CONTENTS
Vision Statement To be a leading global professional body. Mission Statement To produce world-class chartered accountants, regulate and continually enhance their ethical standards and technical competence in the public interest.
« ASSOCIATION OF ACCOUNTING 3 TECHNICIANS WEST AFRICA Notice of Meeting « ANNUAL ACCOUNTANTS’ CONFERENCE « INFORMATION TECHNOLOGY 4 « MEMBERS’ EDUCATION AND Officers and Council TRAINING « ICAN MEMBERS’ BENEVOLENT & EDUCATIONAL TRUST FUND 5 « RESEARCH, TECHNICAL AND Past Presidents PUBLIC POLICY « FACULTIES « STUDENTS’ SPECIAL PROJECT « STUDENTS’ AFFAIRS
6 « PROFESSIONAL EXAMINATIONS President’s Statement « LEGAL SERVICES « FINANCE & GENERAL PURPOSES « PUBLICATIONS AND IMAGE 19 Reports of Committees of Council « MEMBERSHIP AFFAIRS « ACCOUNTING TECHNICIANS 46 SCHEME WEST AFRICA Financial Statements
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 2 2018 Annual Report & Financial Statements ► NOTICE of Meeting
54TH ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the 54th Annual General Meeting of The Institute of Chartered Accountants of Nigeria (ICAN) will hold at ICAN Centre, Plot 12, Kofo Kasumu Street, Lakeview Estate, Phase 1, Amuwo Odofin, Lagos on Friday, May 31, 2019 at 11.00 a.m. to transact the following business:-
AGENDA
(a) ORDINARY BUSINESS
1. To adopt the minutes of the Annual General Meeting held on June 14, 2018.
2. To receive the Annual Report of Council, Financial Statements for the Year ended December 31, 2018 and the Auditor’s Report thereon.
3. To elect members of Council.
4. To appoint the Auditors and authorise Council to fix their remuneration.
(b) SPECIAL RESOLUTION
To ratify Council decision on Annual Subscriptions payable by members.
By order of the Council.
Dated this 10th Day of May, 2019.
John I. Evbodaghe, MBA, FCA Registrar/Chief Executive
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 3 2018 Annual Report & Financial Statements ► OFFICERS and Council
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA (Established by Act of Parliament No.15 of 1965) OFFICERS & COUNCIL 2018–2019
President Razak JAIYEOLA (Alhaji), BSc, ACFE, CRISC, FCA (2005) Vice President Nnamdi Anthony OKWUADIGBO (Mazi), BSc, FCA (2007)
1st Deputy Vice President Onome Joy ADEWUYI, BSc, MSc, FCIB, FCA (2007)
2nd Deputy Vice President Comfort Olujumoke EYITAYO, mni, CFA, FCA (2007)
Immediate Past President Isma’ila Muhammadu ZAKARI (Mallam), mni, BSc, FBR, FCA (2004)
Honorary Treasurer Oyemolu Olugbenga AKINSULIRE (Chief), MSc, MBA, FNIM, FCA (2013)
Members Oluwatobi Ayodele ABIOLA, HND, BSc, FCA (2017) Solomon Oluwole ADELEKE (Deacon), FCA (2008, 2016) Titilola Ariyike Nurat AKIBAYO (Alhaja), MBA, FCIT, FCA (2016) Davidson Chizuoke Stephen ALARIBE (Chief), MA, CFA, MNIM, FCA (2012) Chibuzor Noel ANYANECHI, BSc, MBA, FCA (2016) Deji AWOBOTU (Dr.), M.IoD, FCA (2015) Felicia Aina BAMGBOSE, FCA (2017) Adaku Chilaka CHIDUME-OKORO (HRM), BSc, MSc, FCA (2009) Samson Adewale DISU (Rev.), MSc, FCA (2017) Jude Sunday EGBO, HND, MBA, FCA (2017) Omehe Gaddafi Peter EHKORAGBON, HND, FCA (2017) Tijjani Musa ISA (Mallam), BSc, M.IoD, FCA (2009) Ahmed Modu KUMSHE, PhD, FCA (2017) Nasiru MUHAMMADU, BSc, MSc, FCIT, FCA (2014) Godwin OBAJE (Navy Capt.), FCA (2017) Olutola OGUNDIPE, B.Eng, FCA (2017) Monica Ngozi OKONKWO, MSc, ACIB, FCA (2011) Innocent OKWUOSA, MSc, ACIB, FCA (2011) Jamiu OLAKISAN, HND, BSc, ACS, FCA (2018) Tajudeen Adewale OLAYINKA, BSc, MBF, FCA (2014) Etofolam Felix OSUJI (Dr.), mni, MSc, FCTI, FCA (2014) Hilda Ofure OZOH, MBA, FCA (2014) Queensley Sofuratu SEGHOSIME, mni, MBA, FCA (2014) Haruna Nma YAHAYA (Alhaji), BSc, MBA, ANIM, FCA (2011, 2014)
Registrar/Chief Executive John Irabor EVBODAGHE, MBA, FCA
Joint Auditors PriceWaterhouseCoopers (Chartered Accountants) UHY Maaji & Co. (Chartered Accountants)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 4 2018 Annual Report & Financial Statements ► Past PRESIDENTS
THE ASSOCIATION OF ACCOUNTANTS IN NIGERIA (The Forerunner of the Institute) 1960 – 1961 Akintola WILLIAMS, CBE, CFR, B.Com., FCA 1961 – 1962 Akintola WILLIAMS, CBE, CFR, B.Com., FCA 1962 – 1963 Frank Cuthbert Oladipo COKER, CFR, B.Com., FCA (Deceased) 1963 – 1964 Frank Cuthbert Oladipo COKER, CFR, B.Com., FCA (Deceased) 1964 – 1965 Frank Cuthbert Oladipo COKER, CFR, B.Com., FCA (Deceased) THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 1965 – 1966 Frank Cuthbert Oladipo COKER, CFR, B.Com., FCA (Deceased) 1966 – 1967 Ephraim Adekunle OSINDERO (Otunba), MON, FCA (Deceased) 1967 – 1968 Herbert William BOND, FCA (Deceased) 1968 – 1969 Zacchaeus Oludayo OSOSANYA, FCA (Deceased) 1969 – 1970 Alfred EHREN, FCA 1970 – 1971 Felix Bankole CARDOSO, FCA (Deceased) 1971 – 1972 Emmanuel Ayodele ODUKOYA (Archdeacon), FCA (Deceased) 1972 – 1973 Musliu Olaiya ANIBABA (Chief), FCA 1973 – 1974 Vincent Obajimi Adebisi OGUNBA, FCA (Deceased) 1974 – 1975 Julius Akinyokun OWOSENI (Chief), FCA (Deceased) 1975 – 1976 Michael Adepoju ADEYEMO (Prof.), MSc (Econs.), FCA (Deceased) 1976 – 1977 Cecil Oyeniyi Olurotimi OYEDIRAN, BSc (Econs.), MFR, FCA 1977 – 1978 Anthony Asuquo ANI (Chief), MON, FCA 1978 – 1979 Arthur