ACCOUNTANTS AWARENESS OF THE IMPLICATION OF INTERNATIONAL FINANCIAL REPORTING STANDARD IN NIGERIA
ABSTRACT
This study was carried out with the aim of examining accountants’ awareness of the implication of international financial reporting standard in Nigeria. In order to actualize the objectives of the study, various literature and theoretical issues were discussed. The instrument used for the purpose of this research was gathered through primary and secondary sources. The primary source is through questionnaires, while the secondary source extracts from textbooks by different authors, journals and other publications. The mass of information generated from the questionnaires was summarized in form of table and analyzed using simple percentage. The researcher administered one hundred (100) questionnaires to respondents comprising of members of ICAN and ANAN, out of which ninety-five (95) questionnaires were retrieved. For the purpose of presenting and analyzing responses to issues raised in the questionnaires, the returned questionnaires are taken to 100%.  The data collected was analyzed using Z-test statistical tool. The findings from the analysis revealed among other things that, there is a relationship between accountant level of awareness of the implication of IFRS in Nigeria. Recommendations were however made by the researcher.
TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
Background to the Study                        
Statement of the Research Problem                
Objective of the Study                        
Research Hypothesis                        
Scope of the Study                        
Significance of the Study                    
Research Methodology                         
Limitation of the Study                        
References                                
CHAPTER TWO: LITERATURE REVIEW
Introduction                         
International Financial Reporting Standard (IFRS)    
IFRS Adoption                            
Accounting Standards                         
International Accounting Standard Committee             
International Accounting Standard Board             
Financial Accounting Standard Board (FASB)    
International Financial Report Standards            
Adoption of IFRS in Some Countries                     
Harmonization of International Accounting Standard and Framework                                 
Need for Harmonization of International Accounting Standards     
Adoption of International Financial Reporting Standards in
Nigeria General Overview                    
References                             
CHAPTER THREE: RESEARCH METHODOLOGY
Introduction                         
Research Design                            
Population of the Study                            
Sample and Sampling Technique                
Research Instrument                        
Reliability of the Instrument/Data Analysis Method        
References                                    
CHAPTER FOUR: DATA ANALYSIS AND INTERPRETATION
4.1    Introduction                            
4.2    Descriptive Statistics                         
4.3    Test of Hypothesis                 
CHAPTER FIVE:    SUMMARY, FINDINGS, CONCLUSION AND RECOMMENDATION
5.1    Introduction                         
5.2    Summary                                 
5.3    Findings                                 
5.4    Conclusion                                 
5.5    Recommendations                     
    Bibliography                             
Appendix                             
CHAPTER ONE
INTRODUCTION
BACKGROUND TO THE STUDY
A financial reporting system supported by strong governance, high quality standards, and sound regulatory frameworks is key to economic development indeed, the IFRS are accounting rules and standards issued by the International Accounting Standard Board (IASB). They purport to be a set of rules that ideally would apply equally to financial reporting by public companies worldwide. Predisposing factors for the adoption of International Financial Reporting Standard (IFRS) is based amongst others on the premise that higher quality and more comparable reporting and disclosure can have economy-wide benefits and positive externalities (Berger and Honn, 2007).
Study by Deloitte and Touche (2006) and Ball (2005) reveal that movement towards standardization of financial reporting are based on the need for “high quality, transparent and comparable information”. This requires low capacity for managerial manipulation, timeliness of financial statement and accurate depiction of economic reality.
Proponent of IFRS argue that the standard reduce information cost to an economy particularly as capital flows and trade become more globalised, a single set of international standards will enhance comparability of financial information and should make the allocation of capital across border more efficient. The development and acceptance of international standards should also reduce compliance cost for corporations and improve audit quality (Leuz level of optimism that the global migration towards IFRS would most likely facilitate cross-border investment; integration of capital market and eases the constraints to investing by foreigners (Merton, 1987; Cooper and Kaplanis, 1986; Stulz, 1981 and Leuz, 2005).
However there are a number of studies that disagree with the assumption that changing the accounting standards alone can make corporate reporting more informative and comparable. Studies by Joes and Wysocki (2007) and Miller and Broadwhaw (2008) reveal that moving to a single set of accounting standards is not enough to produce comparability of reporting and facilitate investment flows even if the standard are strictly enforced. Reporting incentive still very systematically across firms and countries, according to the World Bank (2004) Report, the structure of national economies, the legal framework, the tax system and the level of development of one accounting profession shape the extent to which these international standards can be adopted across countries.
In captioning the experience of most developing countries like Nigeria, the World Bank (2004) note that guidance is not provided on how to appropriately adopt international standard into national legislative and regulatory systems while still ensuring compatibility with the existing legal, economic and regulatory institutions which could contribute to the monitoring and enforcement of international standard. As currently drafted, international standard implicitly assume the existence of legal institutional and policy condition (“preconditions”) which are often undeveloped or absent in money countries. In Nigeria as in other developing transition economics, the evolution of the body of accounting rules and reporting standard is often as a result of the economic circumstances, peculiar business environment, and legal framework amongst others.
