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Privatisation: Auditing firms lobby for jobs

by Business News Report

Auditing firms across the country are now seriously lobbying for the accounting jobs with firms about to be privatised by the Federal Government.
Investigations by The Republic showed that quite a sizable number of these companies to be privatised have no external auditors and their accounts are not up to date to meet the standard for share valuation by the Securities and Exchange Commission.

The accounting firms especially the younger ones, The Republic investigation further revealed now throw parties and invite directors of the affected companies in the order to discuss job possibilities with them.
Some are said to send close associates of such directors to them. But authoritative sources close to the Institute of Chartered Accountant of Nigeria (ICAN), said it is illegal and against professional ethics of the accounting profession for public auditors to solicit for auditing jobs.
According to the ICAN sources, is a standing list of practising auditing firms in the country that is made available to companies for them to make an independent choice of auditors.
The ICAN sources revealed that if a firm lobbies for auditing jobs the possibility of the firm being objective and fair in its audit reports is not there. Such audit report, the source said is most likely to be biased in favour of the company.
According to The Republic investigation there is no fixed audit fees payable to firms. What auditing firms get for their jobs depends on the time spent and the nature of the job involved.
According to the company act of 1969, th board of directors are authorised and empowered through annual general meetings to appoint auditors. The number of auditors depend on the internal arrangement of the company.
Most of the companies to be privitised, The Republic found out are putting things together to prepare five years audited account of their companies in order to meet the Securities and Exchanging Commission, requirements, which is vested with he power of evaluating the worth of a company’s share value in the capital market.
Among other requirements of the Securities and Exchange Commission, which the companies are battling to meet include submission of copies of Memorandum and Articles of Association (which most also not have), brief history and current operations of the company, names of shareholders holding five per cent or more of the paid up capital, prospectuses and changes in activities, shareholdings and other relevant information.
The Republic gathered that government will soon make pronouncement on the modality for privatisng the 49 companies that will go for full privatisation and 20 others that will be partially privatised which was reported exclusively by The Republic on its front page on December 21 last year.
As a result of the 69 companies are busy putting their houses in order.
Industries sources disclosed that quite a lot of money will be spent by these companies in updating their accounts as auditing firms are known to charge fees according to time spent with their clients.

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