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Account default: NSE slams N46.1m fine on African Alliance

…Records N-21bn negative reserve

Maduka Nweke

For not living up to the listing requirements of the Nigerian Stock Exchange (NSE) rules of accounts submission, African Alliance Plc, one of the underwriting firms in the country has been fined N46.1 million by the Nigerian bourse. The report which was sourced from NSE 2018 X-Compliance that totaled N46.1 million was for late submission of its 2015 and 2016 audited accounts.

According to the report, the huge fines and management expenses have, however, affected the reserves of the company as it recorded N1.49 billion management expenses and negative reserves of -N21.05 billion in its 2016 financial account.

Analysts believe that with the negative reserves, the company may not be able to meet most of its responsibilities especially prompt claims payment as a lot of exigencies will be chasing few cash from the company.

The Nigerian bourse complained that the company filed its audited and interim financial statements after the regulatory due date, stating that the Exchange applied sanctions in accordance with the Rules for Filing of Accounts and Treatment of Default Filing under the Rulebook of The Exchange. 

The NSE described the company as a delinquent filer of audited accounts as it fell short of the minimum listing standards in terms of timely disclosure of its audited annual financial performance and has Missed Regulatory Fillings (MRF) or Awaiting Regulatory Approval (AWR) of their primary regulators which is NAICOM.

Indicationa from the shareholders of the company reflect displeasure at the way the company is being run with some of the shareholders positing that instead of rewarding shareholders who have stood by it during the trying times, the insurance company was busy paying millions of fines to regulatory bodies.

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