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Religious bodies, NGOs must pay tax for trading subsidiaries – FRC

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By Lazarus IBEABUCHI
 Contrary to agitations that religious bodies should be exempted from taxation, the Financial Reporting Council said that religious bodies and not-for-profit organizations are liable to pay tax for their trading subsidiaries only.
A trading subsidiary is a profit making venture established by a not-for-profit organization to meet obligations other than what is written in its Memorandum of Association as filed with Company and Allied Commission, CAC.
Speaking during its presentation of Statement of Accounting Standard, SAS 32 by not-for-profit organizations, Mr. Obazee Osayande, the Executive Secretary and Chief Executive Officer of the Council disclosed that not-for-profit organizations are expected to key in into the International Financial Reporting Standard, IFRS by January 2013 with a view to ensuring uniformity in the disclosure of accounts for easy accessibility.
 He said, “It had been noticed that a number of entities operating on commercial lines, with charity, are claiming exemption on their income on the ground that the totality of the outfits are charitable institutions. The Company and Allied Matters Act, CAMA, provided that you either register as a public limited by guarantee or limited by share. Section 373 of CAMA provides that you prepare account and file report with the Corporate Affairs Commission.
“Non- profit organizations are registered as limited guarantee and they do not declare profit. They source their funds from the public, government institutions, etc. They are not profit oriented. In the course of rendering their services, they might have income shortfall and as such, engage in petty businesses to enable them generate more fund. Such money is not taxable. But some actually engage in businesses – we call them trading subsidiaries. The trading subsidiaries have to be registered as a full business entity. Such business is taxable.
“For instance, donations and contributions to a church are not taxable. If the church collects the contribution, it is expected that it is used to meet the objectives written in its Memorandum of Association as filed with CAC.  Notwithstanding, if the church collects the money and invests it in a venture in furtherance of its objectives, it is not taxable.
“But if the church invests in a trading subsidiary that has no relevance to its stated objectives, government will treat the trading subsidiary as a trading entity. The income of these business subsidiaries is subject to income tax and should be rightly so reported, accounted and disclosed. The organization can then bring in its inflow to support its objectives. This is the practice in the United Kingdom, Singapore and other developed economies.”
In furtherance to ensuring a transparent and accountable financial statement, Mr Osayande said the SAS 32 contains a set of illustrative financial statements to aid preparers in the application of the Standard, adding that if the standard is correctly applied by preparers of financial statements of Not for profit organizations, it will enhance transparency, accountability and credibility of information presented by not-for-profit entities, as well as lead to increase funding by donors who believe in the objectives of such entities.
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Banking

Millions of customers still stranded worldwide 24 hours after GT Bank online operations suffered attacks

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GTCO Acquires Funds Management, Pension Firms

By Yemie ADEOYE

GT Bank, one of Nigeria’s leading banks, with operations across Africa and the United kingdom, and with an asset base of about US$3.11 trillion is under a cyber attack which has left millions of its customers across the world stranded in the last 24 hours.

The bank which was renowned for its seamless online operations at inception has suffered dwindling online efficiency in recent years and this current attack didn’t come as a surprise to many of its numerous customers. However, it is becoming worrisome that over 24 hours after its online operations went down, the bank has not been able to arrest the situation and restore its online services.

Stranded GT Bank customers outside the banks premises

Several customers of the bank took to their X (formerly known as twitter) handles to express their frustrations at the bank, as several of the customers in the diaspora are unable to access their accounts and carry on with their transactions.  A customer , Jeff55 who lamented on his X handle about the development, stated that it is a thing of shock that a bank of this size couldn’t afford to have the necessary tools and experts to ensure a full protection of its online operations in this age and time.

Another customer Dimma stated that while Cybersecurity training may seem tedious, the recent #GTBank hack is a stark reminder that everyone is just a click away from a devastating attack.

Several media organisations had reported that hackers have stolen GT Bank website, and intercepted customers Data in massive phishing operation.

At the time of filing this report, Biztellers.com.ng checks on the banks website shows that it is still down and unaccessible, and neither GT Bank media and communications unit nor any of its agencies or surrogates have commented officially on the development.

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Banking

Tinubu commends increased crude production to 1.61 mbpd

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Says output surge buoyed by reforms he announced in May 2024 to address gaps in PIA

President Bola Ahmed Tinubu on Sunday declared a resurgence in the oil & gas industry, commending the increased crude production to 1.6 million barrels per day.

