By Eromosele Abiodun
Stanbic IBTC Holdings Plc has said that in the running of its business, it will continue to exercise its constitutional rights to seek redress and protection through the legal process and the law courts. The organisation made the clarification in response to the expected publication of its 2015 audited financial statements, for which it is in dispute with the Financial Reporting Council of Nigeria (FRC).
In a letter to the Nigerian Stock Exchange (NSE) dated May 27, 2016, the bank said it was imperative to bring all stakeholders up to date on why the issuance of its 2015 financial statement is being delayed.
The bank explained that on 24 March 2016, it informed NSE, shareholders and other stakeholders about the reporting challenges it was experiencing with FRC regarding its 2015 financial statements, which subsequently led to the engagement of its external auditors on the appropriate presentation of certain items in its financial statements, which are the subject of ongoing legal proceedings.
Stanbic IBTC had instituted an appeal at the Lagos Division of the Court of Appeal following allegations of mis-representation of its financial report, over which FRC had announced a regime of sanctions against Stanbic IBTC Holdings, including a fine of N1billion.
The bank noted that in order to ensure the timely finalisation of its 2015 audited financial statements, it obtained the approval of the NSE to delay the filing of its 2015 audited financial statements on 24 March 2016, while the Securities and Exchange Commission (SEC) applied the regulatory sanction for late filing of financial statements by a listed entity.
“However, the challenges with the FRC continued, as the regulatory agency continued to place hurdles in the way of fair and quick resolution of the issues. For instance, on 15 March 2016, FRC published on its website undated new rules which the agency said applied with immediate effect. In essence, the new rules would apply to all financial statements that had not been finalised as at 15 March 2016.
“Stanbic IBTC Holdings PLC has prepared its 31 December 2015 financial statements in compliance with the undated new FRC rules published on 15 March 2016 and all extant accounting standards. KPMG has however indicated that they will not be able to express an audit opinion in respect of the financial statements given the stance taken by the FRC on this issue, ”the bank said.
The company added that it considers the position taken by the FRC with respect to the injunction and its 2015 financial statements as erroneous and unfortunate and has alerted the Central Bank of Nigeria (CBN), its primary statutory regulator, as well as the Minister of Industry, Trade and Investment to the challenges posed by the FRC.
Even more troubling, according to Stanbic IBTC, is that FRC has informed it that it will not comply with the court orders or engage constructively with Stanbic IBTC “unless and until there is a non-appealable decision of a court of competent jurisdiction. It is pertinent to mention that only decisions of the Supreme Court of Nigeria are non-appealable.”
While reiterating that it remains well-capitalised, liquid and continues to operate profitably, Stanbic IBTC said it will continue to engage with the CBN and its solicitors, Fidelis Oditah & Co, and to comply fully with all extant laws and regulations applicable to the conduct of its business.