ACCOUNTING STANDARDS IN SELECTED COUNTRIES:

NIGERIA, THE UNITED KINGDOM (UK) AND THE UNITED

STATES OF AMERICA (USA)

PRESENTED BY:
ALOHAN Osayamen Bright
SPGS/ACC/18508

BEING A PAPER PRESENTED IN PARTIAL FULFILMENT OF

THE REQUIREMENTS OF FINANCIAL ACCOUNTING THEORY
(ACC 821) FOR THE AWARD OF MASTER OF SCIENCE (M. Sc)
DEGREE IN ACCOUNTING IN THE DEPARTMENT OF
ACCOUNTING, SCHOOL OF SOCIAL AND MANAGEMENT
SCIENCES, WELLSPRING UNIVERSITY, BENIN CITY.

COURSE LECTURER:
PROF. OKOYE A. E.

NOVEMBER, 2019
INTRODUCTION
There is hardly any country in the world today that does not have a set of accounting
standards that guide its accounting practices. These standards are either developed locally or
adopted internationally. Accounting standards are issued by various accounting standards
setting bodies like the International Accounting Standards Board (IASB) of the International
Federation of Accountants (IFAC), the Financial Accounting Standards Board (FASB) of the
United States of America (USA), the Accounting Standards Board (ASB) of the United
Kingdom (UK) etc for the purpose of providing guidance in the preparation of financial
reports application of accounting principles and conventions. Accounting standards make it
possible for accounting information to be similar if not completely the same across
jurisdictions or countries. In the recent past, effort has been made by the International
Federation of Accountants (IFAC) to harmonise accounting practices globally. This led to the
creation of the International Accounting Standards Board (IASB) which adopted the IASs
issued before its establishment and has since issued sixteen (16) standards since its creation.
The effort of the IFAC has so far not yielded the desired result. This is because unlike
Nigeria, some countries still stick or partially stick to their local standards. Examples of such
countries are The United States of America (USA) and the United Kingdom (UK). The focus
of this paper is therefore to consider accounting standards in three countries – Nigeria, United
Kingdom (UK) and the United States of America (USA).

MEANING OF ACCOUNTING STANDARDS

Accounting standards are rules and guidelines set up by governing bodies,
like FASB and IASB, to keep accounting practices consistent and understandable across all
companies and industries. These rules have an impact both on a national economy and on the
economic and fiscal policy. With the implementation of accounting guidelines on a national
scale, countries are able to implement a common terminology in the economic world and
perform a precise, uniform, objective and correct calculation of data on the financial position
and results of business units.
The International Accounting Standards (IAS) constitute a single set of high-quality
accounting standards, which help in the preparation of consolidated financial statements,
including the balance sheet, income statement, statement of changes in the financial position,
cash flow statement and explanatory notes. The standardization of the accounting procedures
helps businesses to record and monitor their business activity and achieve comparability of
accounting information between companies that operate in the same industry. By applying
the same accounting principles and methods, businesses ensure homogeneous, reliable and
accurate data and information about their assets, liabilities, financial position, and overall
activity.
Types of Accounting Standards
Accounting Standards may be classified by their subject-matter and by how they are
enforced.
According to subject-matter, standards may be as follows:
(1) Disclosure Standards:
Such standards are the minimum uniform rules for external reporting. They require only an
explicit disclosure of accounting methods used and assumptions made in preparing financial
statements. Such a standard is likely to be controversial or creates conflicts of interest,
particularly since it does not constrain the choice of accounting policies or items to be
disclosed.
(2) Presentation Standards:
They specify the form and type of accounting information to be presented. They may specify
that certain financial statements be presented (e.g., a funds-flow statement) or that items be
presented in particular order in financial statements. Such standards place only a little more
constraint upon the choice of accounting policies than disclosure standards and aim to reduce
the costs to users of utilising financial statements.
(3) Content Standards:
These standards specify the accounting information which is to be published.
There are three aspects to such standards:
(a) Disclosure: Disclosure Content standards which specify only the categories of
information to be disclosed.
(b) Specific: Specific Construct standards which specify how specific items should be
reported in accounts, e.g., a standard which specifies that finance leases be capitalized and
disclosed in balance sheet.
(c) Conceptually: Conceptually Based standards which specify the accounting treatment of
items based upon a coherent and complete framework of accounting.
Another classification of accounting standards may be based upon their method of
preparation and enforcement. Such standards are:
(1) Evolutionary and Voluntary Compliance Standards: Such standards have evolved as
best practices and represent the conventional approach to accounting. As such, their general
acceptability implies voluntary compliance by individual companies.
(2) Privately Set Standards: Private accountancy bodies may formulate standards and
devise means for their enforcement. Other bodies such as trade associations or stock
exchanges may set accounting standards for companies as a condition of membership or
listing. Enforcement powers are thus more readily available.
(3) Governmental Standards: These standards may be laws relating to company accounting
practices and disclosure, as in the case of the Indian Companies Acts, or tax rules defining
taxable profit. Alternatively, Government departments or agencies may regulate accounting
practices for certain industries. It is significant to note that the above two classifications are
complementary and not competitive.

