By Gboyega Akinsanmi, 08.02.2010

The Nigerian Stock Exchan-ge (NSE) yesterday de-clared that it is not insolvent and  is prudent in the management of its resources, contrary to allegations made in a petition by President, Dangote Group, Alhaji Aliko Dangote, to the Securities and Exchange (SEC).

 

NSE’s spokesman, Mr. Sola Oni, said in a statement that the Exchange received a letter from SEC with regards to the petition by Dangote, explaining that the NSE replied within 12 hours since there were ready answers and documents to back up their position.

 

Speaking on the allegation of insolvency, Oni said the organisation is meeting all its obligations as and when due.“The staff are not owed salaries and allowances.  The retirees receive their cheques promptly.  The Exchange does not owe any bank or individual.  If there is any form of owing it could be that such a company is handling  project that has not been completed.  Even at that, The Exchange must have made some pre-payment,” he said.

 

Oni  said that as  part of its oversight functions, SEC  had sometime last year and early this year conducted a special and comprehensive  audit of the Exchange.According to him, the audit was done by the commission’s internal auditors and external consultants and the  auditors did not query the Exchange in any form.

 

On the presentation of accounts, he said that as far back as early March this year, the Exchange’s Council had approved the draft accounts as preparatory to Statutory Audit.  Already, the auditors, Messrs Akintola Williams Deloitte have concluded the audit and their report is a matter of days, he explained.

Oni said that NSE usually publishes its  accounts around August before the Annual General Meeting and always send the audited accounts to African Securities Exchanges Association (ASEA) World Federation of Exchanges (WFE) and other international organisations.

Besides, he explained, the 2009 account was not queried by the auditors, saying: “We must also appreciate that the accounts of The Exchange is the final responsibility of the President and other Council Members and not the management.  The Council scrutinises the Management Account, approves it and lay the Account before The Exchange’s members at the Annual General Meeting. In, essence, all the previous accounts were scrutinised and approved by the Council before the Annual General Meetings. This is the due process.”

On the alleged N42 billion income, Oni said that the figure is misleading, explaining that as a corporate citizen, The Exchange granted heavy discounts to banks during the consolidation programme.

 

“Also, there had been several instances when the Exchange simply charged nominal values against its actual commission.  Unfortunately, some people simply calculate the Exchange’s fee based on the standard commission whenever companies come to raise capital. That is why anybody cannot just assume that The Exchange charges its commission on the strength of the value of money to be raised by a prospective company. The said income is less than 42 billion anyway,” Oni said.He added that NSE has been remitting its pension on monthly basis and it is being managed by NLPC Pension Fund Administrators Limited.

“Our pension cost increased because we had to backdate it by 20 years when we commenced. Otherwise those who had worked for The Exchange for several years would be left in the cold. The decision posed some challenges at the initial stage because we needed a huge capital to back up the scheme.  We are now on course. This is a matter of being fair to them.  But everything we did on the pension was approved by the Council. We have no problem with our pension managers,” he said.

Justifying the use of committees, the NSE image maker said that the capital market cannot be shut down because of the court cases.