The president, who said this in a national broadcast, maintained that the resurgence was buoyed by the reforms he announced in May 2024 to address the gaps in the Petroleum Industry Act (PIA).

Nigeria’s crude oil output got a boost to 1.61 million barrels per day in July 2024 through the president’s directive and the industry leadership provided by the Nigerian National Petroleum Company Limited (NNPCL).

Acknowledging what he called a resurgence of the once-declining oil and gas industry in his Sunday-morning broadcast to the nation, President Tinubu said that oil investors are coming back to Nigeria.

He said; “Our once-declining oil and gas industry is experiencing a resurgence on the back of the reforms I announced in May 2024 to address the gaps in the Petroleum Industry Act. Last month, we increased our oil production to 1.61 million barrels per day, and our gas assets are receiving the attention they deserve. Investors are coming back, and we have already seen two Foreign Direct Investments signed of over half a billion dollars since then.

Read Also : BREAKING: Sell Crude To Dangote Refinery In Naira – Tinubu To NNPC LtdRead Also : BREAKING: Sell Crude To Dangote Refinery In Naira – Tinubu To NNPC Ltd

“Fellow Nigerians, we are a country blessed with both oil and gas resources, but we met a country that had been dependent solely on oil-based petrol, neglecting its gas resources to power the economy.

We were also using our hard-earned foreign exchange to pay for and subsidise its use. To address this, we immediately launched our Compressed Natural Gas Initiative (CNG) to power our transportation economy and bring costs down.

This will save over two trillion Naira a month, being used to import PMS and AGO and free up our resources for more investment in healthcare and education.

“To this end, we will be distributing a million kits of extremely low or no cost to commercial vehicles that transport people and goods and who currently consume 80% of the imported PMS and AGO.

“We have started the distribution of conversion kits and the setting up of conversion centres across the country in conjunction with the private sector. We believe that this CNG initiative will reduce transportation costs by approximately 60 per cent and help to curb inflation.”

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Banking

FBN Holdings On Course For AGM

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Plans are in top gear for the 11th Annual General Meeting (AGM) of the FBN Holdings Plc.

The management made this disclosure in a notice it filed with the Nigerian Exchange Limited (NGX) on Thursday, where it averred that it has not been served with any court order against the proposed AGM.

According to notice, which was signed by the acting Company Secretary, Adewale Arogundade, FBN Holding said, “The attention of FBN Holdings Plc (the Company) has been drawn to recent media reports purporting that the Company has received a Court Order stopping it from holding the Annual General Meeting (AGM) scheduled for August 15, 2023.

“We confirm that this assertion is a false narrative as the Company has, as at the date hereof, not been served with any court order to stop the forthcoming AGM.

“Suffice to mention that the AGM is a statutory meeting of Shareholders that must be held in accordance with the law, further to which the Company will notify the regulators and the public as appropriate if there is any lawful order to restrain the Company from conducting same.

“We hereby assure our esteemed Shareholders that the AGM shall hold on August 15, 2023, as planned and we look forward to their attendance and active participation at the meeting.”

However, court orders published in national dailies showed that the Federal High Court in Lagos had issued an order against the financial institution, barring it from holding its 11th AGM.

The order was entered pursuant to a petition by Olusegun Onagoruwa, in suit No: FHC/L/CP/1271/2022. It was addressed to the bank and some other bank officials.

It read, “Take notice that unless you obey the directives in the judicial order contained in the order made on July 15, 2022, by the Federal High Court, Lagos, by refraining from proceeding with the 11th Annual General Meeting of FBN Holdings Limited proposed for August 15, 2023, from seeking approval to issue or raise share capital in any manner whatsoever, from appointing or confirming the appointment of new directors, or in any other manner taking any step towards implementing, actualising enforcing resolution of the 10th Annual General Meeting of FBN Holdings Plc held on June 20, 2022, or in any other manner overreaching, disobeying or undermining the said order of a court, you will be guilty of contempt of court and you will be liable to be committed to prison and to there imprisoned.”

Biztellers brought you a report that a segment of shareholders had staged a protest at the headquarters of the bank on Monday, calling for the AGM to be held, as well as soliciting regulatory interventions.

It is expected that at the AGM, FHN Holdings is poised to breathe life into plans to seek shareholders’ approval to raise N150bn fresh capital via a rights issue and elect new directors including billionaire, Femi Otedola and Samson Ariyibi among other resolutions.

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