RELEVANCE OR IMPORTANCE OF ACCOUNTING STANDARDS

To Improve the Credibility and Reliability of Financial Statements: Financial statements
of business enterprises are used by a diverse group of users for making sound economic
decisions such as shareholders (existing and potential), suppliers (existing and potential),
trade creditors, customers employees, taxation authorities, and other interested parties. It is
necessary, therefore, that the financial statements, the users use and upon which they rely,
present a fair picture of the position and progress of the enterprise. It is the function of
accounting (and auditing) standards to create this general sense of confidence by providing a
structural framework within which credible financial statements can be produced. Where
various alternative methods of measuring an economic activity exists, it is important that the
best available one be used uniformly within a firm, by different firms, and to the extent
practicable, by different industries. This guideline is required in order to meet a basic need of
managers, investors and creditors to compare results and financial conditions of different
segments of firms, different periods of a firm, different firms, and different industries.
Benefits to Accountants and Auditors: Given the increasing risks, the accounting
profession realised that it needed to know what accounting standards are to prevail. Though
individual accountant and chartered accountancy firm are concerned with their own
reputations, the other accountants’ and firms’ misconduct would prove costly since all
accountants belong to a class in the eyes of public.
While members of a chartered accountancy firm can discipline their fellow partners, it is
difficult to monitor the performance of other chartered accountants. For this purpose, the
establishment of standard to which all chartered or certified accountants subscribe is useful.
Thus, accounting standards are beneficial not only to the business enterprises but also to the
accountants and auditors as well.
Without standards such as GAAP or IFRS, businesses could interpret financial information in
whatever way makes them look best.
Without Accounting Standards, companies could fudge their figures in many other ways. For
example, you could shift your accounting methods to whatever presents your company in the
best light. GAAP requires businesses to use consistent accounting methods over time.

HISTORY OF ACCOUNTING STANDARDS IN NIGERIA

In Nigeria, the development of accounting and accounting standards could be traced to the
then Association of Accountants of Nigeria -AAN (now Institute of Chartered Accountants
of Nigeria -ICAN). The AAN was formed on the 17th of November 1960 and granted official
recognition on 28th September 1965, under the Federal Parliament Act number 15 of 1965,
to regulate accountancy profession in the country. History suggests that ICAN was
responsible for the formation of the Nigerian Accounting Standards Board (NASB) before it
was taken over by government. (Josiah, Okoye, and Adediran, 2013; Basoglu and Goma,
2007). The Nigeria Accounting Standard Board (NASB) was established in 1982 as a private
sector initiative closely associated with the Institute of Chartered Accountants of Nigeria
(ICAN). NASB first became a government parastatal in 1992 as a component of the then
Federal Ministry of Trade and Tourism. The NASB issued a total of 32 Statement of
Accounting Standards (SAS). The Nigerian Accounting Standards Board Act of 2003
provided the legal framework under which NASB set accounting standards. Membership
includes representatives of government and other interest groups. Both ICAN and the
Association of National Accountants of Nigeria (ANAN) nominate two members to the
board. The primary functions as defined in the Act were to develop, publish and update
Statements of Accounting Standards (SAS) to be followed by companies in the preparation
of their financial statement, and to promote and enforce compliance with the standards.
However, in 2010, it was observed that the NASB did not have adequate funding to achieve
its statutory role such as hire new staff, re-train existing staff and offer more attractive pay. In
June 2010 Mr. Godson Nnadi, the then Executive Secretary of Nigeria Accounting Standards
Board, spoke in favour of a new body to set accounting and auditing standards for Nigeria
and other African nations that would be independent of both ANAN and ICAN. On June 3,
2011, President Goodluck Ebele Jonathan signed into law the Financial Reporting Council of
Nigeria Act, No 6, 2011 and therein repealed the Nigerian Accounting Standards Board
(NASB) Act No. 22, 2003. The Financial Reporting Council (FRC) Act, 2011 establishes the
FRC as the Federal government agency 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 and for related matters.

