Globalization of Financial Reporting: Obstacles to ...ajbms.org/articlepdf/2ajbms05201403122839.pdf · Globalization of Financial Reporting: ... (IFRS) Adoption in Nigeria Wilson

www.ajbms.org Asian Journal of Business and Management Sciences

ISSN: 2047-2528 Vol. 3 No. 12[25-41]

©Society for Business Research Promotion | 25

Globalization of Financial Reporting: Obstacles to International Financial Reporting Standards (IFRS) Adoption in Nigeria

Wilson E. Herbert (Corresponding Author)

Professor of Accounting & Financial Management and Director, Academic Planning, Bingham University, Karu, Nasarawa State, Nigeria

E-mail: [email protected]

Emeka E. Ene

Senior Lecturer & Head, Department of Accounting,

Bingham University, Karu, Nasarawa State, Nigeria

Ioraver N. Tsegba

Associate Professor of Accounting & Finance,

Federal University of Agriculture, Makurdi, Benue State, Nigeria

ABSTRACT

This paper investigates the impediments to IFRS adoption in Nigeria. It

examines the attitudes of key stakeholders towards IFRS adoption. The

sample is drawn from academics and practitioners who are critical

stakeholders in the success or failure of IFRS implementation. The results of

the study overwhelmingly evidence that Nigeria was not prepared to adopt

IFRS, even to date. The study finds the two major roadblocks to IFRS adoption

as (i) lack of education, understanding and experience by preparers of

financial reports with the use of IFRS; and (ii) lack of coverage of IFRS in

contemporary accounting curricula. An important policy implication is the

urgency of accounting curriculum review in the tertiary education system to

incorporate IFRS and IPSAS and their implementation dimensions. Failure to

both integrate IFRS modules into Nigeria’s tertiary education accounting

curricula and coordinate tertiary accounting education programmes two years

after IFRS adoption exacerbates the implementation challenges and frictions

associated with such tardiness.

Keywords: Globalization, Financial Reporting, International Financial

Reporting Standards (IFRS), Nigeria

1. INTRODUCTION

The last two decades have witnessed an increasing wave of accounting scandals and

financial statements fraud, weak corporate governance and risk management practices,

culminating in the 2008 global financial meltdown. These corporate failures became scandalous not just because of the characteristics of the companies (size, age and their

reported past successes) that collapsed and their multiplier effects on the national and

global economies, “but also because of the discovery that questionable accounting practice

was far more insidious and widespread than previously envisioned” (Bhasin, 2013). The

plethora of incriminating evidence linking these egregious accounting practices to the corporate scandals and failures led to a number of national and global corporate

governance initiatives. For example, nation states, Nigeria inclusive, have made concerted

efforts to establish benchmark corporate governance codes, such as the Sarbanes-Oxley Act

2002, national Securities and Exchange Commission (SEC) Governance Codes. In addition,

not only have the integrity and competence of the accounting profession come under a

sharp scrutiny by a disturbed and bewildered public, but also doubts have been raised about national standards of financial reporting and corporate governance. With increasing

mailto:[email protected]


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


globalization, cross-border listings, and globalization of financial reporting, many countries

and jurisdictions have responded by enhancing their countries’ accounting oversight

functions as part of economic reforms to accommodate financial reporting standards. The new financial reporting architecture has thus assumed an influential role as a form of

corporate governance.

Since the 1970s, the community of international accounting professional bodies and

business leaders has been developing a single uniform set of international accounting

standards and reporting framework that will enjoy a global appeal. This single global reporting framework is perceived as a means of enhancing firm performance and good

corporate governance. Effective corporate governance requires accurate and reliable

financial information (Judge and Pinsker, 2010; Herbert and Tsegba, 2013). Historically,

corporate financial reporting has followed national standards, in which each country

developed and adopted its own financial reporting standards. However, since the 1980s, the imperatives of globalization have not only increased the integration of national economies

and financial markets into a global market, but have also necessitated the need for global

standardization of financial reporting methods and practices. The rationale within the

international business and accounting professional communities was that the adoption of a

consistent set of global financial standards would (a) curtail questionable and insidious

accounting practices, (b) eliminate the inconsistencies in financial reporting methods across countries, jurisdictions and regional borders, and (c) overcome the widespread poor

corporate governance practices that prospectively lead to poor corporate financial

performance.

The global concern for a uniform financial reporting architecture gave rise to the movement towards international harmonization of financial reporting standards of nation states. Thus,

the International Financial Reporting Standards (IFRS), which are a set of international

accounting standards, define and specify how particular types of financial transactions and

other events should be reported in financial statements. Issued by the International

Accounting Standards Board (IASB), the IFRS have been embraced all over the world as the

global benchmark for conducting and reporting financial transactions. The growing list of countries and the level of IFRS-compliance in these countries define IFRS’ acceptability by

the international business community.

From a historical perspective, the development of a strong international financial reporting

framework has been of longstanding interest to and has elicited (and still elicits) frequent commentary from accounting academics and professionals and men of affairs (business

leaders, politicians, labour leaders, and regulators). This perspective is reinforced by the

fact that accounting is shaped by economic and political forces (Watts, 1977; Watts and

Zimmerman, 1986). The key role played by financial reporting in national and global economic development is a prima facie evidence of investor confidence and trust it imbues

the business community. Investor confidence is vital to the optimal functioning of financial markets that foster economic development.

The globalization of economic activities juxtaposing increasing integration of national

economies and markets has resulted in an increased demand for high quality,

internationally comparable financial information. In the new globalized cum integrated

world, companies and investors operate beyond borders with their boundary spanning capabilities; they have foreign affiliations in various forms. Banks establish foreign

branches and correspondent banking relationships in several countries to service the

incremental dimensions of their growing portfolio of international customers. Foreign

companies and their nationals, development partners, international donor agencies, civil

society organizations (CSOs) and non-governmental organizations (NGOs), all traverse the global space of accounting and finance.

One of the discontents of globalization is the growing inequality between the Western

(developed) economies and developing and less developed countries (DLDCs), whether it is

in trade and commerce, energy and environmental policies, or in geopolitics in general. In

relation to the latter, most DLDCs are economically weak due to lack of domestic capacity


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


and weak social and physical infrastructure resulting in low export prices and significant

terms-of-trade decline. Furthermore, most DLDCs have not done well in organizing

themselves to coordinate substantial policy and negotiating positions or strategy in relation to the discussions and negotiations of the World Trade Organization (WTO), International

Monetary Fund (IMF), World Bank (WB) as well as other forums (Khor, 2005). Thus, despite

the deepening interdependence between national markets and economies, there is

nevertheless an undeniable underlying reality that the world is constrained by people and

economies fractured by strongly held beliefs, values, feelings, and practices that seem

intractable to reconcile.

These differences permeate all facets of human understanding and practices, of which

accounting, finance and international business are no exception. Nation states and

businesses need to understand and reconcile each other’s accounting principles upon

which resident companies prepare their financial statements, since it is at least universally acknowledged that accounting is the language of business. The trajectory of this

harmonization journey has been long, windy and tortuous. The IFRS are a testament to the

many years of international harmonization dialogue: they are boldly designed to guide the

accounting profession and business across the world into the global reality, showing

businesses and nation states the simplicity of uniform standards on the other side of the

complexity, illuminating insights and skills required to deal with contentious accounting dynamics in the 21st century of integrated economies and markets.

