PROJECT TOPIC- IMPACT OF PROFESSIONAL BODIES ON THE DEVELOPMENT OF ACCOUNTANCY PROFESSION IN NIGERIA
In Nigeria there are three well recognized Accountancy professional bodies that see to the overall affairs of Accountancy profession. These professional bodied are; Institute of Chartered Accountants of Nigeria (ICAN). Association of National Accountants of Nigeria (ANAN), Institute of Cost and Management Accountants (ICMA). This work analysis the impact of professional bodies on the development of Accountancy profession in Nigeria.
In order to find out the impact of these professional bodies on the development of accountancy in Nigeria, the activities of these professional bodies were examined. The mutual relationship among these professional bodies was studies and various impacts created by some organs of professional bodies such as society of Woman Accountants of Nigeria, Chartered Accountants in Business etc, were also examined.
Secondary data were the main source of data used for the analysis. Analysis made disclose that professional accounting bodies have made a great impact in the development of Accountancy profession in Nigeria. The problems and prospects of accountancy professional bodies were examined and recommendation made for further development of accountancy profession in Nigeria.
1.1 BACKGROUND OF THE STUDY
Accountancy as a profession has undergone various stages in its development. Various accounting bodies of the world have contributed in the development of the profession in their various countries and beyond. In order to lay more emphasis on the impacts of the professional bodies mostly as it concerns Nigeria let’s look at three major professional accountancy bodies in Nigeria; the Institute of Chartered Accountancy of Nigeria (ICAN), the Association of National Accountants of Nigeria (ANAA) and the Chartered Institute of Cost and Management Accountants (CIMA).
ICAN as the first and foremost professional accountancy body in Nigeria was seen to have contributed greatly to the development of the accountancy profession in Nigeria. It was discovered that ICAN has made contribution for the development of the profession in the following ways;
- Formation of Nigeria Accounting Standard Board (NASB) in 1982. This is responsible for the issuance of accounting standard (SAS) in Nigeria.
- Training of professional accountants through professional examination which takes various stages.
- Establishment of Accounting Technician Scheme (ATS) in 1989 to train middle level accountants.
- Partaking in the drafting of companies and allied matters, 1990.
- Establishment of Society of Women Accountants (SWAN) in 1978 to consolidate the impact of women in the development of the profession.
- ICAN prepares the standards and guidelines for auditing in Nigeria through Auditing Standard Committee (ASC).
ICAN also organizes seminars, mandatory continuing professional education programme etc. ICAN works with and represents Nigeria in other international accounting bodies in the world such as IFAC. All these have helped greatly in the development of the profession in Nigeria. It was also discovered that ANAN is making a good impact in the development of the accountancy profession in Nigeria, especially the establishment of Nigeria College of Accountancy (NCA) in Jos which is a breeding grounds for professional accountants. ANAN also organizes professional examination, continuing professional education, seminars etc.
The chartered institute of cost and management accountants is a new body, but was discovered to be making a good impact in the development of the profession. For the maintenance of the standards of the professional accountant, it was found out that the professional accountancy bodies have severe punishment for their erring members and students. Students can be banned from taking the institutes examination or suspended for some years if caught in examination misconduct or suspended for some years.
Many professional accountancy bodies have been formed in various countries. Some of these bodies include the Institute of Chartered accountants in England and Wales, the American Institute of Certified Public Accountants, the Institute of Chartered Accountants of Scotland etc. apart from these bodies which are country based, there are other professional accountancy which cut-across various countries. These bodies include, International Federation of Accountants (IFAC), Accountancy Bodies of West Africa (ABWA), and Africa Accounting Organization (AAO) etc. these bodies have strongly contributed to the development of accountancy in their various countries and in the whole world in general.
In this research work, each of these bodies will be examined, their establishment, activities and most importantly their impact on the development of accounting profession in Nigeria.
PROJECT TOPIC- IMPACT OF PROFESSIONAL BODIES ON THE DEVELOPMENT OF ACCOUNTANCY PROFESSION IN NIGERIA
1.2 STATEMENT OF PROBLEM
The institutes of accountants and their members have been subjected to increasing public scrutiny following protracted criticism in many jurisdictions over a substantial period (Lovell 1995 p.60). The failure of accounting documents to reveal a more accurate reflection of the financial well being or ill health of organization and the collusion of accountants in the preparation and validation of those documents, to the failure of the accountancy profession satisfactorily to take account of the public interest in the determination of the future of accounting and auditing practice.