Christopher Izuegbunam MBANEFO (Chief, Amb.), (Odu III), MFR, CON, FCA 1979 – 1980 Joseph Akintunde Alaba ADEBAYO (Prince), FCA 1980 – 1981 John Adepoju BALOGUN (Sir), FCA (Deceased) 1981 – 1982 Idris Onaolapo SULAIMON (Alhaji), FCA (Deceased) 1982 – 1983 Olusola FALEYE (Chief), FCA (Deceased) 1983 – 1984 Dolanimi Babafemi Olabamidele OGUTUGA, FCA 1984 – 1985 Johnson Kayode Osiyemi OSINAIKE, FCA (Deceased) 1985 – 1986 Adedoyin Olayide OGUNDE (Otunba), FCA (Deceased) 1986 – 1987 Samie Aremu WILLIAMS, FCA (Deceased) 1987 – 1988 Johnson Olaobaju Olabisi OMIDIORA (Balogun), BSc, OON, FCA (Deceased) 1988 – 1989 Ebenezer Folorunsho OKE (Chief), BSc, FCA (Deceased) 1989 – 1990 Bola KUFORIJI-OLUBI (HH, Otunba Ayora, Dr.) BSc, OON, FCA (Deceased) 1990 – 1991 Michael Ayodeji ONI, BSc, FCA 1991 – 1992 Cornelius Oladipupo Sunday OSENI, BSc, FCA (Deceased) 1992 – 1993 Oluwole Alani ADEOSUN (Chief), BSc, OON, FCA (Deceased) 1993 – 1994 Ismaila USMAN (Mallam), FCA 1994 – 1995 Olutoyin Olusola OLAKUNRI (Chief, Mrs.), OFR, FCA (Deceased) 1995 – 1996 Simeon Olusola OGUNTIMEHIN (High Chief, Sir), OON, FCA 1996 – 1997 Emmanuel Itoya IJEWERE, FCA 1997 – 1998 Agnes Adenike ADENIRAN (Princess), FCA 1998 – 1999 Ike NWOKOLO (Dr., Sir, Chief), OFR, KSC, ATII, FCIT, FIMC, CMC, FBR, FCA (ICAEW), FCA 1999 – 2000 Adeboye Olugboyega BADEJO (Chief), FCA 2000 – 2001 Herbert Adewole AGBEBIYI, KJW, FCA 2001 – 2002 Ugochukwu Stephen NWANKWO (Chief), MON, FCA (Deceased) 2002 – 2003 Felix Kolawole BAJOMO (Senator, Chief), mni, FCA 2003 – 2004 Jaiye Kofolaran RANDLE (Bashorun), CFR, FCA 2004 – 2005 Ibironke Mojisola OSIYEMI (Mrs.), FCA 2005 – 2006 Abdul Lateef Adebayo OWOYEMI (Alhaji, Otunba), FCA 2006 – 2007 Catherine Ginikanwa OKPAREKE (Chief, Dr., Mrs.), mni, B.A, MBA, D(Lit.), MNIM, FCA 2007 – 2008 Adebajo Abiodun BABINGTON-ASHAYE (Prince), FCA (Deceased) 2008 – 2009 Richard Uchechukwu UCHE (Chief), PhD, FCA 2009 – 2010 Elizabeth Omeresan ADEGITE (Chief, Mrs.), BSc, MBA, FCA 2010 – 2011 Sebastian Achulike OWUAMA (Major-General retd.), BSc, FCA 2011 – 2012 Francis OJAIDE (Professor), MSc, PhD, OON, FCA 2012 – 2013 Adedoyin Idowu OWOLABI, BSc, MILR, FNIM, FCA 2013 – 2014 Kabir Alkali MOHAMMED (Alhaji), mni, FCIS, CGMA, MFR, FCA 2014 – 2015 Chidi Onyeukwu AJAEGBU, FCS, MBF, FCA 2015 – 2016 Samuel Olufemi DERU (Otunba), FNIM, JP, FCA 2016 – 2017 Titus Alao SOETAN (Deacon), FCA 2017 – 2018 Isma’ila Muhammadu ZAKARI (Mallam), mni, BSc, FBR, FCA (IPP)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 5 2018 Annual Report & Financial Statements ► Razak JAIYEOLA (Alhaji), BSc, ACFE, CRISC, FCA 54th President
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 6 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
am delighted to welcome you all to the 54th Annual In Nigeria, the pre-election activities pervaded the whole General Meeting (AGM) of our great Institute. On behalf economy and had material impact on economic, social and of the Governing Council, I wish to express our gratitude political governance. Apprehensions on the outcome of the to the over 48,000 members of ICAN for the confidence 2019 General Elections led to some economic imbalances. For reposed in us to serve the premier Professional instance, according to Proshare, capital outflow in the months IAccountancy Institute in Africa. It has been an eventful twelve preceding the elections was significant with an estimated US$9 (12) months and I have the honour to present the account of billion of local Treasury Bills held by foreign investors. This was our stewardship for 2018/2019 Presidential year. The audited due to uncertainty on the outcome of the elections. financial statements for the year ended December 31, 2018 During the period under review, the Central Bank of Nigeria would also be presented at this AGM. was able to sustain economic growth for five consecutive Expectedly, the Institute operated within the social, financial quarters making it possible for the nation to consolidate on its and economic dynamics that prevailed globally and in the exit from recession in 2017. Although the apex bank reported country for the year under reference. These undercurrents had that the pace of GDP growth slowed down in 2018, the country material impact on our activities and shaped most of the events ended the year with an average growth of about 1.9 percent. of the Presidential Year. It is therefore expedient for me to Also, inflation rate declined for eighteen consecutive months briefly provide information on some of the developments across and dropped to 11.1 percent in July 2018. The rate of inflation the world and the country as they affected the Accountancy however increased, albeit slightly, from September 2018 Profession and consequently the Institute. This would provide the basis to assess our humble and modest achievements in this Presidential Year.