The transition to a global uniform framework is, therefore, an eloquent authentication of the

international consensus on IFRS as benchmarks for assessment of the financial health of

economic entities across the globe. This consensus is premised on the fact that increasing integration of regional and global markets in the presence of financial statement

comparability influences business decisions in many ways. Since IFRS adoption reflects a

fundamental shift in national as well as global accounting systems and professions, their

economic consequences are bound to evoke a lot of conversation. The dialogue is intended

to create greater professional and public awareness about their dimensions and

ramifications in a country. For example, before the European Union decided on IFRS adoption, it commissioned a lot of research and public discourse with key stakeholders

involving the universities and the accountancy profession across Europe. In the U.S. a lot of

research, public discussions and policy dialogue have been going on preparatory to the

country’s adoption. This spate of preparation has been absent in most DLDCs, especially

Sub-Saharan Africa (SSA).

In many countries, it is their national standard-setting bodies that have been involved in

limited public engagement and enlightenment campaigns. For most DLDCs, in particular,

the capacity is severely constrained by lack of funds. In Nigeria, the involvement of

Ministries, Departments and Agencies of Government (MDAs), financial regulatory bodies

and large corporate organizations in training and/or supporting national awareness and seamless transition to this all-important global financial reporting language has been at

best limited and at worst lethargic. Earlier studies, such as Herbert, et al. (2013), have

shown that a country’s level of preparedness is crucial to successful seamless

implementation. Although sketches of empirical attention to IFRS are springing up in

Nigeria, these are fundamentally peripheral: the main issues remain largely unresolved. Two particular areas requiring systematic inquiry are the economic consequences of IFRS

adoption, and the state of a country’s readiness to IFRS adoption.

As regards the former, a number of studies have examined the economic consequences of

IFRS adoption, with indicative evidence that IFRS adoption generally (a) improves quality of

accounting information (Barth, Landsman & Lang, 2008), and (b) reduces cost of equity capital (Daske, et al. 2008; Li 2010), even as their effects seem to vary by country and firm.

While a number of studies, such as Doidge, et al. 2004), have suggested that IFRS adoption

holds significant economic consequences for DLDCs, empirical evidence has been relatively

sparse. In particular, a largely unexplored praxis is how IFRS will benefit Africa’s economic

development. Will it enhance or impede African countries’ economic development?

Exploratory attempts to fill this lacuna include the works of Herbert (2010), Bova and


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


Pereira (2012), Lin (2012), Madawaki, (2012), Herbert et al. (2013), and Herbert and Tsegba

(2013). The consensus evidence from these studies is that IFRS are a good deal more

significant and challenging for DLDCs than is commonly realized. In the main, because of the greater potential growth opportunities of DLDCs, they have greater incentives for better

or improved information environment which will prospectively mitigate (a) information

asymmetry between firms and foreign investors, and (b) other egregious managerial

discretionary practices. These are some of the general governance problems which IFRS

adoption is billed to overcome.

With respect to a country’s level of preparedness for IFRS adoption, the present study seeks

to principally explore the challenges or roadblocks. Suffice it, however, to make the

following observation. Because of their quest for global competitiveness vis-à-vis the

enormous challenges of political and socioeconomic development juxtaposing the troubles

afflicting DLDCs - poverty, diseases, education and healthcare service delivery and infrastructure deficits –global issues that demand critical thinking and high level

stakeholder consultations are simply discounted at the behest of exigency to satisfy

international pressure. Most DLDCs are simply goaded to join their developed counterparts

as a matter of ‘if you can’t beat them, join them”. Some countries have simply adopted IFRS

as a matter of fulfilling membership obligation of multilateral government bodies such as

the WTO, global accounting bodies like the International Federation of Accountants (IFAC) and/or mandated by the WB and IMF, without evaluating their economic effects in their

jurisdictions. This perhaps explains the inchoate state of readiness in most DLDCs.

Nigeria’s hasty adoption experience may be somewhat shared by other SSA countries, in

particular and most DLDCs, in general.

Ex ante versus ex post assessment in policy formulation and implementation

In this section, we bring to the façade, some of the issues which have challenged or posed

an obstacle to the faithful implementation of major policies in SSA, including the IFRS. The

lessons learnt could guide other jurisdictions in their IFRS implementation plans. We wish

to emphasize the significance of ‘ex ante assessment’ in major policy implementation to

avert organizational failures. The notion of organizational failures framework is proposed and employed here to underline the efficacy of consummate implementation of policies

across the economy (macro) or within an organisation (micro) in contradistinction to

perfunctory implementation. As regards IFRS adoption, faithful implementation is the

ultimate unit of microeconomic or macroeconomic analysis.

Ex ante assessment, which exists at the time of the original decisions or negotiations (to

adopt or not to adopt, and if so, when), should be distinguished from ex post assessment,

which develops during the course of implementation (execution stage). Ex ante assessment

is characterized by careful evaluation and judgment before taking action, that is, before

policy implementation. It seeks to examine critical issues which ought to preface the

implementation of any major policy, such as IFRS adoption. At the micro level, an

enterprise needs to estimate or determine the nature, value, quality, its strengths, weaknesses, and significance of a major policy or project before embarking on it. Such a

modelling apparatus is equally warranted at the macro level before embarking on major

government policies. What is commonly referred to as the 'organizational failures

framework' exists mainly from the failure to carry out, or hasty, ex ante assessment with

depressing consequences for the economic entity or the economy.

One synoptic trajectory of ex ante assessment commonly proceeds through a comparative

assessment of the attitudes and opinions of critical stakeholders. With respect to country

adoption of IFRS, the attitudes and opinions of academics and practitioners provide an

important indication or reflection of a country's readiness. The topical issues with which the

IFRS contend are important, relevant and largely technical or idiosyncratic. Simplifying their epistemological dimensions is somewhat difficult without a proper grounding in

accounting. Such knowledge content (a) must be embedded in the accounting curricula of

tertiary educational institutions, and (b) resides in the country's academic and professional

accountants.


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


Another approach to ex ante assessment looks at the economic consequences of the

phenomenon of interest. In this context, IFRS adoption adumbrates a country's willingness

and ability to remodel its accounting rules in the manner prescribed by the IASB. Given the ubiquitous incursion of globalization in the affairs of individuals, businesses, and nation

states, remodelling the country's accounting architecture warrants a deeper look at the

effect of adoption in the country's economic development and growth. A fortiori, the joint

views of academics and practitioners are helpful in reviewing the accounting curriculum to

incorporate the emergent changes occasioned by IFRS. In this study, we seek to provide

both theoretical arguments and empirical evidence on what could impair successful adoption of IFRS in Nigeria.

