IFAC President: Strong, Effective FRC Key for Virile Economy

*Says Europe grappling with brain-drain, decries low funding for SMEs

James Emejo in Abuja

The President of the International Federation of Accountants Council (IFAC), Mr. Alan Johnson, has said that the Financial Reporting Council of Nigeria (FRC) should be protected and given the resources, it requires to perform its job in the interest of the economy.
He said it was in the best interest of the accounting profession and the country to make sure that regulators are successful and have strong regulatory work in place.

Johnson explained that this would help raise the level of trust and confidence in the profession as well as boost Nigeria’s economy.
Speaking during a meeting with the FRC board and management which was also attended by the President of the Institute of Chartered Accountants of Nigeria (ICAN), Mallam Tijjani Musa Isa, over the weekend, the IFAC president also urged Nigeria to embrace sustainability reporting which he said is at the core of the council’s operations.

He said the Nigerian accounting profession as well as their global counterparts have the mandate to serve the public in the interest of the public and to support governments and organisations to deliver.
The IFAC boss specifically commended Nigeria for having contributed a lot to the accounting profession globally, and for the early adoption of international accounting standards.
He also called for high levels of transparency and governance, adding that the accounting profession should work and support the regulators to ensure a vibrant profession and virile economy.

He said the goal of IFAC was to ensure that sustainability remained at the core of its existence and ensure that the public sector raise the standards of integrity, trust in the people, accountability, and transparency.
He said the SMEs remained the backbone of any economy, stressing that, “we must never forget that and they need to be brought into the conversation, they need to have a role and we need to help them.”

Johnson said only three per cent of any green investment goes to SMEs though they account for more than 50 per cent of GDP.
“So, there is a significant imbalance in the funding of SMEs and we need to help address that.”

Commenting on the issues bordering on Nigerian youth emigration to Europe and other countries of the world, the IFAC president said contrary to speculation, Europe was also struggling with the brain-drain syndrome.
He said, “You might think you’re losing talents from Nigeria to Europe but they (Europe) are also finding it difficult to attract people to come and work in a regulatory environment.”

He said to achieve high levels of transparency and governance, accountants should be encouraged to work in the public sector as well as make their top talents available to regulators, adding that this is in the best interest of the profession.
However, the Executive Secretary/Chief Executive of the Financial Reporting Council of Nigeria, Mr. Shuaibu Ahmed, assured the IFAC president and ICAN that the FRC would continue to align and participate in international developments and be more active in international standards setting.

He said the FRC had recorded a lot of successes, especially with the adoption of the International Accounting Reporting Standards and IPSAS to name a few.
Ahmed said the FRC had also been able to develop the Nigerian Code of Corporate Governance for the private sector in 2018, noting that this has had tremendous success because public entities have been complying with the provisions of the code.
He said the council had also introduced the Audit Regulation 2020 which became effective January this year, adding that this would pave the way for Nigeria to join the International Forum for Independent Regulators.

The FRC boss also said the council is currently developing the Nigerian Code of Corporate Governance for the Public Sector as well as non for profit, explaining that the government has already approved the constitution of the technical working groups.

He said the council was determined to put Nigeria at the forefront in the implementation of sustainability reporting, especially on the African continent.
On his part, the ICAN president expressed the readiness of the institute to partner FRC towards drafting the corporate governance code for the public sector.
He said ICAN had also been working to bring financial literacy to SMEs particularly in the areas of tax clearance and business sustainability, adding that some do not exist beyond their first anniversary because of various constraints.

He added that it was in the interest of the profession that businesses survive.
Among other things, he said the competitiveness of the remuneration package and an enabling environment will forestall brain-drain in the country.