AN OVERVIEW OF THE ECONOMY The year 2018 witnessed fundamental developments in the country and across the world. The performance of Nigeria’s budget, which formed the basis for most economic decisions, was estimated at about 75 percent. Considering its late passage, the 75 percent performance was fair as there was a delay in the pick- up of major economic activities. The Institute was not precluded from the vagaries of the economic impact of 2018 as its operations resulted in a deficit net income, the second of such in the last 15 years. Our financial position underlining this operational President Muhammadu Buhari welcoming ICAN President and his team to Aso Rock deficit will be explained by the Honourable Treasurer’s presentation and Council is addressing reaching 11.44 percent by December of last year. One of the this to stem future occurrences. reasons attributed for this was the rising food prices. We also have global developments impacting on the country’s The Federal Government continued to pursue the Economic economic performance as well as members’ lives. The global Recovery and Growth Plan (ERGP) during the period. One giant economic growth was around 3.1 per cent on the average in leap that was made was the improvement in the ease-of-doing- 2018. The growth rates varied from developed economies to business which saw the country moving up 24 points from its East and South Asia economies and the Americas. 169th position to 145th according to the World Bank 2018 ranking. The World Bank estimated growth in Sub-Saharan Africa This feat was achieved due to the various reforms championed to be about 2.3 percent for 2018, down from 2.5 percent in by the Presidential Enabling Business Environment Council 2017. As noted by the Bank, economic growth remained below (PEBEC) and the various Executive Orders aimed at improving population growth for the fourth consecutive year in the African business climate in the country. region implying a decline in the quantum of resources available Through the Anchor Borrower Programme (ABP), according to meet the needs of the new births and exacerbation of poverty. to the CBN, Nigeria emerged from being a net importer of rice Although, regional growth is expected to rebound to 2.8 percent to becoming a major producer of rice, supplying key markets in 2019, more needs to be done to positively impact the quality in neighbouring countries. It is estimated that Nigeria could hit of life of the citizenry and achieve reasonable milestones on the 16 million tons in 2023 if all the participating States under the Sustainable Development Goals. Central Bank of Nigeria (CBN) Anchor Borrowers Programme
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 7 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
convert their Pilot Programmes into massive production. In addition to preserving the country’s forex, increase in rice production would generate more job opportunities. In the same 2018, insecurity of lives and property became more pronounced. Indeed, incidences of banditry, kidnapping and armed robbery were pervasive thereby creating environments not conducive for investment activities. There were also agitations across regions of the country with different groups clamouring for either their fair share of the country’s resources or the need for a balance in the country’s political equation. The infrastructural deficit in the country widened and as at the end of 2018 it was estimated that the deficit would hit $878 billion by 2040. The above scenario point to the need for more aggressive and strategic efforts by the government to restructure the ratio of capital to recurrent expenditures in the annual budget, invest more in infrastructural facilities, leverage technology to secure lives and property, evolve innovative ICAN President, Alhaji Razak Jaiyeola visits World Bank in Abuja models to create jobs for the multitude of unemployed youths such that the economic growth of the nation Institute appreciates the National Assembly for disregarding would be people-focused, inclusive and sustainable. Since this unfounded calls and acting in the public interest and the a robust infrastructural base is a sine-qua-non and driver of promotion of professionalism in the country. economic growth and development, the security architecture of the nation, as part of the infrastructural base, must change to 1.2. FIRS Decision to Exclude ICAN Members from reassure citizens and enhance investors’ confidence. Acting as Tax Agents Members will recall that the Federal Inland Revenue Service 1.0 DEFENCE OF THE ICAN ACT (FIRS) took a decision last year to exclude ICAN members 1.1 Proliferation of Accountancy Bodies and other non members of the Chartered Institute of Taxation This Presidential year witnessed serious legislative activities of Nigeria (CITN) from engaging in tax practice in Nigeria with towards establishing new professional bodies which purport to effect from 2nd January, 2019. Their decision was premised on be specialists, one being the forensic and investigative audit and the letter written by CITN to this effect. other related subject matters. Indeed, the Senate of the Federal The Council of your great Institute was displeased with the Republic of Nigeria passed the Bill which sought to establish decision of FIRS and have taken far reaching steps to reverse The Chartered Institute of Forensic and Investigative it such that ICAN