The following section (Section 2) discusses some of the conceptual issues associated with

the determination to adopt, adapt or converge, as well as the drivers of IFRS. Section 3

summarizes the trajectory of IFRS adoption in Nigeria and the associated challenges. Although we defer a more complete statement of the empirical state of Nigeria’s readiness

until the next section, a sketch of the basic approach set out in Section 4 both provides an

overview of what will follow and permits some immediate application of the empirical

assessment of how prepared Nigeria was when it adopted IFRS. Section 5 presents the

methodology, data analyses and data analyses. Section 6 concludes with recommendations

and policy implications.

2. CONCEPTUAL ISSUES IN IFRS ADOPTION, CONVERGENCE AND ADAPTATION:

A Summing Up

Although IFRS has increasingly become the global need of the hour and although there have been aggressive attempts by companies in globalizing their operations, there is still some confusion over the conceptual difference between IFRS Adoption, Adaptation (or

Adaption), and Convergence. In both common parlance and extant literature, the terms are

used interchangeably, however, conceptually; there exists a significant difference between

them. While this difference is largely ignored in the literature, a sketch of the conceptual

differences will both provide an overview of the basic distinctions and permit immediate

applications of these by users of IFRS – researchers, regulators, professionals, etc. Thus, it is important to clarify this distinction in IFRS discourse.

In practice, the implementation trajectory of IFRS involves three action words, to wit: adopt,

adapt, and converge. The putative question is this: Should a country adopt, adapt or

converge? In general, although IFRS adoption is the ultimate objective and offers similarities in both challenges and benefits, however, national differences (sociocultural and

political) persist. Thus, every country/jurisdiction will inevitably follow its own path

towards achieving adoption. Clearly, many countries face cultural, legal, and/or political

obstacles to an immediate adoption of IFRS. As a result of those impediments, countries

and jurisdictions may decide to follow the path and strategies that will enable them to best

achieve the objective. A country may implement strategies of (a) immediate full adoption of IFRS, (b) continuous convergence with IFRSs, or (c) modify the standards to suit their

national peculiarities, without compromising the preparation and disclosure requirements

of IFRS. Both approaches of (b) and (c) provide necessary preparation for eventual adoption

of IFRS in the presence of hurdles to full adoption. In both cases too the country decides to

gradually bring its national standards to a point where the amounts reported in the financial statements are the same as in IFRS financial statements. In so doing, there is a

conscious realisation that the ultimate objective is to make full adoption of IFRS possible

because only then will a country avail itself of the full advantages of using the standards. In

effect, while convergence or adaptation (or adaption) may be warranted as a desideratum,

they are by no means an end, which full adoption presents.

Finally, there is a presumption that the simplest, least costly and most straightforward

option for a country is to adopt the complete body of IFRS in a single step rather than

opting for piecemeal or long-term gradual process of convergence or adaptation. To be sure,

adoption is a significant change, but the alternatives are not easier or cheaper either: in

fact, they could be more difficult and of less benefit to a country in the long run. In reality, there are four basic approaches to IFRS implementation in a jurisdiction. These include


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


processes where (a) IFRS are, by definition, fully integrated domestic accounting principles;

(b). IFRS are integrated into domestic accounting standards, using the exact words in the

IFRS, but with possibility of local jurisdiction restricting accounting provided in the IFRS and provision of additional commentary to assist implementation; (c) IFRS are incorporated

into local legislation without amendments after a formal review; and (d) IFRSs are the

benchmark towards which domestic accounting standards are moving, through a gradual

process of convergence or harmonization. These approaches are trichotomized into

adoption, convergence, and adaptation routes, as espoused above.

2.1. Drivers of IFRS

In addition to the changing landscape of business in today’s global environment, several

internal and external drivers have become a compelling force for voluntary adoption of

IFRS. The key internal drivers of interest can be summarised as follows: (i) opportunity to

streamline a disjointed financial reporting process; (ii) ability to reduce cost of statutory reporting by developing standardized training programs and to reduce third party fees

related to statutory reporting; (iii) availability and more efficient use of resources; and (iv)

opportunity to improve internal controls, since statutory reports are often prepared as a

manual conversion from national GAAP.

External Drivers of Interest in IFRS A pervasive force driving global acceptance of IFRS is the globalization of capital markets

following the increasing integration and regionalisation of national economies. There is

virtual unanimity with the proposition that a single, global set of accounting standards can

facilitate easy access to foreign capital markets, lower the cost of borrowing for companies,

attenuate the opportunistic proclivity of corporate financial reporting under weak or poorly regulated environments, and enhance the international comparability of corporate financial

reports. Another external driving force is the palpable concern that firms that adopt IFRS

will not only have first-mover advantages over non-adopters, but also create an expectation

from markets, analysts and shareholders that IFRS information is necessary and/or

required. First-mover advantage will attend to knowledge idiosyncrasy – for understanding

the principles and workings of IFRS and for acquiring during the course of their employment significant IFRS-specific skills and related task-specific knowledge. Another

driving force comes from differential national regulatory developments.

3. IFRS ADOPTION IN NIGERIA: A Summary of its historical trajectory Prior to IFRS adoption in 2012, Statements of Accounting Standards (SAS) were issued by

the Nigerian Accounting Standards Board (NASB) (now, Financial Reporting Council of

Nigeria, FRC). The defunct NASB was the Federal Government agency statutorily charged

with the responsibility of developing and issuing SAS used in the preparation of financial

statements in Nigeria. The SAS, which had many similarities with IASB standards, were

governed by Nigeria’s GAAP. The defunct NASB derived its powers from Section 335(1) of the Companies and Allied Matters Act (CAMA), 1990 until the enactment of the Nigerian

Accounting Standards Board Act No. 22 of 2003. The Nigerian GAAP consisted of

Companies and Allied Matters Act, as amended 2004; SAS issued by the NASB, Other local

legislations and industry-specific guidelines such as Banks and Other Financial

Institutions Act (BOFIA), Prudential Guidelines issued by the Central Bank of Nigeria, Insurance Act, and SEC Rules. The application of these laws, rules and guidelines in

accordance with international best practice was optional. From inception, the SAS were

patterned after IAS except in structure. In 2007, the NASB started the process of closer

harmonization with the release of SASs 25, 27, 28, 29, and 30. Altogether, the NASB issued

30 Statements of Accounting Standards (SAS) which mainly addressed financial reporting

issues affecting all major sectors of the economy. However, the SAS were never reviewed or revised to match the pace with IASB pronouncements.

