FRC, SEC urge audit committees to expand capacity development to boost investor confidence

Nigeria’s top financial regulators are warning that weak audit oversight is becoming a growing risk to investor protection, urging audit committee members to strengthen their skills as corporate reporting and governance standards evolve rapidly.

At EY’s maiden Audit Committee Transformation Summit held in Lagos, senior officials from the Financial Reporting Council (FRC) and the Securities and Exchange Commission (SEC) said shifts in technology, heightened regulatory scrutiny, and rising governance failures across sectors mean audit committee members must adapt or risk undermining market confidence.

Rabiu Olowo, chief executive officer of the FRC, said audit committees now sit at the centre of financial integrity at a time when Nigerian companies are dealing with more complex reporting requirements, cyber risks, and disclosures shaped by global sustainability trends.

He said the role has expanded beyond reviewing financial statements to anticipating risks and strengthening institutional trust.

“An audit committee anticipates issues before they occur. More importantly, it embraces continuous improvement, regularly reviewing its effectiveness and evolving with emerging standards,” Olowo said, through Titus Osawe, coordinating director of Corporate Governance, Inspection & Monitoring at the FRC.

“To achieve this high level of performance, it begins with capacity. The right skills and knowledge must be at the table.”

Read also: FRC, SEC call for ethical governance across boards

The remarks come amid increased regulatory interventions following lapses in corporate disclosures across industries, with regulators pushing boards to improve governance quality to attract long-term capital.

SEC director-general Emomotimi Agama said audit committees have become an essential link between boards, management, independent auditors, and regulators, noting that their judgment can determine whether companies maintain transparent reporting systems or expose investors to avoidable risks.

“To all audit committee members here, I urge you to embrace continuous learning and professional development,” Agama said, represented by John Briggs, the Commission’s Lagos zonal head. “The investment you make in enhancing your technical competence, industry knowledge, and governance acumen directly translates into stronger organisations and more resilient markets.”

EY’s regional managing partner, Anthony Oputa, said the summit is part of efforts to prepare audit committees for “fast-evolving” standards, from digital reporting to updates in IFRS and sustainability disclosures, which require boards to rethink how they manage oversight.

Jamiu Olakisan, partner and assurance leader for West Africa at EY, told BusinessDay that the event is designed to help committee members stay ahead of changes in the business environment, adding that discussions are underway to make it an annual engagement.