Overview of Financial Reporting Council of Nigeria (FRCN)

The Financial Reporting Council of Nigeria (FRCN) was established by the Financial
Reporting Council Act, 2011(Section 1). The Act established for the council a board which
shall have overall control of the council and further gave the composition of the board as
follows (Section 2):A Chairman who shall be a professional accountant with considerable
professional experience in accounting practices, the Executive Secretary of the Council, two
representatives from the Association of National Accountants of Nigeria, two representatives
from the Institute of Chartered Accountants of Nigeria, and one representative from each of
the following: Office of the Accountant General of the Federation, Office of the Auditor
General for the Federation, Central Bank of Nigeria, Chartered Institute of Stockbrokers,
Chartered Institute of Taxation of Nigeria, Corporate Affairs Commission, Federal Inland
Revenue Service, Federal Ministry of Commerce, Federal Ministry of Finance, Nigerian
Accounting Association, Nigerian Association of Chambers of Commerce, Industries, Mines
and Agriculture, Nigerian Deposit Insurance Corporation, Nigerian Institute of Estate
Surveyors and Valuers, Securities and Exchange Commission, National Insurance
Commission, Nigerian Stock Exchange, and National Pension Commission. Section 8 of the
Act stipulates the functions of the Council as follows: Develop and publish accounting and
financial reporting standards to be observed in the preparation of financial statement of
public interest entities; Review, promote and enforce compliance with the accounting and
financial reporting standards adopted by the Council; Receive notices of non-compliance
with approved standards from preparers, users, other third parties or auditors of financial
statements; Receive copies of annual reports and financial statements of public interest
entities from preparers within 60 days of the approval of the Board; Advise the Federal
Government on matters relating to accounting and financial reporting standards; Maintain a
register of professional accountants and other professionals engaged in the financial reporting
process; Monitor compliance with the reporting requirements specified in the adopted code
of corporate governance; Promote compliance with the adopted standards issued by the
International Federation of Accountants and International Accounting Standards Board;
Monitor and promote education, research and training in the fields of accounting, auditing,
financial reporting and corporate governance; Conduct practice reviews of registered
professionals; Review financial statements and reports of public interest entities; Enforce
compliance with the Act and the rules of the Council on registered professionals and the
affected public interest entities; Establish such systems, schemes or engage in any relevant
activity, either alone or in conjunction with any other organization or agency, whether local
or international, for the discharge of its functions; and Receive copies of all qualified reports
together with detailed explanations for such qualifications from auditors of the financial
statements within a period of 30 days from the date of such qualification and such reports
shall not be announced to the public until all accounting issues relating to the reports are
resolved by the Council.

Current Status of Accounting Standards in Nigeria

Nigerian Accounting standards (SAS) have been replaced by International Financial
Reporting Standards (IFRS). However, Nigeria standards include industry specific rules
which are not found in IFRS. Companies in the industry covered are expected to continue to
apply these rules insofar as they do not conflict with IFRS. Such relevant standards include:
SAS 14: Accounting in the Petroleum Industry: Downstream Activities.
SAS 17: Accounting in the Petroleum Industry: Upstream Activities. And
SAS 25: Telecommunications Activities. (ICAN Study Pack on Corporate Reporting, 2014)
It will not be totally wrong to conclude that the adoption of IFRS and the enactment of the
Financial Reporting Council Act, 2011 were triggered by the nation’s sense of belonging
since IFRS has already been embraced by over 122 countries. This sense of belonging and
not feeling left out can be seen as positive when the growth and development of the nation is
at stake. According to Asein (2011), it was expedient and in the best interest of the nation to
raise and benchmark the quality of its financial reporting on current global best practices by
adopting IFRS in order to achieve its goal of becoming one of the twenty largest economies
of the world by year 2020 (vision 20:2020 goals). It can be deduced from Obazee (2011), that
the move towards adopting the IFRS was majorly triggered by the nation’s objective to
realise the full gains of cross border listing.

Overview of the International Financial Reporting Standards (IFRSs).