members will continue to practice as tax Auditors after consolidating three bills with similar names and consultants with the practicing license, seal and stamp of The object clauses. Institute of Chartered Accountants of Nigeria only. Pursuant to this, we reached out to stakeholders using various In furtherance to this, your Institute has instituted a legal channels to support the Institute in discouraging the passage of action at the Federal High Court while still deploying other the Forensic Auditors’ Bill by the House of Representatives. On measures to resolve the issue in favour of our members. April 16, 2019, the House of Representatives overwhelmingly We are also not unaware of proactive actions being made by rejected the Bill seeking for the establishment of the Chartered some very distinguished members of the Institute to seek legal Institute of Forensic and Investigative Auditors of Nigeria. We interpretation of the decision of FIRS based on existing and salute the courage of the House of Representatives for taking available documents in public space. This action has stalled the this bold step at safeguarding professionalism in the country. implementation of the decision of FIRS until final determination This was not just a victory for ICAN and professionalism but of the pending cases. for the country at large. We appreciate all our members who As a Council, we will continue to strive to protect the rights stood by the Institute in the course of defending our Act and and privileges of ICAN members both in practice and industry. we should not relent in our efforts to guard against any form of balkanization of our noble profession. However, there is need 1.3 Public Hearings and Memoranda to National for caution and continued vigilance as the promoters of these Assembly Bills are not done with their mischief and can resurface in some As part of its contributions to the legislative process, The other forms. Institute responded to four (4) public hearing requests by The Presidential Year also witnessed calls from some submitting memoranda as well as physically attending some detractors of the Institute instigating the National Assembly to hearings held by the National Assembly. The memoranda are: investigate the Institute as well as one to repeal our Act. The Position on the Recovery of Public Property (Special
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 8 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
Provisions) Act. management in the Institute has been developed and awaiting Public Hearing and Memoranda on the Legality of the Council approval. When implemented, it will ensure a result- Operations of the Special Presidential Investigation oriented framework for coherent and consistent strategic Panel for the Recovery of Public Property. planning and performance management. It will provide for a A Bill for an Act to Establish Fiscal Framework that planning calendar, involvement of key staff and stakeholders, encourages further investment in the Petroleum Industry organisation of strategic management activities, a planning whilst increasing Accruable Revenues to the Federal process as well as performance management system covering Government of Nigeria. activities at corporate, department and key employee levels. Public Hearing to investigate the state of the nation's four The policy will bring strategic planning practice in the Institute refineries, their Turn Around Maintenance (TAM) to date within the template recommended by PAFA and lead to a system and Regular/Modular Licenced Refineries. that can be favourably compared with good practice in bench- marked Professional Accountancy Organisations. 1.4 Disciplinary Tribunal, Investigating Panel and Students’ Investigating Committee 2.2 ICAN Tax Strategy ICAN frowns at any form of professional misdemeanour During the Presidential Year, the Council approved the among its members. In line with its enabling Act, the Institute Implementation of Tax Strategy by the Taxation Faculty Board set up various mechanisms to discourage its members from of the Institute. This is to ensure that members of the Institute engaging in actions that can bring the name of the Institute into continue to contribute significantly to tax administration in the disrepute. During the Presidential Year, the Disciplinary Tribunal, country. The thrusts of the ICAN Tax Strategy are to: Investigating Panel and Students’ Investigating Committee Influence the tax system positively in all key areas of tax achieved the following: policy, legislation, administration and adjudication. a. The Accountants’ Disciplinary Tribunal Make ICAN a reference point and a voice for tax and In this Presidential year, the Tribunal had four (4) sittings, fiscal policy matters in Nigeria and internally. considered a total of twelve (12) cases and one (1) application Set standards and guidelines for tax practice in for reinstatement. The Tribunal concluded two (2) cases and re- collaboration with other relevant bodies. admitted a member who was suspended for three (3) years in Enhance members’ value proposition through quality 2015, having duly served