The Financial Reporting Council (FRC) is soliciting the National Assembly’s support to stop approving budgets for government entities that fail to submit their Annual Financial Statements [AFS] on time as required by law
Recall that the Financial Reporting Council of Nigeria was established by Act no 6, 2011 under the supervision of the Ministry of Industry, Trade and Investment to, among other things, develop and publish the accounts and financial reporting standards to be observed in the preparation of financial statements of Public Interest Entities (PIEs).
FRC Executive Secretary, Shuaibu Adamu Ahmed, disclosed this yesterday, in his address at a two-day national learning and development programme on accounting and financial reporting in the public sector, in Abuja.
He said that the council has resolved to set a good example by ensuring that its 2021 AFS are prepared, audited and filed within two months after the end of the 2021 financial year.
He noted: ‘’We are not unmindful of the existing challenges being faced by Ministries, Departments and Agencies (MDAs) in accessing their monthly bank statements on a timely basis from the Central Bank of Nigeria (CBN) since the commencement of the Treasury Single Account [TSA]. We are equally aware of the challenge of carrying out monthly bank reconciliations as a result of the current CBN aggregation of transactions on the bank account statements rather than showing individual transactions.
“These challenges certainly cause unprecedented delays in the preparation of accounts and financial statements of public sector entities. We are, however, currently liaising with the Office of the Accountant General to ensure the problems are quickly resolved.”
He lamented that between the end of 2020 and now, 115 public sector entities composed of government parastatals, agencies have filed their yearly statements with the FRC.
In his keynote address, the Minister of Industry, Trade and Investment, Adeniyi Adebayo, frowned at some public sector entities that still use the Statement of Accounting Standards (SAS) issued by the defunct Nigerian Accounting Standards Boards (NASB) as their reporting framework while others use a number of other formats.
He stated that the lack of uniformity hinders credible financial reporting and makes comparability difficult.