High profile corporate collapses and fraud with which accountants have been associated to auditors, executives and directors have prompted searching question to be asked as to the integrity of the professional accountants’ involved (Clark et el, 2003). These collapses or systemic failure, as the broad range of financial scandals exposed in the early years of the 21st century have been labeled, have brought into sharp focus and over a more concentrated time scale, issues of long-standing debate include; audit and accounting regulation, auditor and independence earnings management, audit and audit firm quality controls (Browns 2005, Young 2005, Reinstein and Mcmillian 2004).
Briloff (1986) alerted over the years that the credibility of accountancy profession is threatened when the idea of integrity, independence, public service and ethical standards came under suspicion. The core issue in the context of the accountancy profession is the statutory audit monopoly privilege enjoyed by public accounting practitioners and the accountability that is demanded by that privilege. These and other problems affect the development of accountancy profession especially in Nigeria and they need to be addressed.
1.3 PURPOSE OF THE STUDY
The purpose of this study includes;
- To examine the activities of the professional accountancy bodies towards the development of accountancy in Nigeria.
- To examine the role of professional bodies in promoting the prospect of accounting profession.
- To examine the extent the professional bodies have promoted the highest standard of competence, practice and conduct among members.
- To examine the standard required of a professional accountant in enhancing the development of accounting profession.
1.4 RESEARCH QUESTIONS
- Have ICAN and other professional bodies contributed to the growth and prospect of accounting profession in Nigeria?
- To what extent have the professional bodies promote the highest standard of competence, practice and conduct among the members of the profession?
- Have the professional ethical conduct specified the required standard expected of a professional accountant towards the development of accountancy profession?
- Have the activities of the professional bodies depict that there are significant input towards sustaining the prospect of accountancy profession in Nigeria.
1.5 SIGNIFICANCE OF THE STUDY
This research work is of interest important to people who want to know about the professional accountancy bodies in Nigeria and what they do for the development of accountancy in Nigeria. For undergraduates and graduates and many others who will wish to become a professional accountant, this work is of good help to them.
This work will also make the public and the private sector to appreciate the role of professional accountants in the economy. By this accountants should be unreserved, given the accounting positions in the economy for the development of the economy and accountancy profession. Moreover, other researchers who want to know about the professional accountancy bodies will need this work as a guide and reference material. This work is for accountants, intending accountants and all other people who are interested in accounting information and profession.
1.6 SCOPE OF THE STUDY
A lot of professional accountancy bodies exist all over the world. Some are international bodies while some are country based. These international bodies have impact in the development of accounting of accountancy in various countries of the world including Nigeria. In this work, the impact of these international professional bodies was not studied. This work concentrates only on the professional accountancy bodies in Nigeria and their impact on the development of accountancy in Nigeria.
There are other professional bodies that have relationship with accountancy profession and contribute to its development. Some of these include Chartered Institute of Taxation of Nigeria (CITN), Chartered Institute of Stockbrokers of Nigeria (CISN) etc. The impact of these bodies in the development of accountancy in Nigeria was not studied. Once more, there are accountants who are not professionally qualified and who do not belong to professional accountancy body in Nigeria. These categories of accountants may have made an impact on the development of accountancy in Nigeria. In this work, the impact of these classes of accountants was not studied.
Notwithstanding the high degree of research done in this work, it cannot claim to be devoid of limitations. During the course of this work, the researcher could not get detailed information about the professional accountancy bodies and what they have done for the development of accountancy in Nigeria. The researcher notwithstanding the limitations tried to study closely these professional bodies and their impact in the development of accountancy in Nigeria with the available information.
1.7 DEFINITION OF TERMS
- Accountancy: This is a process of gathering, classifying, analyzing, interpretation and communication of financial information.
- An Accountant: This is a person trained to carryout accountancy functions. Accountancy is the profession of an accountant.
- Professional Accountant: This is a person who sis ratified by the professional accountancy body after passing the stages of examination for getting the certification.
Development: This refers to gradual growth of something until it becomes advanced. It is the act of making a thing improved and advanced.