the suspension period. The Tribunal is training, skills development programmes, recognition currently handling a total of ten (10) cases which are at various and practice protection. stages of completion. Promote transparency and accountability in the tax b. The Accountants’ Investigating Panel system for the overall good of society. The six (6) arms of the Investigating Panel all met at various times and dealt expeditiously with outstanding cases and new 3.0 PUBLIC INTEREST MANDATE ones. 3.1 Inaugural Report on ICAN Accountability c. The Students’ Investigating Committee (SIC) Index (ICAN AI) The Committee considered a total of twenty-seven (27) In continuation of the initiative from the last Presidential Year cases out of which seventeen (17) were concluded while ten to make the public sector more accountable, I am delighted to (10) are pending. note that the inaugural report of ICAN AI showing all the States and Federal Government was presented at the 48th Annual 2.0 STRATEGIC PLANNING Accountants’ Conference and the initiative was well-received 2.1 Strategy Policy by participants. Let me also add that IFAC congratulated the A policy to institutionalise and embed best practice strategic Institute for the great milestone at our meeting with the global body in Sydney, Australia. Without doubt, the ICAN-AI has considerably enhanced the Institute’s goodwill and further placed it in a respected position as a major driver in the task of enthroning accountability and good governance in the country. It is noteworthy that Zimbabwe, under the auspices of IFAC, invited ICAN to the country on April 2, 2019 to share our experiences in order for Zimbabwe to leverage those experiences in the development of a similar index for the country.
3.2 Stakeholders’ Fora and Economic Discourse In the course of the Presidential Year, we had two Stakeholders’ Fora. The fora reviewed the Exposure Draft of the 2018 Nigerian Code of Corporate Governance and the Institute’s position was communicated to the Financial ICAN President, Alhaji Razak Jaiyeola visits the Speaker, House of Representatives, Reporting Council of Nigeria (FRC). During the Rt. Honourable Yakubu Dogara year, the Institute had a representative on the
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 9 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
Audit Regulation Working Group of the FRC. This was one of President challenged the Institute to assist the nation to our strategic steps at contributing to the promotion of good promote sustainability practices in public governance, business Corporate Governance and the standardisation of audit practice management and corporate reporting. in the country. The role of ICAN in repositioning the country’s tax system was also extensively discussed at one of the fora. 4.2 Visits to other Key Functionaries of Government In February 2019, we held Economic Discourse where and Traditional Rulers the country’s economy was x-rayed and recommendations During the period under review and as part of our strategies proffered to various stakeholders in the country. The Discourse to reinvigorate the advocacy agenda of the Institute, we paid was resourced with eminent and versed professionals and the courtesy visits to several government functionaries and Institute benefitted from their respective wealth of experience. traditional rulers. During these visits, we raised issues pertinent to the accounting profession, the economy and the readiness of 3.3 Participation in the Activities of Nigerian the Institute to contribute to the growth and development of the Economic Summit Group (NESG) Nigerian economy. We attended the 24th NESG Summit with the theme “Poverty The views we canvassed in line with our public interest to Prosperity: Making Governance and Institutions mandate and our value propositions were well received and some Work. The Institute’s contributions at the Summit were duly understandings reached. The visits to government functionaries acknowledged. further deepened awareness on ICAN’s contributions and its members’ to public sector administration in the country. 3.4 Participation at the Quarterly Business Forum The Institute participated in all the Quarterly Business 4.3 Other Invitations Honoured Forum at the invitation of Prof. Yemi Osinbajo, GCON, the Vice We also honoured several invitations from various President. Our attendance at this Forum enabled the Institute organisations, institutions and individuals in the country covering to establish a good relationship with Vice President Osinbajo the Academia, Business Group bodies and ICAN recognised and the Economic Management Team. It also provided the Tuition houses. opportunity to network with other important stakeholders in the We used the platforms of these invitations to intimate the public country’s economic value chain. on the contributions of ICAN to the growth of various sectors in the economy. For instance, the goodwill messages delivered 4.0 PROMOTING THE ICAN BRAND at members’ Inaugural Lectures afforded us the opportunity to 4.1 Visit to President Muhammadu Buhari, GCFR project to the academic community