By Uzoma Akobundu
Oando Plc is crying foul over the N160million the Securities and Exchange Commission (SEC) had imposed on her to make room for comprehensive Forensic Audit of its accounts by five tested audit firms.
Armadanews.com got it on good authority at the weekend that the leadership of Oando Plc is kicking that the SEC should impose such huge amount on the firm which they think may have been done in bad faith.
There are insinuations the SEC has not lived up to its market regulatory responsibility, sitting by and waiting for Oando Plc to fall foul of the numerous alleged infractions which the Commission is now wanting to probe.
“Is it now that the SEC is realizing that Oando Plc has been manipulating its books? Has not the company been featuring at the market, and was it not the duty of the SEC to look more critically at the books presented to them. If you ask me, government ought to also probe the SEC management over this Oando saga because what is playing out, if we are serious, is a connivance from both ends,” a stakeholder told Armadanews.com.
Another stakeholder said Oando has always been mentioned for the wrong reasons but SEC and NSE, the regulatory agencies failed to wade into the barrage of allegations involving the firm and the feeling so many people get is that they work together.
“To ensure the independence and transparency of the exercise, the Forensic Audit would be conducted by a consortium of experts….The cost implication of the exercise is N160,000,000.00 (One Hundred and Sixty Million Naira) and shall be borne by Oando Plc,” said SEC in what looks like a memo that has “nailed” Oando which the regulatory organ released last week in the possession of Armadanews.com.
The memo written to Adewale Tinubu, Group Chief Executive Officer of Oando on October 17 and signed by one Braimah Anastasia, Head, Legal Department of SEC and catalogued what appears like all the “sins” of Oando Plc noted that SEC expected the firm “to give all necessary support and cooperation to ensure the success of the Forensic Audit.”
SEC appointed Akintola Williams Deloitte to lead the team of four other experts to undertake the audit of Oando, which books have become subject of doubts of late.
Other experts appointed by SEC include the registrar, United Securities Limited; the law firm, SPA Ajibade & Co; Tjadap Consulting and Associates; and Nasiru Muhammad & Co.
On Wednesday, October 18 SEC had directed the NSE to place Oando’s shares on full suspension for two days and on a technical suspension with effect from Friday, October 20 following the probe into two petitions received from the duo of Alhaji Dahiru Barau Mangal and Ansbury Inc, both shareholders of the company.
SEC said the suspension was to enable it conduct a forensic audit into the affairs of Oando, which is listed on the Nigeria Stock Exchange (NSE) and Johannesburg Stock Exchange (JSE).
SEC said in a statement concerning the forensic audit: “To ensure the independence and transparency of the exercise, the forensic audit will be conducted by a consortium of experts made up of auditors, lawyers, stockbrokers and registrars.”
The SEC last week, advised the NSE to suspend trading in Oando shares until further notice.
The Commission said it carried out a comprehensive review of the petitions from Alhaji Dahiru Barau Mangal and Ansbury Inc and arrived at the following findings among others; Breach of the provisions of the Investments & Securities Act 2007; Breach of the SEC Code of Corporate Governance for Public Companies; Suspected insider Dealing; Related party transactions not conducted at arm’s length; Discrepancies in the shareholding structure of Oando Plc. Etc.
The Commission noted that the above findings were weighty and therefore needed to be further investigated.
The Commission said it believed that it was necessary to conduct a Forensic Audit into the affairs of Oando Plc in pursuant to the statutory duties of the Commission as provided in section 13(k), (n), (r) and (aa) of the ISA 2017.
The SEC said to ensure the independence and transparency of the exercise, the Forensic Audit shall be conducted by a consortium of experts made up of auditors, lawyers, stockbrokers and Registrars.
Time To Watch the Watch Dog
Armadanews.com reported in July this year that for four, Nigeria’s SEC has reneged in publishing its annual report which was last seen in 2013.
Stakeholders are therefore asking the question: Who will regulate the regulator? They think that the Mounir H. Gwarzo-led team at the SEC has failed to adhere to the Corporate Governance rules with regard to annual reports and accounts.
While companies are mandated to publish their annual report and frequently get sanctioned for failing to do so, the SEC itself has reneged on publishing its annual report and accounts in keeping to the rules on Corporate Governance.
Armadanews.com gathered that the last time SEC published its annual report and account was in 2013, the soft copy of which could be seen on its official website.
The implication is that SEC only succeeded in keeping Nigerians and investors in the dark on its annual report and financial accounts for the past four years.
SEC annual report and account is meant to show among others, its operational activities, report on legal and enforcement activities, and annual accounts.
The account was signed by its past chairman, Suleyman A. Ndanusa and Arunma Oteh, the then Director-General, Securities and Exchange Commission who later joined the World Bank as Vice President and Treasurer.
With a mission to develop and regulate a capital market that is dynamic, fair, transparent and efficient to contribute to the nation’s economic development, SEC Nigeria claims itself Core Values are: Transparency, Integrity, Pro-activeness, Fairness, Excellence, Accountability, and Teamwork.
The Securities and Exchange Commission was established in 1979 as a government agency to regulate and develop the Nigerian capital market.
It derives its mandate from the Investments and Securities Act (ISA), No. 29, 2007. The Commission is the apex regulatory body of the Nigerian Capital Market, responsible for the regulation and development of the market and seeks to protect the rights and benefits of investors with the purpose of ensuring an efficient and widespread participation by the public in the securities market.
Its responsibilities include registration of securities offered to the public by corporate entities, collective investment schemes and the government i.e. public issue, private placement, rights issue, as well as the regulation of market intermediaries, mergers, acquisitions, takeovers and all forms of business combinations.
The Commission’s objectives include: ensuring the existence of a stable, orderly, transparent, fair, efficient and viable market that protects investors and is internationally competitive; effectively enforce the ISA, 2007, Rules & Regulations and Codes made pursuant thereto as well as other relevant laws, maintain zero tolerance for market abuses; develop and deepen the market by promoting the introduction of new products and processes; and contribute to the nation’s economic growth and development.
The Memo That Nailed Oando Plc
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