Speaking at the opening session of the workshop heralding the collaborative efforts, the commission’s administrator, Mallam Imamuddeen Talba, said the accounting standards were critical to the attainment of uniform accounting standards for the industry.
He explained that the emerging power industry did not have standard reporting procedures because of the diverse backgrounds of the operators in the now liberalized power industry.
According to him, “While the 18 offshoot companies of the Power Holding Company of Nigeria (PHCN) are coming from public sector background, the newly licensed Independent Power Producers (IPPs) are guided by private sector accounting processes and reporting framework, while the legacy IPPs are bringing multinational corporate background.
“There is high tendency for different accounting practices and financial reporting requirements from what is expected by the regulator.”
Another reason advanced by the administrator was that such industry standards would provide accurate means of reporting cost and expenses which were required for tariff determination, fair comparison of the performance of the regulated entities.
Talba said it was in line with the international best practices to have accounting standards for power supply industry and that the Nigerian industry would not be an exception if it must attract foreign investors as well as provide a uniform means of valuing assets within the NESI.
Meanwhile, the commission has put in place the safety manual, vesting contracts and trading arrangement for the transitional and medium stages of the industry, NERC Business Rules in addition to earlier ones like the Grid Code, Metering Code, Distribution Code, NERC Business Rules, Customer Service Standards, Market Rules as part of the reforms going on in the industry. He said that the workshop was jointly organized with the NASB to enlighten stakeholders and to get their inputs from the other stakeholders.