The term IFRS consists of International Financial Reporting Standards (IFRS) issued by
International Accounting Standards Board (IASB); International Accounting Standard (IAS)
issued by International Accounting Standard Committee (IASC); and interpretations issued
by the standard interpretations Committee (SIC) and the International Financial Reporting
Interpretation Committee. The International Accounting Standard states how particular types
of transactions and other events should be reported in financial statements. The standards
issued by IASC were known as IAS. In 2000, IASC member bodies approved the
restructuring of IASC‟s foundation and in March 2001, the new IASB took over the
responsibility of setting the international Accounting Standards from IASC. IASB adopted
the standards set by IASC and continued to develop new standards and called the new
standards –IFRS. Both IFRS and IAS are equally enforceable. (Ikpefan and Akande, 2012).
The predecessor of the IASB, the International Accounting Standards Committee (IASC),
was founded in June 1973 as a result of an agreement by accountancy bodies in Australia,
Canada, France, Germany, Japan, Mexico, the Netherlands, the United Kingdom and Ireland,
and the United States. By 1998, the IASC had expanded membership to 140 accountancy
bodies in 101 countries. In 2001, the IASC was reconstituted into the IASB. The IASB has
14 full -time board members who deliberate on new financial reporting standards. The IASB
is overseen by the International Accounting Standards Committee Foundation, which has 19
trustees who appoint the members of the IASB, establish the budget, and monitor the IASB‟s
progress. The IASB is advised by the Standards Advisory Council, which is composed of
about 50 members representing organizations and individuals with an interest in international
financial reporting. (Robinson, Greuning, Henry, and Broihahn, 2009). Fowokan (2011)
opined that in early days, the IAS were aimed to promoting best practice in the preparation of
financial statements whilst permitting different treatments for given transactions and events.
The application of IAS in preparing financial statements did not always result into uniform
and comparable financial information simply because similar transactions and events were
not necessarily reported in a like way. With the dawn of globalization and increasing demand
for transparent, comparable financial information in the markets, the IASC was restructured
in 2001 by creating the international Accounting Standards Board (IASB), among other
changes. The IASB is responsible for developing, in the public interest, a single set of high
quality, understandable and enforceable global accounting standards that require transparent
and comparable information in general purpose financial statements and other financial
reporting to help participants in the various capital markets of the world and other users of
the information to make economic decisions.

HISTORY OF ACCOUNTING STANDARDS IN THE UNITED KINGDOM (UK)

