The Framework – What’s It For? The Framework exists to help the International Accounting Standards Board (IASB) create and update International Financial Reporting Standards (IFRSs) that are consistent and logical. It also guides accountants in coming up with accounting policies for areas that aren’t covered by existing standards or where they have a choice to make. Plus, it helps everyone understand and interpret IFRS better! If there isn’t a specific standard for a transaction, accountants have to use their judgment. But their judgment isn’t random! They should follow the definitions and rules laid out in the Framework for assets, liabilities, income, and expenses. However, the Framework isn’t a law or standard itself – so if the IASB makes a new rule that disagrees with the Framework, they just need to explain why they’ve done that. What Does the Framework Cover? The Framework talks about things like: - The goal of financial reporting, - What makes financial info...

  If you're a business owner or an investor in Nigeria, you’ve probably noticed that tax under the Finance Act 2019, is a whole lot easier—at least for companies and businesses! Let’s look at some changes in the Company Income Tax Act (CITA) 1990 occasioned by the Finance Act 2019 and how these affect businesses, investors, and even the economy. I.                     The Old Rules: Section 43 of CITA 1990 – A Throwback Remember the days when tax rules were all about certificates, computations, and endless paperwork? Well, that was the crux of Section 43 of the CITA 1990. Here’s what it used to look like: 1. Dividend Certificates    Back then, companies had to hand out certificates to every shareholder, detailing the dividend amount and the profits it was paid from. Think of it like a receipt, but one you probably never asked for! 2. Complex Tax Calculations Ever tri...

  Introduction:   Let’s digress a bit to talk about the one thing that has everyone sweating right now—fuel price! If you haven’t heard, the price of petrol (PMS) has just been increased by the Nigerian National Petroleum Corporation (NNPC) to ₦ 1,030 per litre. That’s the latest news in the midst of the troubles that an average Nigerian has to contend with lately. So, the big question on everyone ’ s mind is: What does this mean for you, your wallet, and how you survive the rest of 2024? In this article, we’re going to break it down. How will this price hike affect your daily expenses, transportation costs, food prices, and basically the cost of everything? And most importantly, what can you do to survive this fuel wahala?   1. Transport Costs Let’s start with the one area where the hit will be most obvious—transportation. There’re already public transport hikes: Buses, keke (tricycles), okada (motorcycles), taxis, Bolt, Uber—name it, everyone is jacking up their...

  Alright, let’s talk taxes! We’re examining the world of minimum tax in Nigeria for companies—the law that ensures businesses still contribute their fair share even if they make a loss or don’t have much profit to show. Check out the amazing cloud hosting services offered by Truehost  here ! The Old Minimum Tax: Section 33 of the CITA Before the Finance Act 2019 came, businesses in Nigeria followed the Company Income Tax Act (CITA) when it came to paying taxes—even if they were not making any profits. The idea was simple: Even if your business isn't exactly ‘buoyant’, you should still pay something in taxes, right? Here’s the recap of what the old law (Section 33 of CITA) had to say: 1.        When Does Minimum Tax Apply? Minimum tax comes into play when: a.       A company makes a loss in a given year (so no taxable profits). b.       A company’s tax liability is less than the minim...

  Taxes play a significant role in shaping the economic environment of any nation. In Nigeria, the Company Income Tax Act (CITA) is a critical piece of legislation that governs how businesses pay their taxes. However, not all profits or incomes are subject to tax under this law. Certain profits and incomes are explicitly exempted, offering relief to specific sectors or activities deemed essential for economic growth. In this article, we’ll explore the types of profits and incomes that are exempted from tax under CITA, breaking them down in a clear and straightforward way.   Profits of Friendly and Co-operative Societies Under CITA, the profits of any statutory or registered friendly society are exempt from tax as long as these profits are not derived from any trade or business carried on by the society. Similarly, co-operative societies registered under laws relating to co-operative societies enjoy tax exemptions, provided their profits come strictly from co-operative ac...

  In Nigeria, taxation laws are crucial for businesses to understand and comply with. One of the key laws governing company income tax is the Company Income Tax Act (CITA) 1990. However, like any legal framework, CITA has undergone amendments to address changing economic realities and improve clarity. A significant update came with the Finance Act 2019, particularly in Section 12, which amends Section 29 of the CITA. Check out the amazing cloud hosting services offered by Truehost  here ! In this article, let’s highlight the subtle modifications section 12 of the Finance Act 2019 make in the CITA 1990, focusing on the computation of assessable profits for a company just commencing business or trade—commencement rules—in Nigeria. Assessable Profit of Companies Commencing Business: The Old Rules Originally, under the old rules, Section 29 of the CITA 1990 detailed how the profits for the first three years of a new trade or business in Nigeria should be assessed. The rules ...

The examination timetable of the November diet of the Institute of Chartered Accountants of Nigeria (ICAN) is currently out. The examinations are scheduled to commence in this month of November. The question I was frequently asked by students is: How do I pass the larger-than-life examinations of the Institute of Chartered Accountants of Nigeria (ICAN) without hassle? And borrowed from this is the question of how to tackle ICAN’s examination questions?   Without much ado, let me begin by dispelling as untrue the saying gaining currency among student members of the Institute that you cannot pass its examinations at one sitting. You can pass your ICAN examinations at one sitting, and you will; just simply follow these principles that worked for me and which I have told some of my students to follow through on: Prepare ‘professionally’ To begin with, to even muster the thought of passing any examination at all you need to be prepared. Now, professional examinations like tho...