Nigeria, FCMB Group, Nigeria Aviation Handling Company (Nahco), Julius Berger Nigeria, Livestock Feeds, United Bank for Africa (UBA), First Aluminium Nigeria, Sterling Bank, Dangote Cement, Lafarge Africa and Cadbury Nigeria Plc.

    Others included Zenith Bank, Transcorp Hotel, Guaranty Trust Bank, Nestle Nigeria, Forte Oil, Africa Prudential Registrars, Chams Plc, United Capital, Caverton Offshore Support Services, Eterna, Mobil Oil Nigeria, Fidson Healthcare, Total Nigeria, Greif Nigeria, Unity Bank, Wema Bank, Courteville Business Solutions, Wapic Insurance and Nigerian Breweries among others.

    A report on sanctions and fines for similar defaults in 2013 showed that the Exchange slammed about N105.9 million on 48 companies that delayed their results. The fines ranged between N200, 000 and N6.8 million. The NSE had slammed some N60.2 million as fines on 34 companies for failure to meet deadlines for 2011 audited reports. With a range of N3.8 million and N100, 000, average fine for the year was N1.77 million.

    A source at the NSE said the Exchange was committed to enforcing its rules and regulations, especially the post-listing rules that define the integrity of the market.

    NSE tags and applies fines on companies that fail to meet earnings reports’ deadline. Under the corporate governance and rules compliance assessment report known as X-Compliance Report, NSE identified four different kinds of tags or symbols to alert investors about the status of each quoted company.

    These include below listings standard (BLS), the first degree alert level indicating a company that has not complied with post listing rules such as late submission of financial statements, unauthorised publication, management failures among others.

    Also, financial services companies such as bank and insurance companies awaiting regulatory approval will carry the appropriate symbol of awaiting regulatory approval (ARA). Companies that are undergoing a capital reconstruction exercise including supplementary issue, share buyback, split, share reconstruction among others will be tagged with capital reconstruction exercise (CRE) while companies that have indicated that they will be delisting or companies that are being delisted at the instance of the regulator would be flagged with delisting in process (DIP) symbol.