The Taxation and Financial Relations (T&FR) Committee of the ICAEW was established in
1942 and was asked by the council of the ICAEW to consider and make recommendations to
the council on certain aspects of the accounts of companies and to publish approved
recommendations for the information of members. The first ‘Recommendations on
Accounting Principles’ were published in December 1942 on the subjects of Tax Reserve
Certificates and War Damage Contributions, Premiums and Claims. These recommendations,
and those that followed, provided members of ICAEW with early guidance on accounting
practice. At a press conference on 11 December 1969 the ICAEW released a ‘Statement of
Intent on Accounting Standards in the 1970s’ which expressed the determination of the
council to advance accounting standards, setting out the steps the institute felt would be
necessary to achieve this. The importance of this development could be ‘likened only to the
inauguration of the Institute's series of recommendations a quarter of a century ago. The
ICAEW established the Accounting Standards Steering Committee in January 1970 with ‘the
object of developing definitive standards for financial reporting’ (‘History of the Accounting
Standards Committee’, Accounting Standards). The Irish and Scottish institutes became
members of the Accounting Standards Steering Committee in the same year, followed by the
Association of Certified Accountants (now the ACCA) and the Institute of Cost and
Management Accountants (now CIMA) in 1971.
The first Statement of Standard Accounting Practice (SSAP) on ‘Accounting for the results
of associated companies’ (SSAP 1) was issued in January 1971. A total of 34 statements (or
revised statements) were released between 1971 and 1990. Initially the SSAPs sat alongside
the ‘Recommendations on Accounting Principles’ issued by the ICAEW. The explanatory
foreword to the 1977 edition of Accounting Standards stated:
‘In so far as they are not replaced by Statements of Standard Accounting Practice, the
Council's ‘Recommendations on Accounting Principles’ will continue in effect as guidance
statements and indicators of best practice. They are persuasive in intent and departures from
them do not necessarily require disclosure as do departures from accounting standards’.
In 1976 the name of the Accounting Standards Steering Committee (ASSC) was shortened to
the Accounting Standards Committee (ASC) and its constitution was revised. The ASC
became a ‘joint committee of the six member bodies who then acted collectively through the
Consultative Committee of Accountancy Bodies’. Later, in 1985, the ASC became a
committee of the CCAB. In November 1987 the CCAB appointed Sir Ron Dearing to review
the standard setting process. The final report  ‘ The making of accounting standards: Report
of the Review Committee’ (published in September 1988) recommended the establishment of
the Financial Reporting Council, the Accounting Standards Board and the Review Panel. In
1990 the government announced the establishment of a new Financial Reporting Council
(FRC). The FRC was charged with promoting good financial reporting through two
subsidiary bodies: the Accounting Standards Board, which replaced the ASC on 1 August
1990, and the Financial Reporting Review Panel (FRRP).
On its creation, the Accounting Standards Board (ASB) adopted a number of SSAPs that had
been issued by the ASC so that they were brought within the legal definition of accounting
standards according to the Companies Act 1985. All accounting standards developed by the
ASB from 1990 were issued as Financial Reporting Standards (FRS). The newly established
ASB was assisted by an Urgent Issues Task Force (UITF) which held its first meeting in
1991. The Urgent Issues Task Force (UITF) was established to investigate areas where
conflicts or unsatisfactory interpretation of an accounting standard or Companies Act
provision exists or may develop in the future. The first abstract issued by the UITF was
‘Convertible bonds – supplemental interest/premium’ which was released on 24 July 1991. In
2004 the government took the decision to strengthen the regulatory system in the UK
following the major corporate collapses in the US. This led to the FRC's role being extended
to become the single independent regulator of the accounting and auditing profession as well
as being responsible for issuing accounting standards and dealing with their enforcement.
The present FRC and its subsidiary bodies are funded jointly by the accountancy profession,
the financial community and the government. Reforms were carried out in July 2012 to
enable the FRC to operate as a unified regulatory body with enhanced independence. A new
structure was implemented to ensure effective governance of all of the FRC's regulatory
activities under ultimate responsibility of the FRC Board.
As part of the reforms, the Codes and Standards Committee was established to advise the
FRC Board on maintaining an effective framework of UK codes and standards. The
Accounting Council also replaced the Accounting Standards Board (ASB), assuming an
advisory role to the Codes & Standards Committee and the FRC Board. The UITF was also
disbanded as a result of the reforms. Whereas accounting standards were previously set by
the ASB, this became the responsibility of the FRC Board on 2 July 2012. The FRC issued
six standards between 2012 and 2015. The standards include FRS 100, FRS 101, FRS 102,
FRS 103, FRS 104, and FRS 105.
Current Status of Accounting Standards in The United Kingdom (Uk)
The Standard Statement of Accounting Practice (SSAP) adopted by the Financial Reporting
Council (FRC) and the Financial Reporting Standards (FRS) issued by the FRC are the
standards currently in use in the United Kingdom (UK). These are now referred to as the UK
– GAAP.

HISTORY OF ACCOUNTING STANDARDS IN THE UNITED STATES OF

AMERICA (USA)
After the stock market crash of 1929, many investors and other market participants felt that
insufficient and misleading accounting and reporting has inflated stock prices that eventually
crashed the stock market and followed by the Great Depression. The continuing pressures on
the accounting profession to establish accounting standards prompted the American Institute
of Accountants (now known as the AICPA) and the New York Stock Exchange to start an
effort to review and revise financial reporting requirements. A few years later, the Securities
Act of 1933 and the Securities Exchange Act of 1934 were passed into law to restore investor
confidence. The Securities Act sets forth the accounting and disclosure requirements for the
initial offering of stocks and bonds while the Securities Exchange Act sets the reporting
requirements for secondary market offerings. The 1934 act also created the U.S. Securities
and Exchange Commission (SEC) which was mandated with both the power and
responsibility for standard-setting of financial accounting and reporting for publicly-traded
companies. But the SEC while keeping the power to set standards has chosen to delegate its
rule-making responsibilities to the private sector. This means that if the SEC does not
conform to a specific standard issued by the private sector, it has the authority to change that
standard, which it has done in the past. Despite delegating its rule-making responsibility, the
SEC issues its own accounting pronouncements called Financial Reporting Releases (FRRs).
A committee of the American Institute of Accountants, the Committee on Accounting
Procedure (CAP) was the very first private-sector standard setting body. During its existence
from 1938 to 1959, the CAP issued 51 Accounting Research Bulletins (ARBs). Since, it has
not established a financial accounting conceptual framework, its rule-making approach of
dealing with accounting and reporting problems and issues was subject to severe criticism. 
The CAP was then replaced by the Accounting Principles Board (APB) which was able to
issue 31 Accounting Principles Board Opinions (APBOs), 4 Statements and several
interpretations during its tenure from 1959 to 1973. In contrast to its predecessor, it attempted
to establish a conceptual framework with its APB Statement No. 4 but failed. In addition to
its unsuccessful effort to create a framework, it was also under fire for its apparent lack of
independence because its board members were supported by the AICPA and that other
interest groups were not represented in the rule-making process.
Emphasizing the significance of an independent standard-setting structure, the APB was
reorganized in 1973 into a new body called the Financial Accounting Standards Board
(FASB). As compared to APB’s 18-21 part-time members who mostly represented public
accounting firms, the FASB has 7 full-time members representing the accounting profession,
industry and other various interest groups such as the government and accounting educators.
The operation of the FASB is financially supported and supervised by its parent organization,
the Financial Accounting Foundation (FAF). In 1984, the Government Accounting Standards
Board (GASB) was established under the FAF umbrella to issue standards for government
financial reporting. In the same year, the FASB formed the Emerging Issues Task Force
(EITF) with the role of responding to emerging accounting and financial reporting issues and
publishes its pronouncements in the form of EITF Issues – considered to form part of GAAP.
Only if, the task force cannot reach an agreement, that the involvement of the FASB may be
required. The function of the EITF is important because it makes the standard-setting process
more efficient and allows the FASB to concentrate on much broader and long-term problems.

