Though inflation rate has continued to drop in the past 14 months, it is still high at 11.14 per cent. Institute of Chartered Accountants of Nigeria (ICAN) President Razak Jaiyeola believes the government must work harder to tame it. He told Charles Okonji in Lagos that members of the institute working in organisations which do not remit workers’tax are now obliged to report to the Inland Revenue.
What is your take on accounting regulation in Nigeria?
The Institute of Chartered Accountants of Nigeria (ICAN) came into being by the Act of Parliament in 1965. We are empowered by that Act to regulate the standard of accountants in the country. So, that is how we started establishing standards for the regulation of accounting. For this reason, we introduced a syllabus which we review from time to time. We also embarked on regular training for accountants, and we call it Mandatory Continuing Professional Education (MCPE). We recently reviewed the Code of Ethics of members whereby they are expected to comply with a law that mandates members to disclose any organisation where they are working or where they are acting as external or internal auditors cutting corners to relevant authorities. We have introduced whistle blowers policy for them to alert the relevant authorities about the shortfalls of those organisations that are not living up to their responsibilities, and the institute will support them, when they run into trouble. Members of our institute came together to form the International Federation of Accountants (IFA), which today consist of three million chartered accountants all over the world, and we have representation in such body. We have over 45,000 accountants in Nigeria, and over 150,000 students. We also have about 20,000 accounting technicians, which are also called junior accountants, and they have over 250,000 students.
What is your position on strict enforcement of standards in the accounting profession?
We have Professional Practice Monitoring Committee, which the council has set up. Members of the committee pay monitoring visits to organisations and they write reports to council to tell us how the members are faring in the professional practice. They go there with the programme of what to look for, standard of employees, the type of working programmes they are using, the kind of training the staff are subjected to, because there is minimum requirement for every member, every year. Mandatorily, it is expected to preserve credit hours. We also look at the ethical standards. Recently, the institute bought into “NUCLAR” programme, which encourages our members to disclose any un-ethical behaviour by some organisations. For instance, if an organisation defaults in paying or remitting deductions from employees salary to the appropriate authorities over time, the accountant in such organisation is expected to report to such management that it is against government regulations. If they don’t do the right thing after the caution by remitting the deductions from employees’ salaries into government account, then our member would report to the relevant government authorities about such happenings, and make a report to them. But it is the business of relevant government authorities to take up the case. For instance, it is the business of Lagos State tax office to charge any of the defaulting companies within Lagos to court for prosecution.
Do you prosecute erring members? If yes, how many have you prosecuted recently?
As regard ethical behaviour, any of our member that is found wanting in whatever form, we expect the public to make a report to us. First, we would arraign such member to face an investigation panel, which will subject the member to interrogation, and when found guilty, would be taken to the tribunal, thereafter, appropriate measures would be taken against such a person. So, our members know that they are not free to behave anyhow. That is the way that we enforce standards in the profession. Every year, we always have cases that we treat and once a judgement is given, it is published on the dailies. They have not been too many of recent, because our members know that the tribunal is up and doing. At the tribunal, we ensure that we are very fair to all, without perversion of justice.
Are you satisfied with the managment of the economy, especially its debt management strategy?
First, the country must curtail its appetite for imported goods, diversify revenue sources, revive Ajaokuta Steel Mill, and tighten security measures, while the ease of doing business project must be continued with vigour. In every budget, the government sets aside a certain amount to repay what it owes. Today, what the country earn is not enough to service recurrent expenditure, capital expenditure, and to pay debt. So, we are running at deficit. If we take a look at our infrastructural deficit, we find out that it is huge. At the moment, the government spends about 30 per cent of its revenue to service debt. It is not an easy thing to do. So, for the government to take us out of this problem, firstly, there are lots of assets lying idle all over the places. What exactly is Dodan Barracks doing at Ikoyi, a prime location? Look at the barracks in Maryland, the Ikoyi Prison, and the Federal Government Secretariat, all at prime locations, lying idle and wasting. They should sell them off, move the barracks away from prime locations. This is not done anywhere in the world, that the government would just be tying down resources. We have a lot of money in the economy that is wasting and we are talking about diversifying the economy. Look at Ajaokuta Steel Mill idling away. All these assets are the things that we should pay attention to. We have the Economic Recovery Growth Plan (ERGP) document which we should implement it faithfully. What about the ease of doing business? We still have a lot to learn and to improve on. Diversifying into agric means that we are diversifying our sources of revenue, we have been diversifying for years, but are they effective? We should be thinking of diversifying our sources of revenue to bring in forex, which is very important. A lot of us will say that Nigeria is very rich in oil. Look at the volume of oil we generate compared to Saudi Arabia, so we cannot say we are rich.
