Investor Presentaiton
The Country and its
institutions
Business Organisation Labour and Social
and Regulation
Security Regulations
The Nigerian Financial Tax System
Services Industry
Foreign Exchange
Transactions
Investment in Nigeria
Accounting and
Auditing Requirements
Importation of Goods
Exportation of Goods
COVID-19 Economic
and Fiscal Measures
8.2
Financial Statements
CAMA is the enabling law on administration of companies in the country. It regulates
how the affairs of any company in Nigeria will be run in many respects, including the
following:
8.1
•
•
Accounting Records
CAMA requires every company to keep proper accounting records at its registered
office or such other place in Nigeria as the directors may think fit. The records
should be sufficient to show and explain the transactions of the company with
reasonable accuracy at any time and facilitate the preparation of the financial
statements64
CAMA provides that the accounting records should contain:
entries from day to day of all sums of money received and expended by the
company, and the matters in respect of which receipt and expenditure take
place;
a record of the assets and liabilities of the company;
• statements of stocks held by the company at the end of the financial year; and
all statements of stocktaking from which the statements of stock have been
prepared.
8.3
Every officer of a company who fails to comply with the above provision will be
guilty of an offence, unless he can prove that he acted honestly, and that the
default was excusable in the circumstances in which the business of the company
was carried on.
18.00
$27
The directors are obliged, at the first meeting after incorporation of the company,
to determine the financial year of the company. They are also responsible for the
preparation of the company's financial statements for each year.
The financial statements must comply with the requirements of CAMA with
respect to their form and content, and prepared in accordance with the prevailing
accounting standards in Nigeria.
In July 2010, the Executive Council of the Federation (ECF) approved January
2012 as the effective date for transition from Statements of Accounting Standards
issued by the defunct Nigerian Accounting Standards Board (NASB) to International
Financial Reporting Standards. The ECF also directed the NASB to take further
necessary actions to give effect to the decision.
In June 2011, the Financial Reporting Council of Nigeria (FRCN) Act was enacted to
repeal the NASB Act of 2003 and establish the FRCN. The FRCN is charged with
the responsibility for, among other things, developing and publishing accounting
and financial reporting standards to be observed in the preparation of financial
statements in Nigeria.
Audit Requirements
Every company is required, at each annual general meeting, to appoint an auditor or
auditors to audit the financial statements prepared by its directors. The auditor(s)
have the statutory responsibility of carrying out such investigations that will enable
them to form an opinion on whether:
(a) proper accounting records have been kept by the company and proper returns,
adequate for their audit, were received from branches not visited by them; and
(b) the company's balance sheet and (if not consolidated) its profit and loss
account agree with the accounting records and returns and have been properly
prepared in accordance with CAMA.
A company's auditor is obliged, in the performance of his duties, to exercise all
such care, diligence and skill as is reasonably necessary in each circumstance.
Consequently, where a company suffers loss or damage as a result of negligence,
the directors can institute an action for negligence against the auditor in the court.
64
KPMG
CAMA 2020 exempts small companies from the requirement to audit their financial statements.
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