The nation’s capital market is key to the development of the Nigerian economy, the Chairman, Association of Reporting Accountants in the Capital Market (ARACAM), Mr. Ayodele Othihiwa, has said.
Speaking at the second annual general meeting of the association in Lagos, Othihiwa stressed the need to develop a dynamic capital market that would be able to meet the needs of all categories of companies.
According to him, the lingering effect of the market recession in 2008 has impacted on the long term funding raising activities.
He however expressed optimism that the market would ultimately expand in depth and spread to accommodate capital requirements of big and small and medium companies, thereby creating immense opportunities for participation by all stakeholders.
Othihiwa, who is a partner and head of financial services industry at KPMG, said the relatively lack of depth at the Nigerian capital market has adversely affected the full operations of reporting accountants.
“However, we are hopeful that as the regulatory authorities work on the development of a strong capital market with depth and capacity to provide alternative sources of raising funds, our activities and involvement will begin to expand,” he said.
Othihiwa urged reporting accountants to invest in capacity development by improving their skills and knowledge in order to be in tune with global best practices and developments.
He said with expansion of activities in the capital market, small and medium enterprises would need the services of small and medium-sized accounting firms, thus the need for them to be adequately equipped in terms of skills and resources.
Clarifying the roles of external auditors and reporting accountants, he said while auditors report on the faithfulness of the presentation of transactions and activities of a company, reporting accountants provide several reports to support capital market issues including accountant report, long form report, working capital report, profit forecast, pro-forma opinion, financial reporting procedures comfort letter and significant change comfort letter.