ICAN’s support for cutting- On October 19, 2018, the Institute paid a visit to President edge research, particularly accounting-related research. We Muhammadu Buhari, GCFR, Commander-In-Chief of the Armed created awareness on the different means we are deploying to Forces at Aso Rock, Abuja. In my address, I strongly appealed achieve this support such as a token gesture of the sum of N1m to him not to sign any Bill that seeks to further fragment the (One million Naira) to support members’ inaugural professorial Accountancy Profession. Our appeal was widely publicised lectures; awards of grant to the tune of N500,000.00 to qualified in the print and electronic media. I seized the opportunity candidates undertaking doctoral degree programmes in to present a copy of the Communique of the 48th Annual accounting or related fields in recognised universities and; the Accountants’ Conference to him. Besides being delighted publication channels that our Journals afford academics and with the contributions of the Institute to national development others interested in research. as well as the recommendations of the Conference, the Our participation and presentation of papers at various tertiary institutions/tuition houses’ programmes were used to deepen the Catch-Them-Young programme of the Institute. The students were made to understand the prospects that lie ahead of them if they can take the bold step of becoming Chartered Accountants.
4.4 Collaborating with Other Professional Bodies The Institute participated fully in all the activities of the Association of Professional Bodies in Nigeria (APBN) and also honoured its financial obligations to the Association. During the period, we maintained our cordial relationships with sister professional bodies through participation in their different programmes and activities.
4.5 Regular Press Briefings to Reinforce ICAN’s Advocacy Role In order to reinforce ICAN’s advocacy role in the economy, we held several press conferences and President Muhammadu Buhari receiving a document from ICAN President, media interviews as well as issued press releases Razak Jaiyeola at Aso Rock, Abuja on topical issues covering Corporate Governance,
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 10 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
institute to set up its examination structure including the training of personnel to take on the various assignments. Other Professional Accounting Organisations (PAOs) which ICAN is mentoring include ONECCA Cameroon, ONECCA Niger and Liberian Institute of Certified Public Accountants.
4.9 Repackaging of The Nigerian Accountant The Editorial Board was reconstituted and mandated to review and reposition The Nigerian Accountant as well as the ICAN Students Journal with a view to making their contents more robust and inclusive. The publications now feature more local contents and top notch articles on various aspects of accounting and business in addition to its aesthetics.
4.10 Mr Akintola Williams’ 99th Birthday Anniversary (left) Otunba Subomi Balogun ; Chief Bode Emmanuel; ICAN President, Alhaji Razak Jaiyeola; On Thursday, August 9, 2018, the Doyen and Ogun State Governor, Senator Ibikunle Amosun (right) assisting Mr. Akintola Williams to his seat on his 99th birthday of our Profession Mr Akintola Williams, FCA celebrated his 99th Birthday, a rare Disruptive Technologies, Tax policy, Anti corruption crusade, and blessed age in this our time. The occasion was graced Forensic Accounting Bill, Increasing Debt Profile of the by myself, Council members and members of staff. Other nation and consequences thereon, Economic Diversification, important dignitaries at the event were Governors of Lagos and Increasing Growth in Population and Implications for the Ogun States Mr Akinwunmi Ambode, FCA and Senator Ibikunle Economy, Multiplicity of Forex Rates, Idle Assets Across the Amosun, FCA, CON, General Yakubu Gowon, GCFR, past Country, Unemployment of Youths, Professional Misconduct military Head of State, Mr. Ayo Oni, FCA a Past President and Across Various Professions, Africa Continental Free Trade Past Chairman, Body of Past Presidents of ICAN. Agreement and ECOWAS Trade Liberalisation Scheme. The press briefings were covered by both the print and 5.0 INTERNATIONAL ACTIVITIES broadcast media and thus ICAN voice reverberated throughout 5.1 2018 International Accountants’ Day this Presidential year on critical governance and economic The 2018 International Accountants’ Day was celebrated by issues. the Institute in grand style on November 10, 2018. We used the day to showcase members of the Institute who continue to play 4.6 Institute’s Website prominent roles in the growth and development of business and In order to improve the Institute’s communication with its economy. In rejoicing with the rest of accountants all over the numerous stakeholders via the internet, a new ICAN website world, we placed a centre-spread advert in The Punch & Daily was developed and launched. The new website is now more Trust newspapers. We also did a documentary that was aired on interactive and user friendly. TVC, AIT and NTA.
