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ICAN, FRC to Tackle Asian Firms for Fraudulent Accounting(AllAfrica Via Acquire Media NewsEdge) THE Institute of Chartered Accountants of Nigeria (ICAN) and the Financial Reporting Council of Nigeria (FRC), last week, launched series of shared initiatives among which is blocking alleged fraudulent accounting practices employed by Asian companies to defraud the country. At an interactive session by the two bodies in Lagos, Chief Executive of FRC, Jim Obazee, noted that most companies of Asian origin in the country employ false financial statements to evade taxes. He said some of the companies declare losses even when they make profits to avoid relevant taxes, thereby shortchanging the host government. Disclosing FRC's intention to partner relevant agencies to stop such frauds, Obazee charged ICAN to work with external auditors of the affected companies and insist on compliance with professional standards. He also observed that accountants who work with regulatory agencies, such as the Corporate Affairs Commission (CAC) where the companies file reports, could be used to fish out firms that engage in such unlawful acts. "Who are the accountants of Lebanese and Chinese companies? Who sign their accounts? They need to engage local accountants for the purpose of professional practice," he advised. He said the country must pay adequate attention to efficient tax system, which is a cardinal programme of the Council. The FRC boss also noted the need to scrutinise inbound foreign direct investments (FDIs) to ensure that what come into the country are selective and strategic, and align with the country's development agenda. Much as the country wants to grow the economy, it must be courageous enough to turn down exploitative foreign investments, he said. Obazee also charged ICAN to work towards timely review of the Financial Management Laws of states and the Financial Management Act of the Federal Government, saying only Lagos has amended its so far. He said this is important to enable the two tiers of government fully adopt the International Public Sector Accounting Standards (IPSAS) The ICAN President, Mr. Chidi Ajaegbu, agreed that financial dealings of foreign companies deserve closer monitoring but was not optimistic ICAN was in a position to do that. He promised the Institute would work with FRC to enhance professional accounting and development of the International Financial Reporting Standard (IFRS). Copyright The Guardian. Distributed by AllAfrica Global Media (allAfrica.com). |