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Monday, October 13, 2014

Corporate Affairs Commission -CAC-to delist 49000 companies over failure to file returns

FOR failing to file their tax returns after the statutory period, the Corporate Affairs Commission (CAC) has stated that it would delist 49,000 registered companies from its register. Indeed, the Commission stated that a large number of registered companies in its database have not fulfilled their statutory regulations in terms of filing of returns while many have refused to state the non-existence of their businesses.
   Specifically, the CAC noted that at least 414,000 companies did not file their returns
in 2010 out of about one million registered businesses in the country, thus necessitating the renewed action set to be taken.
    Special Adviser to the Registrar General, CAC, Garba Abubakar while speaking at a seminar organized by the Professional Practice Group of the Lagos Chamber of Commerce and Industry (LCCI) in Lagos, yesterday, stated that most businesses registered in the country have no proper structure and have defaulted in their incorporation requirements.
    According to him, investigations show that businesses terminate the relationships with their professionals after incorporation while most professionals are found wanting in responsibly advising their clients.
    “We observed that 60 per cent of the cost of starting a business goes to professionals as fees, a condition many small businesses have found not to be sustainable. Also, most companies do not have ascertainable capital base unlike what other sectoral regulators prescribe.
   “To ease the process, CAC decided to address bottlenecks in the system with a new platform. Although we are experiencing some challenges, we hope to address them in due time”.
    President, LCCI, Alhaji Remi Bello emphasized the need for government to create a conducive environment for businesses to thrive. 
  According to him, structuring businesses for effective regulatory compliance is significant because many businesses are having compliance issues with the various regulators that oversee their operations.
   “We are gradually moving towards a growing formal economy where companies would have no choice but to play according to the rules. Businesses built and run in contravention are often not sustainable in the long run.
   “Policy consistency remains a valuable ingredient for a sound regulatory environment. We call for more consultations with the private sector in the formulation of policies and regulations. This will ensure better compliance and consistency irrespective of changes in the leadership of regulatory authorities”, he added.
  Chairman of the Professional Practice Group of the LCCI, Abayomi Adebanjo noted that professionals occupy a key position in the implementation of policies in the country and their role should not be ignored especially in the area of policy implementation.
  According to him, though lofty in its aspirations, the 24 hours duration for the incorporation of businesses is unrealistic considering the various bottlenecks encountered by businesses in the course of registering a business.
    “There is a need for increased stakeholder engagement to aid the implementation of policies. Making declarations on the timeline for business incorporation should be considered alongside other factors as there are other regulators involved in the process. We need structures that are sustainable to engender growth in the country”, he added.

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