Adoption of International Financial Reporting Standards and the Changing Accounting Environment in Nigeria

Abstract

The purpose of this chapter is to examine the major differences between Nigerian financial reporting rules and International Financial Reporting Standards (IFRS) following Nigeria's accounting reporting convergence to IFRS. The chapter documented evidence of differences between Nigerian Statement of Accounting Standards (NSAS), Companies and Allied Matters Act, 1990, Nigerian tax rules and IFRS requirements. It also discusses the IFRS adoption process in Nigeria and the benefits Nigeria stand to gain in adopting IFRS. The chapter discusses the challenges that might be encountered in the process of adoption of IFRS in Nigeria. Finally, the chapter provides recommendations through which these challenges can be addressed and suggest ways for further IFRS adoption research in Nigeria.

The impact of international financial reporting standards adoption and banking reforms on earnings management: evidence from Nigerian banks

“…As Madawaki (2016) observes that the shortage of these accounting professionals adds to the obstacles of effective implementation of the IFRS. In addition, major changes to the financial reporting framework are required for the convergence.…”

“…According to Madawaki (2016), the adoption of IFRS in Nigeria was planned into three phases: the first was for publicly listed entities and significant public interest entities to prepare their financial statements using applicable IFRS by January 1 st 2012. The entities were required to convert their closing balances at December 2010 to IFRS-based figures which would serve as the opening balance sheet figure for January 2011.…”

“…The adoption of the IFRS has significant implication and effect on taxation in Nigeria. Madawaki (2016) notes that the adoption of the Standards implies that the audited accounts to be submitted to the Federal Inland Revenue Service (FIRS) would be prepared in compliance with the standards issued by the International Accounting Standards Board (IASB). He notes that there are differences between the Nigerian Accounting Standards and the IASB which results from the conversion to IFRS particularly in area of taxation.…”