However Mrs. Arunmia Oteh, Director-General Securities and Exchange Commission (SEC) noted at a press briefing on 5th February 2010 that; “The SEC is paying attention to make sure listed companies are IFRS compliant because compliance fosters good corporate standards by improving transparency and disclosure. While converting to IFRS can be a complex process those standards have important and positive implications for companies, it allows them to present their financial statement in the same basis as their foreign competitors, for investors, it offers better information for decision making. For regulatory bodies, it provides superior information for market participant in a disclosure based system”.
Though theoretically appealing, evidence from extant literature indicates that convergence is not an unchallenging process. It necessitates certain fundamental challenges, concerns and implication. Consequently, this study is an attempt to evaluate the awareness of accountant of implementation of IFRSs in Nigeria.
STATEMENT OF THE RESEARCH PROBLEM
The major challenges surrounding the enforcing uniform accounting standards is feasible given that countries differ considerably in almost all faces. The structure of national economies, the legal framework, the tax system, the political environment and the level of development of the accounting profession and all significant factors that influences the extent to which these international standards can be implemented across countries consequently, significant cost are likely to occur from transitioning to IFRS for the purpose of the study the following research question were formulated:
What are the complexity and structure of IFRS in Nigeria?
What are the technical competency of preparers, auditors and users of IFRS in Nigeria?
What are the legislative requirements of IFRS in Nigeria?
What are the system capability and internal capability of IFRS in Nigeria?
What are the accountant levels of awareness of the implication of IFRS in Nigeria?
OBJECTIVE OF THE STUDY
To identify the complexity and structure of IFRS in Nigeria.
To examine the technical competency of preparers, auditors and users of IFRS in Nigeria.
To evaluate the legislative requirement of IFRS in Nigeria.
To identify the system capability and internal capability of IFRS in Nigeria.
To find out accountants level of awareness of the implication of IFRS in Nigeria.
RESEARCH HYPOTHESIS
H0:     There is no relationship between the implementation of IFRS and the structure and complexity in Nigeria
    H1:     There is a relationship between the implementation of IFRS and the structure and complexity in Nigeria.
H0:     There is no relationship between the implementation of IFRS and technical competency of preparers, auditors and users.
    H1:     There is relationship between the implementation of IFRS and technical competency of preparers, auditors and users.
H0:     There is no relationship between accountant level of awareness of the implication of IFRS and its implementation in Nigeria.
    H1:     There is relationship between accountant level of awareness of the implication of IFRS and its implementation in Nigeria.
SCOPE OF THE STUDY
The scope of the study is restricted to the Nigeria environment. Consequently, it is based on a random sample size of respondents consisting of accountants, and professional auditors in Nigeria.
SIGNIFICANCE OF THE STUDY
This study will be relevance in the following ways:
Regulators such as Security and Exchange Commission (SEC), Central bank of Nigeria (CBN), etc, will find it as usable tool in the formulation of policy as this study does not only identify one key steps involve in the adoption, it also highlight it challenges of implementation as well as it implication.
Companies’ management will find it useful in making their decision to adopt the accounting policy as well as in preparation of financial statement.
Accounting firms/consultant will find this study very useful in the cause of their service to their clients.
Accountants/Auditors of companies will appreciate the study as it expose the implications and challenges of implementation involves in adoption as well as its procedure.
General public will find it useful not only because it identify the challenges of implementation and implication, it also examine the extent of adoption by Nigeria companies.
RESEARCH METHODOLOGY
This study will make do with both the primary and the secondary data. The primary source of data collection will base on the information obtained through questionnaires administered to elite respondents.
Questionnaires would be used to generate the required information needed to test the hypothesis formulated.
A total of 80 questionnaires will be administered to respondents. Thereafter, Z-test statistics will be used to test the relationship between the variables.
LIMITATION OF THE STUDY
The study is restricted to the accountant awareness of the adoption of IFRS:
Time: the study was conducted and submitted within short period of time and this affect the scope of the study.
Geographical location: the study was restricted to selected firms in Benin City.
Availability of data: this study was based on the data that the research could get.
REFERENCES
Aruma, D. (2010); “A Roadmap for Transforming the Nigeria Capital market” delivered at the SEC media Center Press, Lagos.
Ball. R, (2005): ”Making Accounting more International Why, How and How far Will it Go”, Journal of Applied Corporate Finance, 8: 19-29.
Bradshaw, M. B. Bushee and G.Miller (2008):     “Will Harmonize Really Harmonize Accounting”. Journal of Auditing and Finance, 23:233-263.
Cooper, I. A. and Kaplanis, E. (1986) Costs of Crossborder Investment and International Equity Market Equilibrium, in Jeremy Edwards (ed.), Recent Advances in Corporate Finance, Cambridge University Press, Cambridge.
Delliote and Touche (2008): ”International Financial Reporting Standards: Implications of an Accelerating Global Trend.” Deloitte and Touche LLP.
Merton, R. C., 1986, .A Simple Model of Capital Market Equilibrium with Incomplete Information. Journal of Finance, 42:483-510
Stulz, R. M. (1981). “A Model of International Asset Pricing.”Journal of Financial Economics, 9:383-406.
World Bank (2004): ”Report on the observance of standard and codes on Accounting and Auditing in Nigeria.” Available at http://www.World bank.Org/IFA/ROSC.