4.7 Awareness on the Non-Compliance with Laws 5.2 Visit by the Institute of Chartered Accountants and Regulations (NOCLAR) in England and Wales (ICAEW) The Council under my leadership continued the creation The Institute played host to the Institute of Chartered of awareness through stakeholders’ engagements, press Accountants in England and Wales (ICAEW) between April 24 conferences and media interviews on the need for members to – 26, 2019. The English Institute, led by its President, Mr Paul abide and live by the spirit of NOCLAR (i.e., the Non-Compliance Alpin, was in Nigeria to enhance the existing good relationships with Laws and Regulations) which the Institute keyed into in the and fruitful co-operation between the two Institutes and to last Presidential Year. accelerate the development of the accountancy profession. As part of the programmes of the visit, the two Institutes organised 4.8 Mentoring Programme a well-attended joint Economic Insight Event. I led the ICAEW The Institute is currently involved in the mentoring of The team to pay a courtesy visit to the Doyen of Accountancy Gambian Institute of Chartered Accountants (GICA). This is Profession, Mr Akintola Williams, FCA at his residence in Ikoyi, in line with the terms of the MoU signed between ICAN and Lagos on Friday, April 26, 2019. The Gambian Institute of Chartered Accountants (GICA) in May 2018. The implementation of the terms of the MoU commenced 5.3 Quality Comments on IFAC Exposure Drafts in September 2018. Accordingly, the Institute, through its During the 2018/2019 Presidential Year, the Institute consultant, Mr Toyin Adepate, FCA is helping The Gambian reviewed and commented on seven Exposure Drafts received
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 11 2018 Annual Report & Financial Statements ► PRESIDENT’s Statement
At the ICAN-USA District Conference & 10th Anniversary from IFAC’s standard setting bodies. The Drafts are: all the sessions of the Conference. During the Conference, a Proposed International Public Sector Accounting member was admitted into Membership, while 8 were elevated Standards: Improvements to IPSAS 2018. to the Fellowship Status. Proposed Strategy and Work Plan 2019 – 2023: Elevating We also used the opportunity of the Conference to visit the Ethics in a Dynamic and Uncertain World. World Bank headquarters at Washington where we met with Dr Proposed International Public Sector Accounting Ed Olowookere, FCA and his team to discuss possible funding Standard. supports by the Bank for the Institute’s activities. Professional Skepticism: Meeting Public Expectation. Tentative Agenda Decision – Borrowing Costs on Land 5.5 ICAN Canada & District Society 3rd International (IAS 23). Accountants’ Conference Tentative Agenda Decision – Determination of the The District Conference of this District was held in Winnipeg Exchange Rate when there is a Long-Term Lack of between July 18 and 22, 2018 with the theme “Accountancy: Exchangeability (IAS 21). A Profession in Transition”. During the Conference, two Tentative Agenda Decision – Expenditures on a Qualifying members were conferred with Fellowship Status. We also used Asset (IAS 23). the opportunity of the Conference to promote our reciprocity programme by visiting the Chartered Professional Accountants The Research and Technical Department and the Committee (CPA), Canada where we initiated discussion on signing a leveraged the knowledge of subject-matter experts to develop Reciprocity Agreement with the Canadian body. With reciprocity the Institute’s position on the Exposure Drafts which were duly arrangement in place, ICAN members would no longer have to acknowledged and appreciated by the standard setters. repeat all the examinations of those bodies before becoming
5.4 ICAN-USA District Conference and 10th Anniversary Celebration The historic event which took place in Washington DC between September 1 and 3, 2018 was attended by over 100 delegates and dignitaries which included the Nigerian Ambassador to USA; Chairman, FIRS, Mr. Tunde Fowler and Chief Albert Njoh Litumbe (93 years), one of the pioneer Partners of Akintola Williams Deloitte and Doyen of the Accountancy Profession in Cameroon. Past President C.O.O. Oyediran, BSc., FCA and his wife also attended Alhaji Razak Jaiyeola at the Canada Conference
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members. This would facilitate employment opportunities for our 5.9 Inaugural ECOWAS-ABWA Congress members abroad. In preparation for the Inaugural ECOWAS-ABWA Congress, the Institute spearheaded the formation of a Local Organising 5.6 1st ICAN Malaysia Zonal Accountants’ Committee (LOC). The LOC finalised the theme of the Conference Conference initially planned to hold between May 20 – 24, 2019. The Conference with the theme “Transition to the Fourth Towards the successful hosting of the Congress, ABWA secured Industrial Revolution: The Starting Blocks for Emerging the sum of US$50,000 sponsorship donation from ECOWAS. Economies” was held between February 18 and 20, 2019 This is in addition to another US$50,000 for the outstanding at Adya Hotel, Langkawi Island, Malaysia in collaboration grant to support the operations of ABWA. However, due to with Unversiti Utara Malaysia, Universiti Teknologi Mara and Accounting Research Institute (ARI). The Conference dealt with seven specialty tracks of education, labour, taxation, accounting and auditing profession, government, capital market and technology and business managers. The maiden edition of the Conference also achieved the following: The continuation of the process for signing a