NSE goes tough on quoted companies

MARCH 29, 2021

By Taofik Salako, Deputy Group Business Editor

Companies that are quoted on the floor of the Nigerian Stock Exchange (NSE) have 72 hours to submit their audited reports and accounts for the 2020 business year.

Erring firms will be liable for monetary and social sanctions, including a tag for poor corporate governance, it was learnt on Sunday.

Post-listing rules at the NSE require quoted companies to submit their annual earnings reports, not later than 90 calendar days 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 terminates on December 31.

NSE’s regulatory filing calendar at the weekend indicated that the deadline for submission of annual report for companies with Gregorian calendar business year ended December 31, 2020 is Wednesday, March 31, 2021.

Regulatory reviews at the weekend showed that nearly half of ‘some 140 companies that are expected to submit their full-year reports by Wednesday have not submitted and are expected to rush through the three-day window before expiration of submission period.

Reports, however, indicated that many companies had completed final reviews and board approval of their results, but are awaiting the final approval of their primary regulator before submission to the NSE. Banks and other related financial institutions are required to submit their financial reports to the Central Bank of Nigeria (CBN) while insurance companies are required to submit to the National Insurance Commission (NAICOM) before release of the financial reports to the investing public.

Many companies have also indicated they plan to submit their financial reports on or before close of work on Wednesday, March 31, 2021, in time for the deadline.

The NSE can grant a general waiver and extension due to special consideration such as national crisis, extended holiday and industrial crisis, sources in the know said the Exchange was not considering any general waiver as there was no basis for that.

The NSE however can give specific waiver to a company based on the strength of reasons in its application for waiver.

NSE tags and applies fines on companies that fail to meet earnings reports’ deadline. Companies that fail to meet the deadline will be tagged with poor corporate governance codes and are liable for sanctions that may range from N100,000 to about N100 million. The NSE is known to suspend trading on the shares of chronic defaulters.

SOURCE: THE NATION

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