The NASB was renamed the Financial Reporting Council (FRC) through the enactment of

the Financial Reporting Council of Nigeria Act No. 6, 2011. Thus, the FRC is now a unified

independent regulatory body for accounting, auditing, actuarial, valuation and corporate governance practices in both public and private sectors of the Nigerian economy (Obazee,

2014). As the IFRS blaze spread rapidly across the globe, it became inevitable that the basic


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


function of accounting standard setting was no longer tenable. National response came in

the way of new legislations that would ensure the protection of the new global financial

reporting architecture. Consequently, a number of countries - Malaysia, Mauritius, Nigeria, Republic of Ireland, the U.K, etc., - set up their Financial Reporting Council, as the

counterpart of the USA’s Public Companies Accounting Oversight Board (PCAOB).

ine of IFRS Implementation Milestones

A serious constraint in corporate financial reporting against which IFRS is designed to

militate is the perceived institutional weakness in corporate governance. The FRC was

established to, inter alia, address the institutional weaknesses in regulatory, compliance and enforcement standards and the development of robust infrastructure for monitoring

and enforcing compliance with the IFRS. The FRC Act is also meant to (a) reshape the

IFRS Competence

2010

2011

Alignment with other initiatives and training for appropriate personnel

2012

2013

Realisation and standardisation of statutory reporting

Reporting Date:

Other PIE’s

Transition

Date:

Other Public

Interest

Entities (PIE’s)

Awareness

Assessment

Legislative changes

Training

Planning/Impact analysis

Transition adjustments/ Opening BS (listed&

SPE’s)

• Transition

adjustments • Prepare

IFRS Opening Statement of

Financial Position (SFP)

• “Dry Runs” for Listed &

SPE’s • Prepare

comparative figures

• IFRS/ Quarterly

reporting by listed & SPE’s

• Audit procedures

• Investor communications

• PIE’s prepare opening SFP &

comparative figs • Dry Runs” for

PIE’s

• SME’s

commence transition

planning

IFRS/Quarterly

reporting by PIE’s • Audit

procedures

• PIE Investor communications

• Compliance monitoring for

Listed & SPE’s • SME’s prepare

opening SFP & comparative figs

• PIE/SME Investor communications

• “Dry Runs” for

SME’s

Figure 1. 2010-2014 Timeline of IFRS Implementation Milestones

Transition Date:

Listed &

Significant Public Entities

(SPE)

Reporting Date:

(Listed & significant public

entities)

Transition Date: SME’s

2014

Reporting

Date:

SME’s

• IFRS reporting by Other

SME’s • Audit

procedures • Investor

communications

• Compliance monitoring


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


national risk management system to enhance the alignment of government and private

sector responsibilities, (b) forestall the worst outcomes of and/or sanction errant

management of SPEs, and (c) economize on the bounded rationality attributes of board members in terms of increasing their competences and responsibilities.

The catalyst for change was October 22, 2009 with the inauguration of a Committee of

Stakeholders on the Roadmap to the Adoption of IFRS in Nigeria under the auspices of

NASB. The NASB’s committee submitted its report on January 26, 2010to the Federal

Government of Nigeria with the explicit recommendation that from 2012, significant public interest entities (SPEs) should comply with IFRS. Government gave its approval on July 28,

2010, with January 1, 2012 as the adoption commencement date. From then on, the NASB

set important IFRS implementation milestones, as shown in Figure 1 below. Four years

after, there is no discernible evidence of understanding of the implications of IFRS adoption

by Nigeria’s policy makers, financial regulators and many SPEs. Were this to be the case, there would have been a serious holistic attempt at upgrading the accounting curriculum

across Nigerian universities to capture the pedagogic intricacies and realities of IFRS.

Furthermore, the financial regulatory agencies’ discordant tunes towards implementing

effective compliance machinery offer a good ground for a reasonable doubt of the country’s

readiness to IFRS adoption. Their failure to assert joint responsibility and the resulting

confounding of accountability impair compliance incentives by commercial banks, insurance companies, and other SPEs.

3.1. IFRS and Corporate Governance

Can the adoption of a uniform global financial reporting framework enhance corporate

governance? Theoretically, IFRS can help to promote good corporate governance and firm performance; however, there is as yet no robust empirical evidence that this causal

relationship is quantitatively significant. Corporate governance refers broadly to the

systems or structures (internal and external) – processes, rules, regulations and control

mechanisms – that govern the conduct of an organization for the benefit of all stakeholders.

An effective corporate governance, for example, creates organizational efficiency by (a)

specifying the rights and responsibilities of stakeholders: shareholders, employees (managers and staff), and third parties; (b) balancing shareholder interests with those of

other key stakeholder groups, including customers, creditors, government and

communities; (c) ensuring that the organization operates in accordance with international

best practices and accepted ethical standards; and (d) instituting incentive and control

techniques to mitigate abuse of corporate power and other egregious frictions and distortions within the firm (Tsegba and Herbert, 2013). In short, effective or good corporate

governance is the joining of both the letter and spirit of the law (corporate governance code)

to achieve organizational efficiency.

One particular corporate governance mechanism that has received considerable attention in

the literature is the use of a monitoring board appointed by the shareholders (John and Senbet, 1998; Abdullah, 2006; Kyereboah-Coleman and Biekpe, 2006; Nguyen and Faff,

2006). However, the collapse of Enron, WorldCom, etc., and reported cases of unacceptable

accounting practices and assortments of corporate accounting fraud in many countries,

both demonstrate the limits of internal or self-regulating mechanisms and exemplify the

complexity of the monitoring task (Deakin & Konzelmann, 2004). The failure of the board (of directors) to effectively monitor entrenched management has not only refocused attention

on the composition of the firm’s ownership structure as a core governance mechanism

(Tsegba and Herbert, 2013), but has triggered regulators, policy-makers, business leaders

and investors to ponder what improvements could be made to the corporate reporting

system. Arguendo, the global adoption of IFRS may be an indication of the confidence

reposed on its capacity to mitigate internal opportunism to govern and/or to regulate executive actions, which redound to internal and external control mechanism. The response

by many jurisdictions in opting for new legislations that will unify corporate governance

practices and protect financial reporting is a prima facie evidence of the universal

agreement on the efficacy of the IFRS in these respects. For example, in the USA, there is

the Public Company Accounting Oversight Board (PCAOB), which is an independent

oversight body, answerable to the Securities and Exchange Commission (SEC), with wide


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


powers to protect public investors from potentially misleading or fraudulent uses of

accounting rules and all manner of accounting infractions. In the UK, Republic of Ireland,

Nigeria, Mauritius, Malaysia, etc., there is the Financial Reporting Council (FRC), which is an independent regulatory body responsible for promoting high quality corporate

governance and reporting to foster investment.

The nexus between corporate governance and IFRS stems from the need to enhance the

value of a company through ethical, transparent and accountable corporate practices.

Further, it is expected, a fortiori, that IFRS implementation will curtail the ‘expectation gap’ problem associated with different countries having different financial reporting standards

with the concomitant effect on corporate management and corporate reporting vis-à-vis

stakeholders’ expectations. The primacy of this nexus is attributed to four related factors (a)

the increasing incidence of corporate fraud and corporate collapse on a previously

unimagined scale; (b) the dominance of the corporation in modern business, occasioned principally by privatization and consolidations; (c) the collapse of socialism and centralized

planning; and (d) opportunistic proclivity of corporate executives and boards. Besides, since

fiat cannot easily be invoked where equity issues are at stake, the IFRS constructively

serves as norms of internal justice, which emphasize accountability, support quasi moral

involvement, check attempts at vigorously implementing the compliance machinery, and

establish a reasonable doubt by asserting joint managerial responsibility.

