|Babs Ajayi||Thursday, December 14, 2006|
Toronto, Ontario, Canada
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CADBURY: NIGERIA'S ENRON
adbury Nigeria sacked its Managing Director, Mr. Bunmi Oni and Mr. Ayo Akadiri, the company's Finance Director recently, which is a fallout of the financial book padding scandal and corruption that recently rocked the company, and that is the way it should be. The bold actions of the Board of Directors led by Dr. Uduimo Itsueli should be commended. The Board recently commissioned the firm of PricewaterhouseCoopers to review and investigate the company's financials. The outcome of the investigation "has confirmed a deliberate overstatement of the company's financial position over a number of years to the tune of between N13 and N15 billion"! This is Nigeria's version of the Enron Corporation scandal in the United States.
Cadbury Nigeria will now adjust it accounts to reflect an operating loss of between N1 and N2 billion. The company's Public Affairs Manager, Mr. Kufre Ekanem told newsmen that, "Over the number of years, Cadbury Nigeria had assigned itself an ambitious growth target. To achieve these targets, several systems abuses occurred. The overstatements are directly traceable to those systems abuses." Mr. Ekanem referred to "deliberate breaches of our accounting systems and controls," and cooking up numbers became an obsession and the central focus of maintaining a mirage. A visit to the website of Cadbury Nigeria, http://www.cadburynigeria.com/news.php will shed more light on these acts of dishonesty and crooked self-helps.
It is a shame that Messrs. Oni and Akadiri will end their long years of service at Cadbury in disgrace with their reputation in tatters. Both men should be in the custody of the Economic and Financial Crimes Commission (EFCC) to explain their roles in the overstatement of accounts and the deliberate manipulation of finances at Cadbury. Enron corporation founder, Kenneth Lay was convicted on all six counts of fraud and conspiracy while Enron Chief Executive Jeffrey Skilling was found guilty on 19 of the 28 charges brought against him. Mr. Skilling will serve a 24-year sentence on fraud and conspiracy charges. The case of Messrs. Bunmi Oni and Ayo Akadiri should not be different, and the EFCC should not fail in its duty to protect investors and serve a warning to corporate looters and crooks still in several companies in Nigeria.
Several accounts in Cadbury Nigeria are coded so well and there are many headings that meant far more than they ordinarily present at casual look. Many Cadbury staff confirmed the existence of a mafia headed by a former Chief Executive holding on to the company, and only this former executive's sidekicks cum anointed candidates have risen to executive cadres in more than 15 years. The average Nigerian company and banks are run like this. In such an environment honest, hardworking and straightforward folks have no place; they are hounded, sidelined and eventually pushed out. There were several such cases at many of the now defunct new generation and the not-so-new generation banks and manufacturing companies.
Corporate governance and responsibility has been sacrificed at the altar of nepotism and corruption. It is no news to declare that more than 60% of the current banks in Nigeria today are padded up and their financial statements heavily suspect. Many of them are not worth placing funds with and their leaderships continue to carry on business as usual. The era of forex magic and round tripping may not be over yet at these banks. It was forex that provided opportunities to many crooks in Nigerian banks some years' back to steal and loot. Many of such crooks are scattered around Europe and North America with their loot, not anxious to return to Nigeria anytime soon. They have for company those one-room apartment finance house magicians who promised unimaginable returns on investment to unwary and sometimes greedy people only to run away and leave their victims in tears.
Many medical doctors and professors met their untimely death at the hands of these lowlifes who took their money and gave nothing back in return - no interest, no deposit, nothing. After several years of medical labour and hardwork, the doctors returned from Saudi Arabia and placed their hard earned money in these Finance Companies. But when the bubble busted and the funds juggling could no longer be maintained any longer, the finance house wizards made for Europe and America, their loots in tow.
Cadbury Nigeria must come clean and take every step necessary to clean up the books in the interest of its shareholders, good corporate responsibility, and integrity; once touted by Mr. Bunmi Oni as a cornerstone of the firm's way of doing business.
Another similar case to Cadbury's is that of Afribank Nigeria Plc. Afribank's financial statement woes and accusation by its former Managing Director that the Board of Directors colluded with its auditors to cook the books came more than a month before Cadbury's, but while Cadbury took quick and necessary steps to put the records straight, Afribank is still at work. We wonder what is delaying the review and what the Central Bank of Nigeria is doing to ensure that nothing but the true position of Afribank's accounts is produced and presented to the shareholders. The presentation should not be delayed a day longer than necessary.
There is an urgent need for Cadbury Nigeria to review its management practices and the way things are done, its corporate culture, its values and responsibility to the public and its shareholders. Companies are dwindling in Nigeria as many fold up and go under on the heels of blatant looting and stealing by executives, and most of these executives are not bothered or troubled by where their children, grandchildren and the youths of Nigeria will find employment.