Finance

7 Functions of the Financial Reporting Council of Nigeria

Here in this post, we are going to bring to you 7 functions of the financial reporting council of Nigeria. we hope you find this information useful.

The Financial Reporting Council of Nigeria is a regulatory organization. Formally, the Council was called, the Nigerian Accounting Standards Board.

In fact, it was this organization, the Nigerian Accounting Standards Board that sets the accounting standards in Nigeria.

There was a huge improvement, when the Nigerian Accounting Standards Board changed its name to what we have today, and known as the Financial Reporting Council of Nigeria.

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7 Functions of the Financial Reporting Council of Nigeria
Financial Reporting Council of Nigeria – Photo Source: http://www.theparadigmng.com

One may wonder as to, what improvement the change of the name of the Council has brought to the country. Obviously, this improvement is reflected on the current functions of the Financial Reporting Council of Nigeria. For instance, the Nigerian Accounting Standards Board Act of 2003 has been repealed.

Hence, the Financial Reporting Council of Nigeria has to inherit some of the duties, and responsibilities, and functions formally carried out by the Nigerian Accounting Standards board.

It is true that any regulatory organization in Nigeria cannot be allowed the function, except there is proper legal documents.

Though the Nigerian Accounting Standards board has had these documents, the name of these documents bear the Financial Reporting Council of Nigeria Act of 2011, because the former name of the Council was changed. Having said that, we will be looking at these functions of the Financial Reporting Council of Nigeria in this article.

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What Are The Functions Of The Financial Reporting Council Of Nigeria?

There are numerous functions assigned to the Financial Reporting Council of Nigeria, when the Nigerian Accounting Standards Board Act of 2003 was repealed hence, the new Act of 2011 has to create the Financial Reporting Council of Nigeria and the new Council, the Financial Reporting Council of Nigeria had to inherit some of the functions of the Nigerian Accounting Standards Board.

These functions of the Financial Reporting Council of Nigeria are going to be discussed in this article. Below are the functions of the Financial Reporting Council of Nigeria:

1. Develops Accounting And Financial Reporting Standards

One major function of the Financial Reporting Council of Nigeria has been to make sure that, it develops accounting and financial reporting standards.

This aspect of the function of the Financial Reporting Council of Nigeria was very necessary and important since these standards were to be seen and observed by those public entities with a view the publishing their own financial reports and financial statements.

2. Reviews And Promotes And Enforces Standards Of Accounting

Yet, another function of the Financial Reporting Council of Nigeria is to make sure that, it reviews the standards of accounting, and also, that of the financial reports, and this is done to every organization within the country.

Away from reviewing of the accounting standards and financial reports to these organizations, the Financial Reporting Council of Nigeria must have to promote the standards of accounting and financial reports of these organizations, and as well, enforces the standards of accounting and financial reports of every one of this organization.

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3. Receives Notes From Third Party About Non-Compliance

This is another function of the Financial Reporting Council of Nigeria, and this has to do with treating non-compliance to its standards.

Having reviewed, and promoted, and as well enforced the standards of accounting and financial reports, the Financial Reporting Council of Nigeria will also receive notes that come from the third parties, concerning non-compliance to its standards of accounting and financial reports.

On receiving of these notes about non-compliance, the Financial Reporting Council of Nigeria will have to treat them accordingly.

4. Receives Copies Of Annual Financial Reports

Financial reports annually are sent to the Financial Reporting Council of Nigeria. This is part of its functions. The Financial Reporting Council of Nigeria will have to make sure that, it receives copies of annual financial reports that come in from public entities.

And these copies of annual financial reports from the public entities are treated by the Financial Reporting Council of Nigeria within 60 days interval.

It is within these number of days that the Financial Reporting Council of Nigeria will have to decide whether or not to approve, and or to disapprove these copies of annual financial reports from the public entities.

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5. Provides Advice To The Federal Government About Accounting And Financial Reports

As a regulatory organization, the Financial Reporting Council of Nigeria also serves as an advisory body, when it comes to issues relating to financial and accounting reports and statements.

For instance, government and other organizations, are in most cases, do need advice particularly, when it has to do with issues of accounting and financial reports.

That is why one of its functions is anchored on advising government and organizations on financial accounting issues.

Take, for example, the federal government of Nigeria and even the states government in the country have benefited from the Financial Reporting Council of Nigeria’s advice on issues that are related to financial and accounting reports.

6. Maintains Professionals’ Registration In Accounting Field

Every professional organization do register its practicing members. It is perhaps, its way of licensing its professional members to practice the profession in Nigeria.

However, the Financial Reporting Council of Nigeria is not exempted from this practice. One of the key functions of the Financial Reporting Council of Nigeria is in the maintenance of the registration of every practicing member in the field of accounting, particularly, the accounting field has relation to the process, where financial reports are created.

7. Promotes Standards Of Accounting Issued By International Accounting Standards Board

Standards in financial and accounting reports have always been a hallmark to the Financial Reporting Council of Nigeria, and maintaining and promoting these standards remained one key function of the Financial Reporting Council of Nigeria.

That is why, the Council has been engaging in promoting these standards of accounting, this time, those ones that the International Accounting Standards Board are issued, and those other ones issued by the International Federation of Accountants.

More so, in Nigeria for example, the Financial Reporting Council of Nigeria has in effect, provided adaptation of the international standard here in this country.

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Conclusion

There was a huge improvement, when the Nigerian Accounting Standards Board changed its name to what we have today and known as the Financial Reporting Council of Nigeria

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Joseph Athanasius

Joseph Athanasius is a Content Developer at InfoGuideNIgeria.com. InfoGuide Nigeria is a team of Resource Persons and Consultants led by Ifiokobong Ibanga. Page maintained by Ifiokobong Ibanga. If you need a personal assistance on this topic, kindly contact us.

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