Although internal auditing serves to check egregious distortions, the board is nevertheless

severely limited in information impactedness respects. It is simply prohibitively costly or,

perhaps for bounded rationality reasons, infeasible, for the board of directors to be apprised

of everything that goes on at the operational level. The increasing global adoption of IFRS is an eloquent indication of the confidence reposed on its internal and external control

mechanism and disclosure threshold to mitigate the agency costs, internal opportunism

and internal distortions of subgoal pursuit – where by subgoal is implied a strategic, not

instrumental, effort or behaviour to manipulate the (accounting) system to promote

individual and/or collective interests of the affected managers (see, Herbert, 1995). The

confounding of transparency and accountability in developing countries impairs incentives because of weak legal systems and capital markets which, in turn, increase risk and cost of

capital and depress asset values. Consequently, it is plausible for firms to limit transaction

costs in such scenarios (weak legal systems and inefficient capital markets) by adopting a

uniform financial reporting framework.

Further, the control potential of IFRS is rooted in the wealth gain achievable through more

effective monitoring of managerial performance by firm owners and stakeholders. If the

market for corporate control and managerial labour market perfectly aligned the interest of

managers and shareholders, then control potential would play no role in explaining

corporate governance structure but, in the presence of costs of maintaining corporate

control, the market imperfectly disciplines corporate managers who work contrary to the wishes of shareholders (Demsetz and Lehn, 1985). A uniform global financial framework is

an increasingly influential form of corporate governance. The instrumentality of IFRS can

discipline entrenched managers towards corporate productivity and efficiency, social

welfare, value maximization, and accountability of corporate executives. The IFRS and the

FRC’s enhanced regulatory and oversight powers will prospectively attenuate the frictions associated with egregious management behaviour and boost management credibility. For

investors and lenders, the global financial reporting framework engenders better, improved

and internationally comparable disclosure. This assures more relevant information to make

sound investment decisions, risk assessment, lower cost of capital, and improve access to

new capital and higher share values.

3.2. Challenges to IFRS Implementation

The implementation of IFRS provokes a plethora of development issues and challenges. The

leading candidates can be compactly summarized under three categories, namely: bounded

rationality challenges, process challenges, and technical challenges.


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


Bounded rationality Challenges: These are mainly deposited in the firm’s staff and involve

their capacity to take on idiosyncratic skills and competencies required by IFRS. Technical

capacity is a basic requirement for effective implementation of IFRS. “Countries that

implement IFRS face a variety of capacity-related issues, depending on the approach they take. One major challenge encountered in the implementation process is the shortage of

skilled accountants and auditors who are technically competent in implementing IFRS and

ISAs” (United Nations, 2008). Where the firm’s human resources are limited in knowledge,

skill, foresight and time, these will have implications for the achievement of human purpose

and for economic organization of IFRS. In this regard, inadequate internal staff, poor resource deployment, change management issues, inadequate training, inadequate top

management and board support, and poor incentive structure, are bounded rationality

challenges inherent in human behaviour. Juxtapose these with uncertainty and complexity

of business, bounds on rationality become further stretched.

Process challenges are usually resident in the nature of enterprise and business

performance. IFRS implementation in an environment of poor business performance is bound to be prolonged or fail totally. Technical challenges are related to both bounded

rationality and process management. Transactional disabilities are implicit in the presence

of scarce resources, poor skills functionality and poor application management. Process and

technical impediments also resonate with the intricacies of IFRS technical accounting

standards, the overlap of local and international regulatory considerations, the required conversion across business units and countries, and the level of information technology (IT)

infrastructure required in the organization and the dearth of IT professionals with IFRS

technical knowledge who can interpret and translate IFRS into IT changes. An organization

that lacks men of resource will invariably lack the ability to deal resourcefully with unusual

problems.

A proper implementation plan should begin with an evaluation of the firm’s internal

organizational strengths, skills and weaknesses in terms of availability and capacity of

human resources. IFRS implementation introduces complexity into the accounting

environment and the firm may be required to progressively improve its internal controls as

a first step. A seamless transition to IFRS platform must overcome these challenges. Both government and many Nigerian companies underestimate the level of technical expertise

required to transit to IFRS. IFRS requires idiosyncratic skills, and these are in short supply.

Because it demands basic understanding of accounting, a successful implementation

requires a lot of training and re-orientation for all professional accountants in Nigeria. IFRS

is complex and requires huge resources in both finance and time respects for intensive

skills training and acquisition, and to recalibrate organizational systems and processes. Given the country’s acute infrastructure deficits, the transition challenge is certainly

beyond what many SPEs bargained for, which explains why most of them are finding

implementation very daunting and arduous.

3.3. IFRS Education and Training: How Prepared Was Nigeria? The IFRS represent a unified global commitment to developing a single set of high quality,

global accounting standards whose aim is to provide transparent and comparable

information that is in the public interest through general purpose financial statements

(Herbert, 2010). This commitment has led to a growing acceptance of IFRS as a basis for

financial reporting across the world. The momentum represents a fundamental change for

both national and global accounting systems and professions. Aspects of national systems that are critical to a successful transition to IFRS include the tertiary educational system

and the accounting profession. Important components of the former (that is, the tertiary

education system) for IFRS implementation are accounting lecturers and students who, in

various contexts, complement the accounting profession in the development of accounting

practice. Thus, the IFRS have been accepted around the world, including Nigeria, as a common accounting and financial language (ibid). Indeed, Nigeria had in 2010 signaled its

willingness to adopt the IFRS in 2012. This date line was anchored on the understanding of

a progression along the milestones and timelines enunciated in the Country Roadmap.

However, as the FRC, formerly Nigerian Accounting Standards Board (NASB), duly


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


acknowledged, the transition framework for effective and meaningful adoption may be

derailed if any of the milestones and timelines is ignored.

IFRS adoption reflects a fundamental shift in national accounting systems and professions.

Critical constituents of a national system for a successful transition to IFRS include the

tertiary educational system and the accounting profession. On this premise, the joining of

anecdotal evidence with the paucity of published research about the dimensions of IFRS

adoption in Nigeria tends to suggest that not much is known about this new financial

language in the Nigerian academic environment and even in the world of work. Two key questions are critical in this conclusion. (a) How prepared are the companies, accounting

educators and professionals for IFRS adoption? (b) To what extent is the gap in knowledge

bridged by academics through IFRS curriculum development and professional

development? To be sure, the transition to IFRS and its implications for preparers and

users of financial statements, regulators, professionals, academics, and other stakeholders are yet to be adequately assessed empirically in Nigeria. As the FRC acknowledged in its

roadmap, the implementation of IFRS requires considerable preparation both at the country

and entity levels to ensure coherence and provide clarity on the authority that IFRS will

have in relation to other existing national laws (NASB, 2010).

Effective implementation of IFRS demands considerable and adequate technical capacity among preparers, users, auditors, regulatory bodies, investors and even the public. The

state of preparedness of knowledge in any field of learning can be gauged through the

degree of its familiarity at both the academic and professional levels. Thus, if a given

knowledge base is sustained through programmes of academic and professional study, a

presumption of systematic effort towards understanding the content and practice of the phenomenon can reasonably be made. Put differently, a comparative analysis of a country’s

academics and practitioners views on the subject matter provides an insight into the state

of its readiness for IFRS adoption.

