9 May 2013

Nigeria: Why We De-Register Companies - CAC

The Corporate Affairs Commission, CAC, yesterday, said its decision to delist companies from its register was borne out of the desire to rid the country of inactive and portfolio companies.

Speaking at the 2013 Practice day of the Institute of Chartered Secretaries and Administrators of Nigeria, ICSAN, in Lagos, Mr. Ibrahim Maikwata, Manager, CAC, disclosed that a number of the companies on its register are inactive, with their directors either dead or untraceable.

He said, "we delisted companies because we want to do away with inactive companies on our register. For example, some companies' directors are dead while the companies are inactive."

The CAC had within the last couple of years, delisted about 450,000 companies, for various offences, ranging from non-filing and irregular filing of annual return among others.

Continuing, Maikwata stated that the commission was committed to the enforcement of the rules on filings for trustees, such as church, mosques, and charitable organizations among others.

According to him, the Company and Allied Matters Act, CAMA, requires that organisations designated as trustees appoint qualified auditors to audit their accounts, while they were also required to prepare statement of accounts while filing in their annual returns to the CAC.

"In addition to appointing an internal auditor, trustees are expected to appoint an external auditor. The Auditor should be appointed by the general meeting and not by the general overseer as the case may be," he noted.

Also speaking, Mrs. Oyindamola Ehiwere, a chartered secretary and administrator, blamed the delay in the filing of document by companies on the bureaucracy of the regulators which has made it impossible for company's secretaries to meet up with deadlines.

According to her, inflexibility of the regulators on issues as the market continues to evolve, adding that lack of understanding from the regulators on issues which require them to be less rigid has contributed in frustrating the efforts of chartered secretaries in the discharge of their duties.

She maintained that some of the major challenges facing chartered secretaries were the CAC's inefficiencies and poor record keeping function.

He added, "Other challenges are the change of requirements and procedures by the CAC without educating the users of its services; arbitrary application of regulations, such as the filing of Form CAC 2 with share transfer documents."

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