The Nigerian Stock Exchange (NSE) has sanctioned Flour Mills of Nigeria Plc, Universal Insurance Plc, and four others with fines totalling N9.2 million over late filing of their financial statement.
The Exchange, in its latest X-Compliance report revealed that the sanctions were applied in accordance with the rules for filing of accounts and treatment of default filing, rulebook of the Exchange (Issuers’ rules).
The other companies were Grief Nigeria Plc, Afromedia Plc, Conoil Plc and Lasaco Assurance Plc.
According to data obtained by Nigerian NewsDirect showed that Universal Insurance got the highest fine of N5 million, while Lasaco Assurance was slammed with a fine of N1.4 million.
This also showed that out of the companies that were fined under the period review, the two insurance companies fine amounted to N6.4 million, 69.57 per cent of the total fines.
Universal Insurance was fined for failing to file its audited financial statement for 2018, the first quarter of 2019 and six months of 2019, as Lasaco Assurance was penalised for failing to file its audited financial statements for 2018, and first quarter of 2019.
Flour Mills of Nigeria followed suit with a fine of N1.2 million for late submission of its audited financial statements for the year ended March 31, 2019.
However, Grief Nigeria, Afromedia and Conoil were fined N800,000, N400,000, and N400,000 respectively for late submission of their full year 2018 financial statements.
Under the new rules, late submission attracts a fine of N100, 000 daily for the first 90 calendar days, another N200,000 per day for the next 90 calendar days and a fine of N400,000 per day thereafter until the date of submission.
NSE in its report, noted that the initiative was designed to maintain market integrity and protect the investors by providing compliance-related information on all listed companies.
According to the report, “Companies that are listed on the Exchange are required to adhere to high disclosure standards, which are prescribed in Appendix 111 of the listing rules. Financial information, which is periodic disclosure and on-going material events disclosure, should be released to the Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market.”
The bourse requires quoted companies to file their unaudited quarterly accounts not later than 30 calendar days after the relevant quarter.
The account should also be published within five business days after the date of filing in at least two national daily newspapers, and post it on the company’s website, with the web address disclosed in the newspaper publication.
Recently, NSE placed a suspension on Universal Insurance, Lasaco Assurance and Conoil in different times in 2019 which led to the huge amount of accumulated fines.
According to the rules for filing of accounts and treatment of default filing and the rulebook of the exchange (issuers’ rules), if an issuer fails to file the relevant accounts by the expiration of the cure period, the Exchange will send to the issuer a ‘second filing deficiency notification’ within two business days after the end of the cure period.
The rules also added that trading in the issuer’s securities would be suspended and the Securities and Exchange Commission and the market would be notified within 24 hours of the suspension.