4. EMPIRICAL ASSESSMENT OF STATE OF IFRS READINESS IN NIGERIA While there has been considerable research on the effects of IFRS adoption, there is

relatively little or no systematic study on the antecedents of IFRS adoption in Nigeria. In

other words, what informed what may be characterised as Nigerian Government’s ‘hurried’

adoption of IFRS from January 2012, when even the most advanced or sophisticated

economy, the U.S. is still studying the implications for its economy? Put differently, why did the Federal Government of Nigeria adopt IFRS without ex ante assessment of the country’s

state of readiness and/or the economic consequences thereof? In two related studies,

Herbert and Tsegba (2013) and Herbert et al. (2013) sought to assess the extent to which

major Nigerian stakeholders, such as accounting academics and professionals, are familiar

with and ready for IFRS as well as their perception of the benefits and challenges of

adoption. These studies also touched on IFRS education and the role of training and information technology. Because each country has its own set of rules or standards guiding

the preparation of financial statements – although there are commonalities among groups of

countries, as with former British colonies that tended to adopt, mutatis mutandis, the

Anglo-Saxon accounting standards – to a large extent, it has been difficult to synchronize

these.

As Herbert et al. (2013) posit, the joint views of academics and practitioners are helpful in

reviewing the accounting curriculum to incorporate important emergent changes of the

kinds occasioned by the IFRS. Global synthesis of international accounting and financial

reporting standards cannot do justice to the peculiar characteristics and circumstances of

the various countries covered. Earlier, Herbert and Wallace (1996) had noted that only a survey of specific country studies could provide an in-depth understanding of the

accounting situation. Such may be pursued through a survey and collection of data on the

perception of academics and practitioners regarding familiarity, readiness, challenges or

roadblocks, and proper implementation plans of IFRS adoption. Such a survey is needed

because (a) the concerns of critical stakeholders (academics and practitioners) on the relevance of extant IFRS research, and (b) their views on IFRS research agenda might help

to suggest new emphasis and new directions for seamless country adoption.


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


5. METHODOLOGY, DATA ANALYSIS AND RESULTS

The sample used in this study is a 105-respondent random subsample of the sample in the original Herbert et al.’s (2013) study. The latter sought to elicit the respondents’ views on a

variety of IFRS adoption issues in Nigeria. The accounting lecturers were randomly selected

from federal, state and private universities located in the South-East and South-South

zones of Nigeria. Also, the respondent practitioners were randomly selected from

accountancy/auditing firms, banks, finance and insurance firms in the same geopolitical

zones of the country. The respondents’ views were sought on three major issues: (1) the extent of their familiarity with, and sources of awareness of, IFRS; (2) Nigeria’s readiness to

embrace IFRS, and (3) the obstacles towards IFRS implementation.

The present study follows a similar one conducted in the U.S.A by Rezaee, Smith and

Szendi (2010) and Moqbel and Bakay (2010). Replication research is important to the future

of world economy because different national contexts (developed and developing countries

alike) of IFRS, or any phenomenon of global interest, help to define the status of education

and practice of accounting and financial reporting, or the focus of interest. They help to

identify global IFRS topics of interest and support globalization of IFRS curricula and practice. They also help to build a literature on comparative national issues on IFRS, which

are presently scanty although there is a growing literature on international financial

reporting. The chi-square test of independence was used to test for differences in responses

involving categorical dependent variables for the between subject analysis. The Kruskal-

Wallis (K-W) test was used to examine differences in responses in the ranked data. The K-W test was also performed to investigate demographic differences in the responses.

Table 1 provides the respondents’ demographic profile. The respondents are somewhat

matched with respect to gender. Most of them are young, with over five years’ experience in teaching accounting in the university and are qualified to express opinions - being in

possession of either B.Sc. or in conjunction with professional accounting qualification

(ANAN or ICAN). Over 15% of them have higher degrees in Accounting or Accounting related

fields.

Table 1. Demographic Profile of Study Sample

Questionnaire administration Sent Returned Percent

Industry Classification

Academics (Federal, State & Private Universities) 60 33 55

Practitioners (Accountancy & auditing firms, banking & finance, etc. 140 70 50

Total 200 103 51.5

Gender Frequency Percent

Male 55 53.4

Female 48 46.6

Total 103 100.0

Age

21-30 53 51.4

31-40 22 21.4

40+ 28 27.2

Total 103 100.0

Work Experience

1-4 years 19 18.4

5-10 years 32 31.1

Over 10 years 52 50.5

Total 103 100.0

Education & Qualification

Bachelor’s Degree 42 40.8

Master’s 9 8.7

PhD 7 6.8

Bachelor’s + Professional Qualification 45 43.7

Total 103 100.0


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


Table 2 reports the extent to which the sampled Nigerian academics and practitioners

displayed their familiarity with IFRS. As might be expected, accounting academics (with a

mean of 4.28) are more familiar with IFRS than practitioners (mean of 4.00) on the 5-point Likert scale. However, the K-W test of the null hypothesis of no significant difference

between Nigerian academics versus practitioners regarding the extent of IFRS familiarity

(that is, their mean responses are the same) is rejected. The high significance level indicates

that there is certainly a true difference in the extent of familiarity with IFRS by academics

and practitioners in the population from which the sample was drawn.

Table 2. Extent of Familiarity with IFRS by Nigerian Academics and Practitioners

Academics Practitioners

Mean Std Mean Std K-W

Response Dev. Response Dev. Chi-Sq.

Anchor scales range from: = 4.2778 .4609 4.000 .9877 .000

(1=- Not familiar to 5 = Very familiar)

A further test was carried out along the line of Moqbel and Bakay (2010). Here, the levels of

IFRS familiarity by academics were collapsed and dichotomized into: Familiar and

Unfamiliar. The reason for this dichotomy is to consolidate and compare the levels of academics’ familiarity with practitioners, as was done in the above U.S. study. The chi-

square test of no significant difference between academics and practitioners was also

rejected. This finding corroborates the U.S. study where the respondents were also found to

be largely unfamiliar with IFRS.

Table 3 is designed to explore the familiarity level more deeply in terms of source of familiarity. Both the academics and practitioners have heard of IFRS, however, the

differences in their responses were not statistically significant. Respondents who claimed

familiarity with IFRS were asked about their source. Table 3 reveals that an overwhelming

majority (77.1%) became aware of IFRS from professional lectures, workshops and

seminars. The next source of IFRS awareness – a distant second - is the news media (16.9%), while other sources such as the internet were surprisingly negligible, given the

growing ubiquity of internet as information and knowledge medium.

Table 3. Source of Awareness

Source/ News media Lectures/Professional

Respondent Development Internet/Others Total

Academics 8 29 4 41

Practitioners 6 35 1 42

Total 14 64 5 83

Percentage 16.9% 77.1% 6.0% 100%

The IFRS awareness disparity between academics and practitioners reveals an underlying

lacuna in the state of readiness by relevant Nigerian institutions and stakeholders. Table 4

reports that most of the respondents indicated that Nigeria was not ready for IFRS

adoption. The results show that the respondents do not have different perspectives

regarding the state of readiness of IFRS adoption in Nigeria. This finding represents the average view of most Nigerians regarding the country’s haste towards IFRS adoption.