Current Status of Accounting Standards in The United States of America (USA)

Financial Accounting Standards Board (FASB) is responsible for the issuance and
interpretation of US accounting standards. Its official mouth piece known as the Statements
of Financial Accounting Standards (SFAS) provide the basis on which US financial
accounting is prepared. The SFASs have the same authoritative influence as the United
Kingdom’s Financial Reporting Standards (FRS) of the Accounting Standards Board (ASB)
and the Statements of Standard Accounting Practice of the former Accounting Standards
Committee (ASC) in so far as the latter have not been superseded by FRS. (Ezejelue, 2001).
The FASB have issued more than one hundred and sixty two (162) Statement of Financial
Accounting Standards (SFASs), forty two (42) interpretations and many technical bulletins.
These standards, principles and other regulations that guide accounting practices in the
United States of America is referred to as US – GAAP.

Global Accounting Convergence

Since October 2002, the IASB and FASB have been working to remove differences between
international standards and US GAAP towards a common set of high quality global
accounting standards. Their commitment to the convergence effort was embodied in a
memorandum known as the Norwalk Agreement.
After 10 years of working together, some notable convergence projects have been
successfully completed. Major joint projects completed include converged standards on
business combinations (2008), consolidation (2011), fair value measurement (2011) and
revenue recognition (2014) and leases (2016).
Other projects have been discontinued because the two boards could not agree on some
issues such as standards on de-recognition, financial statement presentation, insurance
contracts, liabilities and equity, and post-employment benefits. The IASB has released its
own work on IFRS 9 Financial Instruments. This standard was no longer aligned as the
FASB decided to focus with its own development of financial instrument standard under US
GAAP.  
With the current status of the collaboration between the IASB and FASB, it appears that
global accounting convergence is no longer achievable.
CONCLUSION
Accounting standards are rules and guidelines set up by governing bodies,
like FASB and IASB, to keep accounting practices consistent and understandable across all
companies and industries. These rules have an impact both on a national economy and on the
economic and fiscal policy. When classified according to subject matter, accounting
standards could be grouped as Disclosure Standards; Presentation Standards and Content
Standards. When classified according to method of preparation and presentation, accounting
standards could be grouped into Evolutionary Standards; Private Standards and Government
Standards. Accounting Standards are important because they help to ensure the
harmonisation of financial information especially in the area of presentation of accounting
reports and in the accounting treatment of transactions and financial events. Nigeria as a
country has its own accounting standards which is the Statement of Accounting Standards
(SAS). However, as a result of the global effort towards harmonisation, it set aside its local
standards and adopted the International Financial Reporting Standards (IFRS). However,
three of such SASs are still being used in Nigeria as there are no equivalent IFRSs at the
moment. The three SASs are SAS 14, SAS 17 and SAS 25. The United Kingdom (UK) is yet
to fully adopt IFRS while the United States of America (USA) still stick to their local US –
GAAP at the moment. As at today, efforts are still being made by the International
Federation of Accountants (IFAC) to ensure that all countries in the world adopt a single set
of accounting standards.
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