Failure to manage risk is recipe for corporate failure – Former NPRA Boss

Former CEO of the National Pensions Regulatory Authority (NPRA), Dr. Daniel Seddoh has said failure to identify and manage risks is mainly the cause of corporate failures in the country.

Speaking on the topic ‘Corporate failures in Ghana: the roles of auditors and accountants’ at the quarterly public lecture series of the Institute of Chartered Accountants, Dr. Seddoh underscored the importance of market research in preventing corporate failures.

“When market research is relegated to the background and advices from family and friends is rather adhered to, it may have deadly consequences on corporate organizations. In all this the accountant and the auditor must give the best advice, even if it puts their positions on the line” he said.

Dr. Seddoh, therefore, urged the leadership of corporate institutions to invest in the improvement of their Management Accounting skills, while urging ICAG to build the research capacity of their students to equip them with the skills to serve organizations professionally.

Organizations, he explained, exist to protect shareholder values and interests with any deviation from that which could result in corporate failure, adding, “There is therefore, the need to recommend experienced accountants to Boards”.

Dr. Seddoh noted that failure to publish audit reports and auditors readiness to give clean bills of health to organizations without actually examining the books and the circumvention of internal controls were abuses of the governance structures which could impact negatively on the organization.

He urged accountants not to support the undermining of boards or compromise the quality of their work.

ICAG’s Vice President, Dr. William Atulik, urged Accountants and Auditors to keep adequate records and reliable information for vital decision-making.

Dr. Atulik urged them resolve to be independent and show integrity in their work as professionals in order to erase the perception that Accountants were fraudulent.

The lectures were instituted by ICAG to provide a forum for the critical examination of some topical issues emanating from public discourse in order to provide the platform for the Institute to present is views and make recommendations on national policies.