Table 4. Extent of Readiness for IFRS Adoption


Mean Std Mean Std K-W

Response Dev. Response Dev. Chi-Sq.

State of readiness of IFRS Adoption 3.611 1.290 3.643 1.144 .000

(1= not ready to 5 = very ready)


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


We seek the perspectives of academics and practitioners regarding a proper plan to

transition to IFRS. Precisely, do critical Nigerian stakeholders have different perspectives

about Government’s transition plan for public sector entities? Table 5 reports that a proper plan to transition Nigerian SPEs to IFRS must begin with proper educational alignment to

create nationwide systemic awareness through systematic introduction of IFRS in

accounting curriculum in Nigerian educational system. About 42 percent of the

respondents feel this should have been the number one priority plan. IFRS education and

training for management is next on the respondents’ transition agenda. This is mainly

achieved through workshops, seminars, conferences or other structured training programmes. The differences in responses between accounting academics and practitioners

were tested and found not to be statistically significant, thus leading to acceptance of the

null hypothesis.

Table 5: Respondents’ Perspectives on Plan to Transition Nigerian Companies

A Proper Plan to Transition Nigerian Companies Requires

IFRS Training

for Investors

IFRS Training

for Auditors

IFRS Training

for Management

IFRS Course in

Accounting

Curriculum Total

Lecturers

Practitioners 10 (71.4%) 13 (72.2%) 15 (51.7%) 23 (54.8%) 61(59.2%)

4 (28.6) 5 (27.8%) 14 (48.3%) 19 (45.2%) 42(40.8%)

14 (13.6%) 18 (17.5%) 29 (28.1%) 42 (40.8%) 103 (100%)

5.2. Impediments to IFRS Adoption

The four major obstacles to IFRS adoption in Nigeria are in this order: (i) Lack of education,

understanding and experience by preparers of financial reports; (ii) Lack of coverage of IFRS

in financial accounting/auditing textbooks; (iii) Initial cost of adoption; and (iv) Transition plan and issues pertaining to IFRS. Over all, there is a consensus among academics and

practitioners on the factors that severely impede IFRS adoption, even though the null

hypothesis of no significant differences in their assessment is rejected for all the factors.

Table 6. Comparative Assessment of Severity of Impediments to Adoption: Academics vs. Practitioners

Severity of perceived obstacles to IFRS convergence Academics Practitioners (1=Not Severe; 5=Very Severe) Severe Not Severe Not Avg K-W

% Severe % Severe Rank Chi-Sq.

(Rank) % (Rank) %

Initial cost of convergence 89.5 10.5 71.8 28.2 5 .000

(2) (6)

Required changes in auditing standard 74.5 25.5 73.9 26.1 6 .000

(7) (5)

Perceived uncertainties about IFRS. 75.0 25.0 69.5 30.5 7 .000

(6) (7)

Lack of sufficient involvement of global regulators 86.9 13.1 76.1 23.9 4 .000

in the IASB standard setting process (4) (4)

Transition plan and issues pertaining to IFRS. 83.0 17.0 84.1 15.9 3 .000

(5) (2)

Lack of education, understanding & experience by 94.8 5.2 84.8 15.2 1 .000

preparers of financial reports with the use of IFRS (1) (1)

Lack of coverage of IFRS in financial accounting 88.2 11.8 82.6 17.4 2 .000

Textbooks (3) (3)

Our findings are largely consistent with those of Moqbel and Bakay (2010). The evidence

from these studies suggest the need for a reassessment of accounting education and

training curricula in order to enhance the teaching and learning of IFRS. In general, SSA countries and companies can appropriate the learning experience of other countries such

as USA, South Africa and the European Union. An ideal preparatory ground would have

been for their tertiary educational institutions and professional accountancy bodies to


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


embed IFRS into their curricula as a prelude to IFRS adoption. This is the path being

treadled by the U.S., although the U.S. argument for this trajectory has more to do with

national pride and politics than technical considerations. The point being canvassed here is that a more systematic preparation is warranted when both the tenets of IFRS are not well-

understood and the country’s educational system and accounting professionals are ill-

equipped.

Table 7: Comparative Assessment of Attitudes towards IFRS Adoption: Academics Vs. Practitioners


Level of Agreement with the following statements Mean Std Mean Std K-W

(1= Strongly Disagree to 5 = Strongly Agree Dev. Dev. Chi-Sq.

I have interest in IFRS 4.5000 .5145 4.1667 .5809 .000

I know the IFRS well 3.8889 .7584 3.8810 .7392 .973

Many companies are preparing well to adopt the IFRS 3.6667 .9075 3.5714 .8595 003

IFRS adoption will affect financial performance 4.2222 .7321 3.8810 .8025 .000

IFRS adoption will affect operating performance 4.2778 .7519 3.9048 .7905 .000

IFRS will affect stakeholders such as investors or shareholders 4.1111 .7584 4.1190 .7715 .000

IFRS must be offered as a core curriculum in tertiary education4.3333 .7670 4.0714 .9472 .002

Will you be willing to take a course in IFRS if one is offered 3.9444 .9376 4.0000 .8264 .048

in the university?

5.3. Attitudes towards IFRS Adoption We then seek to gain further insight into the attitudes of respondents towards IFRS

adoption with a view to validating our earlier findings. Table 7 indicates a high level of

unanimity among academics and practitioners on the following issues: (1) interest in IFRS;

(2) offering of IFRS as a core curriculum in tertiary education; and (3) the way IFRS will

affect investors or shareholders. The respondents are also united in their ambivalence

towards the level of IFRS preparation. Overall, the results provide affirmative conclusions concerning the respondents’ attitudes towards IFRS adoption.

6. CONCLUSION

There is a growing acceptance of IFRS as a basis for financial reporting across the world. This momentum represents a fundamental change for both national and global accounting

systems and professions. Since establishment, the number of countries that require or

allow the use of IFRS for the preparation of financial statements by publicly held companies

has continued to increase. A systematic dialogue with critical stakeholders should have

prefaced Nigeria’s adoption of IFRS in order to establish an understanding of the

trajectories of convergence into one global financial reporting language. Comparability of financial reporting which IFRSs offer is the underlying rationale for adoption of or

convergence towards a single set of standards. The expectation that the efficiency and

competitiveness of global financial markets is facilitated by IFRS adoption must be

circumscribed, strengthened and validated by systematic empirical investigation in different

countries and jurisdictions.

Despite the 2012 IFRS adoption, there is overwhelming evidence that Nigeria was never

prepared even to date. Anecdotal evidence suggests that by 2014, not all the financial

regulatory agencies, most banks, insurance companies and institutions of higher learning

have the operational framework to support IFRS implementation, two years after the

country adopted the standards. That is the clearest evidence of the country’s state of unpreparedness for IFRS adoption. This parlous situation underscores the importance of ex

ante assessment of major policies before implementation. A more worrisome development is

the haste with which Nigeria adopted IFRS without consultation with key stakeholders,

such as tertiary institutions, professional bodies and the business community. Closely

related is the assessment of the attitudes of academics and practitioners towards the subject matter. The question remains whether the 2012 adoption date was feasible due to

the implementation challenges and the level of unpreparedness prior to and till date.


