• Presidency embarrassed
THE smooth take off of in office of the new Central Bank governor, Mr. Godwin Emefiele, ran into stormy waters recently due to the unauthorized uploading of the apex bank's 2012 financial report on the apex bank's website. National Daily learnt that
the presidency was irked by that development which led to Mr. President summoning the Attorney General of the Federation Mr. Mohammed Bello Adoke over the issue. A source at the Presidency told National Daily that the Attorney General verbally queried Mr Emefiele on why the apex bank uploaded on its website, a report he is well aware of the issues and controversies surrounding it. This led to the pulling down of the 2012 Financial Report as soon as words got to the Bank that the President was embarrassed by their action. The source further hinted that the President got in touch with the Attorney General of the Federation Mohammed Bello Adoke to look into the consequences that may arise from the publication of the said report. The attorney general was said to have informed the CBN governor on the legal implications of such, especially as the Federal Government, and other agencies of the government are still in court with the erstwhile governor of the Bank, Sanusi Lamido Sanusi on issues bordering mostly on the 2010 report of the Bank.
National Daily also learnt that the Financial Reporting Council of Nigeria expressed their reservations on the issue to the Central Bank Management. The FRC was said to have demanded that the Bank investigate what led to that brazen development especially as all members of the bank's senior management team are in the know of the controversies trailing that Report and that it is responsible for a pending court case.
However, a source at the Central Bank told National Daily that contrary to insinuations that the governor was ordered to yank the Report off the Bank's website, that it was the governor who ordered that the 2012 report be pulled down from the website. According to this source who craved anonymity because this issue is outside her jurisdiction, it was the Bank's Director of Research Dr. Charles Mordi who without approval from the Board or the governor instructed one of his staff to upload the Report in the website. Sensing that such directive might put him in trouble, the said staff requested that the Director put the request in writing as an approval from him, which he did, and the Report was approved. She further said that a day after the entire Bank was in turmoil as people were seen running around discussing in hush tones. It was later that the news broke that some people who knew how controversial that report was and the problem it could cause the management of the Bank brought it to the knowledge of the governor and deputy governor Dr. Sarah Alade. This development the source said did not go down well with the governor who ordered the Dr. Mordi to yank off the report from the website with immediate effect. A flustered Mordi was said to have denied giving the approval for uploading of the report, shifting the blame on the technical officer who obeyed an instruction.
It could be recalled that the bank's inability to publish its 2012 financial report was responsible for the crisis that led to the suspension of the former CBN governor. Prior to the suspension of the governor, questions were raised over the 2012 financial report of the Bank because of series of infractions detected in the apex bank's audited account for the year. The situation then led to talks within the financial sector that the Bank cannot balance its book. That was heightened by the fact that the apex bank's auditors Ernst and Young went through without appending their signature on the report, a pointer to the fact that they were not convinced about the bank's account. This was based on the fact that an audit report is worthless if it does not carry the signature of the auditor.
This led to the suspension of Mallam Sanusi Lamido Sanusi. It is on record that the President based on the preliminary findings of the FRC that reviewed the bank's operation and its 2012 account, which the CBN board and Ernst Young, its auditor did not signed wrote to the National Assembly,and the board of the CBN to intimate them on why the government decided to suspend the governor.
It could be recalled that the governor was queried over 22 infractions discovered in the apex bank's book. The response, it was learnt, was not satisfactory while the Presidency also wanted to put things in proper order ahead of the resumption of a successor to Sanusi Lamido who is expected to leave office on June 2. Sources disclosed that the bank's management violated Sections 6, 49, and 50 of the CBN Act and this is reflected in the accounts and explain why the accounts have not been signed by relevant authorities. Section 6 (3d) provides that the board of the bank shall make recommendation to the President for the appointment of auditors in accordance with Section 49 of this act, the provision of the necessary facilities and the rates of remuneration. Presidency sources said the CBN management did not seek the approval of the President on the appointment of Ernst and Young, its auditor and the N400 million allegedly approved as its remuneration.
The management also ran foul of Section 49 (4) of the CBN Act which stipulates that “the bank shall as soon as may be practicable after the last day of each month make up and publish a return of its assets and liabilities as at the close of business on that day, or if that day is a holiday, as at the close of business on the last preceding business day.”Section 50 (5) provides that “a copy of the return referred to shall be forwarded to the president and shall be published in the gazette.”
Sources also revealed that the current management has never, since the assumption of office of Sanusi, published its account or submitted its monthly report to the President or publish them in the gazette.The Presidency is also said to have condemned the failure of the apex bank to transit to the International Financial Reporting Standards (IFRS), the new accounting regime which banks under its supervision have since adopted. Sources said the Presidency became suspicious when the CBN could not submit its 2012 account to the Financial Reporting Council (FRC), the body with the mandate to ascertain the compliance of companies with IFRS. Rather, the bank requested seven years' grace for it to be able to transit to IFRS. The President reportedly gave the CBN account to the FRC for review and part of the issues allegedly detected is the refusal of its auditors, Ernst and Young, to sign the account but rather, saying that it complied with the CBN Act.
There is also, according to Presidency sources, alleged discrepancies in the 2012 account of the Nigerian Security Printing and Minting Company, a subsidiary of the apex bank.
“In the account of Mint, N29 billion was recorded as the turnover as against N60 billion in the book of the apex bank. Other issues include the donations to some higher institutions but which findings allegedly show was inflated. Bayero University Kano was said to have collected only N1 billion as against N4 billion allegedly reported by the apex bank. There are other illegal donations to churches, mosques and sundry sources, which the CBN Act never provides for.”
There were concerns then that the complicated accounts of the apex bank will pose challenges to Sanusi's successor especially being that the accounts are not balanced and were not signed. Moreso, the state of health of the apex bank's annual statement became suspicious when the governor refused to submit it to the Financial Reporting Council (FRC) the body with the mandate to ascertain the compliance of companies with accounting standards, and the International Financial Reporting Standards, IFRS. Rather than submitting it to the body, the governor requested for seven years' grace for the CBN to comply with FRC stipulations. The former governor later went to court concerning what he called harassments by the FRC.
All these were responsible for the manner in which both the presidency, the office of the Attorney General of the Federation, and the FRCN handled the uploading of that controversial report. A legal expert who spoke with National Daily said that with the case in court, the management of the CBN erred in uploading the report because it has the potential of rubbishing the integrity of the government internationally. Moreover, Sanusi could use it against the government in court.
Culled from the National Daily Newspapers
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