The rate at which Nigeria population is growing is alarming. Around 1960, Nigeria’s population was 42 million, and UK’s population was 56 million, but by 2015, UK was 62 million and Nigeria is over 180 million, and by 2070, Nigeria would be about 550 million, and UK would still be under 80 million. What is mind boggling is that Nigeria’s population is growing at five million per annum and we are not doing anything about it. The problem is that now, we have over 180 million people sharing the amount of resources or revenue we shared 10 years ago. So, these are issues that we should confront squarely as a nation. We have to control inflation, we have to control price, and we have to manage our oil production. These are key areas that we should seriously looked into. As an institute, we are having stakeholders’ forum, where we would tackle the issue of corporate governance, we will tackle issues of tax policy of this country, how we can make contributions to the government. In the next stakeholder’s forum, we are going to handle the economy; we are going to tackle the global economic outlook, the regional, and the cyclical changes that take place. We are going to create awareness within our members, to drive home to them the indicators that are guiding this economy. We would pay a visit to the President, and the Minister of Finance along with all other stakeholders. We are developing a stakeholder’s package, such that within the next few months, you will see our institute coming frontally in advocacy, just like we used to have in those days.
How would you describe the ongoing anti-graft war in the country?
People believe, and I also believe till tomorrow that President Buhari is not a corrupt politician; he has tried using the instrumentality of the Economic and Financial Crimes Commission (EFCC), Indpendent Corrupt Practices and Other Offences Related Commission (ICPC), Directorate of State Security (DSS), Police and so on. But the level is far below our expectation. He tried to deal with the corrupt judges, though we didn’t record much success, but he has sent some signals that people should sit-up, and we have seen changes. Secondly, the introduction of special courts to try cases and to accelerate judgement is a good step in the right direction. He also tried to put in place, systems to avoid delays; he introduced a system for voluntary declaration of assets, and the government introduced some investigative techniques in order to get judgement. That is where the forensic department of ICAN would collaborate with government to ensure that we try as much as possible to give skills to the government agencies. We are going to train them on technology-assisted investigative skills to make sure that they are able to deliver on both the whistle blowing efforts of the government. There are other areas that are yielding dividends, the government should keep it up and make sure that they are very sustainable. The government should keep faith with the remuneration of people that blow whistle. With all these steps, we do hope that things would continue to take shape.
Though the economy is said to be out of recession but not out of the woods, how did the country get into this mess?
The real genesis of recession is our uncontrollable appetite for importation. The things that we cannot produce are what we like. When you look at our roads, what you see is Honda, Toyota, Nissan, Mercedes Benz, and all sorts of imported vehicles, and other items. Efforts by government to import Completely Knocked Down (CKD) vehicles are not intensified, except Innoson. What is the big deal? Look at our phones, everything is being imported. One of the most worrisome is the reckless import of apple. Look at rice. Today, rice import is no more, this is because there is a serious enforcement on rice policy, and in a few years from now, we would be earning forex on rice export. And that is the way to go. The government should diversify our economy into agric, solid minerals mining and value chain development, and into local sources of revenue.
To what extent do your members in the financial institutions use local software?
The issue of Local Content is very necessary to us, not only with respect to bankers, but to all technology consumers. The Nigerian Information Technology Development Agency (NITDA) is an agency of government that is supposed to enforce it, but we found out that those banks and government agencies, even the Central Bank of Nigeria (CBN) and other agencies of government prefer to use imported software. But thank God that the ‘Executive Order 5’ has addressed this problem, mandating that local technologies must be patronised and accorded preference. So, we expect the government to enforce Local Content. We have this local content in the oil and gas industry. There is the Nigeria Content Act and there is an arm of government that is enforcing the law in the industry.
We are going to collaborate with the Institute of Software Practitioners of Nigeria (ISPON) to fight the violation of Local Content in the software use. This is an area that we are very much interested in, and by so doing, this will lead to creating more employments, and before you know it, we will start exporting software.
What are your plans for ICAN?
ICAN is carrying out an in-house upgrade of members that will usher in the dream accountants of tomorrow capable of competing anywhere in the world.
ICAN is targeting at producing digital accountants in every sense of the word by making members embrace Information Technology (IT) and the opportunities that go with it. I see our members participating actively as world acclaimed digital accountants with the review of ICAN syllabus in this direction.
Our intention is to see ICAN taking over the whole of Africa. There are lots of opportunities out there, and once we embrace IT. Within the next few weeks, we would be deploying tele-conference, and through that, we would be bringing down the cost of holding meetings such that people that have to travel from all over the places for the purpose of attending meetings would no longer do so. We are going to collaborate withAhmadu Bello University Business School. We would bring international speakers through the telecoms, thereby bringing the resources that were not ordinarily available. Capacities that are lying idle over there, and cutting-edge services
I see our members practising with key accounting professional bodies in the world, we have signed agreement with England and Wales, and within the next few weeks, we will call all our members. We have reviewed our syllabus such that no other accounting professional body in the world would be a threat to us.
The post ‘Fed Govt must tame spiralling inflation’ appeared first on The Nation Nigeria.