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


6.1. Recommendation and Policy Implications

Even though Nigeria has adopted IFRS, empirical studies have thrown up reservations and

roadblocks to its implementation. An important policy implication is the urgency of accounting curriculum review in the tertiary education system to incorporate IFRS and

IPSAS and their implementation dimensions. Also, governments at all levels, regulatory

agencies, accountancy bodies, private and public companies and institutions, and

accountancy firms all need to fast-track IFRS education in order to boost the acquisition of

IFRS knowledge and competences.

REFERENCES

Abdullah, S. N. (2006). Board Composition, Audit Committee and Timeliness of Corporate Financial Reports in Malaysia. Corporate Ownership and Control, 4(2): 33-45.

Ball, R. (2001), “Infrastructure requirements for an economically efficient system of public financial reporting and disclosure”, Brookings-Wharton Papers on Financial Services:

127–169. Barth, M. E., Landsman, W.R. & Lang, M.H. (2008). International Accounting Standards

and Accounting Quality, Journal of Accounting Research 46: 467-728.

Bhasin, M. L. (2013). Corporate Governance and Forensic Accountants’ Role: Global Regulatory Action Scenario, International Journal of Accounting Research, Vol. 1(1):

1-19. Bova, F., and Pereira, R. (2012). The determinants and consequences of heterogeneous

IFRS compliance levels following mandatory IFRS adoption: Evidence from a developing country. Journal of International Accounting Research, 11(1), 83–111.

Daske, H., Hail, L., Leuz C. and Verdi, R. (2008). Mandatory IFRS Reporting Around the World: Early Evidence on the Economic Consequences, Journal of Accounting Research 46, 1085 – 1142.

Deakin, S. and Konzelmann, S. J. (2004). Learning from Enron. Corporate Governance,

12(2): 134-142.

Demsetz, H. & Lehn, K. (1985). The Structure of Corporate Ownership: Causes and Consequences. Journal of Political Economy, 93:1155-1177.

Doidge, C., G. A. Karolyi, and R. M. Stulz. (2004). Why are foreign firms listed in the U.S. worth more?, Journal of Financial Economics 71: 205–238.

Herbert, W. E. (1995), Alternative Strategies to Foreign Investment, (Ann Arbor, MI: UMI).

Herbert, W. E. (2010). Adoption of IFRS in Nigeria: Assessing the Level of Preparedness. A

Paper presented at FSS2020 Retreat on IFRS, CBN Head Office, Abuja, 13

December. Herbert, W. E. Wallace, R. S. O. (1996). A Corporate View of Research Needs in Corporate

Finance. Accounting and Business Research, 26(2), 107 – 124.

Herbert, W. E. and Tsegba, I. N. (2011). Corporate Governance and Firm Performance through Ownership Structure of Nigerian Listed Companies. Journal of Business and Financial Studies, 3(1), 1-27.

Herbert, W. E. and Tsegba, I. N. (2013), Economic Consequences of International Financial Reporting Standards (IFRS): Evidence from a Developing Country. Research Journal of Finance and Accounting, 4(6): 121-135.

Herbert, W. E., Tsegba, I. N., Ohanele, A. C., and Anyahara, I. O. (2013). Adoption of

International Financial Reporting Standards (IFRS): Insights from Nigerian Academics and Practitioners. Research Journal of Finance and Accounting, 4(6),

121-135. International Federation of Accountants (2008). Global Survey Recognizes Profession’s Role

in Contributing to Economic Growth and Highlights Need for More Accounting Talent.

Available at http://www.ifac.org/globalsurvey. John, K. and Senbet, L. W. (1998). Corporate Governance and Board Effectiveness. Journal

of Banking and Finance, 22:371-403.

Judge, W., Li, S. and Pinsker, R. (2010). National Adoption of International Accounting Standards: An Institutional Perspective. Corporate Governance: An International Review, 18(3), 161–174.

Khor, M. (2005), Globalization and the South: Some Critical Issues, (Malaysia: Third World

Network).

http://www.ifac.org/globalsurvey

http://onlinelibrary.wiley.com/doi/10.1111/corg.2010.18.issue-3/issuetoc


ISSN: 2047-2528 Vol. 3 No. 12[25-41]


Kyereboah-Coleman, A. and Biekpe, N. (2006). The Relationship between Board Size, Board

Composition, CEO Duality and Firm Performance: Experience from Ghana.

Corporate Ownership and Control, 4(2): 114 – 122. Li, S. (2010). Does mandatory adoption of international financial reporting standards in the

European Union reduce the cost of equity capital?. The Accounting Review, 85 (2):

607-636.

Lin, S. (2012). The Determinants and Consequences of Heterogeneous IFRS Compliance

Levels following Mandatory IFRS Adoption: Evidence from a Developing Country. Journal of International Accounting Research 11 (1): 113-118.

Madawaki, A. (2012). Adoption of International Financial Reporting Standards in Developing Countries: The Case of Nigeria. International Journal of Business and Management, 7(3), 152-61.

Moqbel, M. and Bakay, A. (2010). Are US Academics and Professionals Ready for IFRS?.

Available at SSRN:

http://ssrn.com/abstract=1662162or doi:10.2139/ssrn.1662162 Nigerian Accounting Standards Board (2010). Report of the Committee on Road Map to the

Adoption of International Financial Reporting Standards in Nigeria. (Lagos: FGN). Nguyen, H. and Faff, R. (2006). Impact of Board Size and Board Diversity on Firm Value:

Australian Evidence. Corporate Ownership and Control, 4(2): 24 – 32. Nobes, C. and Parker, R. (2008), Comparative International Accounting, Prentice Hall.

Obazee, J. O. (2014). Overview of the Financial Reporting Council of Nigeria Act No. 6, 2011

and Its Implication for National Universities Commission and Nigerian Universities.

A paper presented at the National Implementation Workshop on Adoption of IFRS & IPSAS in Nigerian Universities held at the National Universities Commission (NUC)

Secretariat, Maitama, Abuja, 12-17 May, 2014.

Rappaport, A. (1977). Economic Impact of Accounting Standards – Implications for the FASB. The Journal of Accountancy, May: 89-98.

Rezaee, Z., Smith, M., and Szendi, Z. (2010). Convergence in Accounting Standards: Insights from Academicians and Practitioners. Advances in Accounting, 26 (1): 142-

154. Watts, R. L. (1977). Corporate Financial Statements, a Product of the Market and Political

Processes. Australian Journal of Management: 53-75.

Watts, R. L. And Zimmerman, J. (1986). Positive Accounting Theory. (Englewood Cliffs, NJ:

Prentice-Hall).

Documents

Globalization of Financial Reporting: Obstacles to ...ajbms.org/articlepdf/2ajbms05201403122839.pdf · Globalization of Financial Reporting: ... (IFRS) Adoption in Nigeria Wilson