FRC to impose penalties against agencies, parastatals for not submitting annual financial statement

The Financial Reporting Council (FRC) has disclosed that the organisation would soon be imposing fines or penalties against federal government agencies/parastatals that have failed to file in their Annual Financial Statement (AFS) to the council.

Speaking on Tuesday in Abuja at a 2-day national learning and development programme on accounting and financial reporting in the public sector, the executive secretary of FRC, Amb. Shuaibu Adamu, said “so far between the end of 2020 and 2021 to date, a total of 115 public sector entities comprising of government parastatals, government agencies, and government business entities have filed their annual financial statements with the FRC.

“This is a very significant progress. For those who have not filed, we have begun imposing fines and penalties on them in line with the provisions of the FRC act and its extant rules.

“Our experience from the review of this AFS filed with us show that financial reporting in the public sector is confronted with challenges and issues to which this programme is designed to address.

“Our various engagements with the National Assembly further expose the lingering issues of late submission of financial reports by MDAs, lack of proper treatments of accounting issues, poor disclosures, etc” he lamented.

Adamu explained that the “public sector entities play a pivotal role in the national economy as a major driver of productive activities and the largest single business entity.

“As a bedrock of the economy, the importance of financial reporting quality in the national economy cannot be overemphasized.

“Credible financial reports are no doubt germane as they not only support efficient decision making by those charged with governance but also boost the perception index of the country and by extension, enhancing Foreign Direct Investments (FDIs) and Foreign Portfolio Investments (FPIs) as veritable tools and catalysts for the nation’s economic growth.

“Public sector entities are expected to provide financial information that is not only timely but is accurate and useful for decision making and most importantly germane to evaluating the government performance as a bastion of public accountability and stewardship.

“Let me use this opportunity to stress the importance of timely preparation, audit and filing of AFS and also warn against unnecessary delay in this respect.

“A situation where critical institutions of government, some of the apex regulatory bodies, are 2 to 3 years behind in releasing their audited FSs should not and will no longer be tolerated going forward.

“I want to therefore call on the National Assembly to make it a rule that the budget proposals of public sector entities in default of filing their AFS of the previous year would not be considered and approved for the coming year” he stated.

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FRC to impose penalties against agencies, parastatals for not submitting annual financial statement. FRC to impose penalties against agencies, parastatals for not submitting annual financial statement.