TCN fined N47.6 million over non-submission of audit reports

The Transmission Company of Nigeria (TCN) has been fined over N47.6 million (N47,670,000) by the Nigerian Electricity Regulatory Commission (NERC) over the company’s failure to submit its 2013 and 2014 audited financial statements.

According to a document with reference number NERC/Directive/160 signed by the acting Chairman, Dr. Anthony Akah, and General Manager, Legal, Licensing and Enforcement, Mrs Olufunke Dinneh, TCN was given two weeks to pay the fine beginning from December 2, 2016 when the directive was signed.

The fine, according to the regulatory commission, attracts five per cent interest daily after the due date.

In a statement issued by the NERC’s Head of Public Affairs Department, Usman Abba Arabi on Thursday in Abuja, it said failure to submit audited financial report has violated “Section 63 (1) of the Electric Power Sector Reform Act, 2005 that stipulates that a licensee shall comply with the provisions of its license, regulations, codes and other requirements issued by NERC from time to time.”

Other infractions as contained in Directive 160 it said include Condition 4 and 5 of TCN’s Transmission Licence.

Condition 4 stipulates that: “Licensee shall furnish to the Commission information, in such a manner and at such times as the Commission may require at the time and format as may be required by the Commission to perform its regulatory functions.”

Condition 5 of TCN’s licence further directs it to submit audited financial reports to the Commission as detailed in its Transmission Licence.

It explained that the TCN is liable to N10,000 fine daily on each of the three grounds of infractions beginning from April 1, 2014 for failure to submit 2013 audited financial report and April 1, 2015 for 2014 audited financial report being the dates those reports were due for submission till December 2, 2016 when Directive 160 was signed.

The statement reads that, “This gives a total fine of forty seven million, six hundred and seventy thousand naira, which shall be paid by TCN within two weeks from the date of this Directive. Failure to pay the fines within stipulated time shall attract additional interest of five per cent per day until the total fine is paid.”

On the directive, it said: “Take note that this directive is without prejudice to other enforcement powers of the Commission, as contained in its extant laws, rules and regulations.”

The regulatory commission maintained that it had severally reminded the TCN of its obligations to submit audited financial accounting statements for year 2013 and 2014.

It, however, added that the TCN “was found to have persistently refused or neglected to comply with the Commission’s written requests.

“The Commission, thereafter, issued a Notice of Intention to Commence Enforcement (NICE) dated November 17, 2016 requesting TCN to explain why it should not be sanctioned.”

It disclosed that the TCN in its reply had said that the audit exercise has since commenced and almost in its final stage adding that the documents would be submitted once the exercise has been concluded.

NERC, however, said the TCN failed to provide detailed breakdown of activities and time schedule for the completion of the audit exercise so as to guide the Commission to decide on its request for extension of time.

“The Commission finds these responses inadequate and unsatisfactory,” according to Directive 160, hence the sanction.

Meanwhile, the acting Chairman, NERC has urged all licensees in the sector to abide by the commission’s terms and conditions of licence adding that “the era of treating the Commission’s orders, directives and regulations with levity is over.”