Topics: Balance sheet, Generally Accepted Accounting Principles, Financial statements Pages: 7 (1788 words) Published: June 26, 2014
It is often said that an organization without an accountant is not a serious organization as it has no credibility. This is because the accountant is seen as the financial “gatekeeper” whose presence within an establishment underlines a commitment to sound financial principles and good business values. It is known that almost all aspect of human activities have undergone changes globally as a result of improvements in hi-tech Information and Communication Technology. Similarly, there is need for accountants to take a critical look into the present practice of the accounting profession with a view to fastening out appropriate strategies for meeting up with future challenges; one of such change is the introduction and implementation of the International Financial Reporting Standards (IFRS). International Financial Reporting Standards (IFRS) are designed as a common global language for business affairs so that company accounts are understandable and comparable across international boundaries. They are a consequence of growing international shareholding and trade and are particularly important for companies that have dealings in several countries. They are progressively replacing the many different national accounting standards. The rules to be followed by accountants to maintain books of accounts which is comparable, understandable, reliable and relevant as per the users internal or external. Financial statements are a structured representation of the financial position and financial performance of an entity. The objective of financial statements is to provide information about the financial position, financial performance and cash flows of an entity that is useful to a wide range of users in making economic decisions. Financial statements also show the results of the management's stewardship of the resources entrusted to it. To meet this objective, financial statements provide information about an entity's: (a) assets; (b) liabilities; (c) equity; (d) income and expenses, including gains and losses; (e) contributions by and distributions to owners in their capacity as owners; and (f) cash flows. This information, along with other information in the notes, assists users of financial statements in predicting the entity's future cash flows and, in particular, their timing and certainty. The IFRS Objective

IFRS to be:

The single set of accounting standards
Used worldwide
Providing high-quality,
Transparent and comparable information
For investors and other users of financial information
Benefits of IFRS
Improved quality of reporting
Improved transparency and investor confidence
Reduced accounting complexity
Potential process and cost efficiencies
Process and Technology optimization

IFRS adoption roadmap in Nigeria

On Wednesday, July 28, 2010, the Federal Executive Council accepted the report of the Roadmap Committee and approved January 1, 2012 as the effective date of transition to IFRS in Nigeria. Our national accounting standard (SAS) is partly based on old IAS, some of which have been amended or withdrawn by IASB. The local standards do not cover all the aspects of financial reporting encountered by preparers of financial statements. Some SAS are out of date and are not sufficiently comprehensive to form a basis for preparation of high quality financial statement. So there is an urgent need for the convergence of our local standards to IFRS.

A Statement of Financial Position
A Statement of Comprehensive Income separate statements comprising an Income Statement and separately a Statement of Comprehensive Income, which reconciles Profit or Loss on the Income statement to total comprehensive income A Statement of Changes in Equity (SOCE)

A Cash Flow Statement or Statement of Cash Flows
Notes, including a summary of the significant accounting policies Comparative information is required for the prior reporting...
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