The Financial Reporting Council of Nigeria (FRC), has said the 2020 Audit Regulation Exposure draft would boost investor confidence and attract Foreign Direct Investments (FDIs) into the country, as it would provide increased transparency for investors and stakeholders.
According to the Council, the regulation would provide a strong independent public oversight needed in creating and maintaining trust in the work of auditors, by providing safeguards for companies and investors.
Specifically, Executive Secretary/Chief Executive Officer, FRC, Daniel Asapokhai, said the financial crisis has demonstrated the need to embed robust and transparent audit practices in all organizations, noting that the audit regulation is an enabler for re-establishing the much-needed trust in the audit profession.
Speaking at a webinar, titled: “Strategic Assessment of Financial Reporting Council’s Draft Audit Regulation,” organised by Crown Height Consulting, he said the exercise is one of the steps towards finalising the audit regulation.
Asopokhai, represented by the Deputy Director/Head, Directorate of Accounting Standards, Public Sector, FRC, Dr. Iheanyi Anyahara, said the regulation was strategic in realizing the Council’s mission to bring utmost confidence to investors, and ensure quality in accounting, auditing, valuation and corporate governance standards and non-financial reporting issues.
He maintained that great civilisations are built with huge capital, which in turn, requires the certainty that the discipline and integrity of responsible accounting deliver, noting that responsible audit regulation will strengthen the market to attract more patient capital from the global market.
“With the ongoing pandemic, this regulation, providing increased transparency for investors and other stakeholders, are expected to be in high demand. However, assurance by independent qualified professionals to enhance the credibility of corporate reporting will need to be pursued with vigour by all affected stakeholders,” he said.
He called for strict compliance with the regulation by all stakeholders, noting that it would show the need for a re-evaluation of remuneration structures, board-level expertise and training, risk management, and sustainability among others.
Meanwhile, he said the Council has further simplified its registration processes, making registration numbers available within 48 hours of registration and was working on an arrangement to ensure that all stakeholders are involved in the standard-setting processes of international accounting and auditing bodies amongst other initiatives.
He said the audit regulation exposure draft was a culmination of concerted and deliberate efforts of the Council, which started with the setting up of Audit Regulation Working Group (ARWG) on October 30, 2018, which include the big four audit firms, medium size audit firms, forum of Small and Medium Size Practitioners (SMPs), and Office of the Auditor-General for the Federation among others.
“The applicability of this regulation is expected to be a source of concern to many at this auspicious time with the controversy being generated with CAMA 2020.
“However, we are mindful of the fact that the two pieces of legislation are intended to promote trade and investments in Nigeria. The Council appreciates President Mohammad Buhari for the landmark achievement,” he added.