Memorandum of Understanding (MoU) with the Malaysian Institute of Accountants (MIA). The MOU would address collaboration with MIA on reciprocity arrangement, research and innovation and students’ examinations. Sponsorship opportunity of a package of RM50,000 to RM100,000 (N5,000,000 to N10,000,000) by Alhaji Razak Jaiyeola with participants at the ICAN-Malaysia Conference the Sarawak Government towards the 2020 edition of Malaysia & District Society of ICAN low registration of participants, the ABWA Council resolved to Conference. postpone the Congress to a later date. Deepening of the trust of Malaysians in Nigeria and Nigerians’ potentials. Also, the Embassy of Nigeria now 5.10 Participation in PAFA Activities consults with the Malaysia & District Society of ICAN on We attended PAFA Board and Committees meetings in issues relating to Nigerians in diaspora. Rwanda, Tunisia and South Africa. Through our participation, we have ensured that: 5.7 6th UK Zonal Annual Conference of ICAN Other sister professional bodies do not over influence We attended the 6th UK Zonal Annual Accountants’ decision making of the Body. Conference held at Crowne Plaza Western Gateway, Royal ABWA was not collapsed like the Regional Bodies in East Victoria Dock, London between March 14 – 17, 2019. The theme and Central Africa. of the Conference was Effective Institutions, Infrastructures ICAN is actively contributing to Africa Integrated and Technology: Pathways to Africa’s Future. A member Reporting Committee (AIRC). was inducted as an Associate while seven (7) were conferred Due to the adverse effects of the depreciated Naira, we with the Fellowship status of the Institute at the Conference. renegotiated our subscription as the cost of maintaining membership dues on PAFA became burdensome on the 5.8 Restructuring of ABWA Institute. For quite some time, the Association of Accountancy Bodies ICAN is a major contributor to the success of the in West Africa (ABWA) which ICAN helped to establish in 1982 flagship African Congress of Accountants (ACOA) by has been inactive due to lack of resources caused, in the main, the continually maintaining the largest delegation to the by the non-payment of subscriptions by its member-bodies. congress. I wish to commend Mrs Margaret Unubun, FCA who steered Also, we are discussing with PAFA to ensure that the the ship of the Association in spite of the lean resources before administration of the Accounting Technician Scheme (ATS) is she retired in May, 2018. As part of the strategies to restructure retained in Nigeria and there are signs that PAFA would not and revamp the body, the Institute liaised with other ABWA object to this. We have also maintained the standard of ATSWA member-bodies to spearhead the recruitment of a new Executive examinations. Secretary. After a very rigorous interview session conducted in ICAG, Accra by ABWA Council, Mr Abel Aigbodion Asein, FCA, 5.11 Participation in IFAC Activities ICAN’s former Deputy Registrar, Technical Services became the We continued to play active role in all IFAC activities including new Executive Secretary. Mr Asein, FCA, resumed in October, the Board of the global body through our representative on the 2018 at its Abuja Office. Board, Past President General Sebastian A. Owuama (rtd).
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General Owuama currently sits on the Governance Sub Committee of IFAC where he contributes to the ongoing Corporate Governance and Code of Ethics for IFAC Staff and Member Bodies Volunteers serving on the IFAC Board and Committees which will soon be released. In addition, General Owuama is the African representative on the Presidential Advisory Committee on the ongoing dialogue with the Monitoring Group (MG) on the future of the Standards Setting Boards.The Vice President and I, also represented ICAN at the IFAC AGM held in Sydney Australia and took part in the selection of new PAOs’ admitted into IFAC membership.
5.12 IFAC World Congress, Sydney, Australia The premier international accounting Conference for global business and finance community tagged World Congress of Accountants (WCOA) with the theme “Global Challenges/Global Leaders” was held from November 5 – 8, 2018 in Sydney Australia. The Congress brought together thousands of Professional Accountants from across the globe with a view to making them imbibe good values in the areas of integrity; trust and honesty; embrace diversity and adopt new technology and innovation for better performance. The Institute was represented by a 477-strong delegation. Nigeria ICAN President, Alhaji Razak Jaiyeola welcoming Ambassador Ibrahim won the second largest delegation after Sydney the host Gambari (middle) to the conference while the Chairman of Conference country. A member, Mr Bucky Agarry, won a recognition award Committee, Deacon Solomon Adeleke watches with admiration as the Special Martial Art Champion. A total of 393 registered through ICAN while 84 members registered directly with the discussion of common challenges and sharing of solutions and; organisers. A total of 93 delegates were unable to attend due to increasing the brand of Chartered Accountants worldwide. visa challenges. The Nigerian Ambassador to Australia and New Zealand hosted Nigerian delegates alongside ANAN members 6.0 MEMBERS’ ACTIVITIES during the event. 6.1 The 48th Annual Accountants’ Conference The 48th Annual Accountants Conference was successfully 5.13 Meeting with World Bank held between October 1 and 5, 2018. The Conference was Further to the successful implementation of two previous declared open by President Muhammadu Buhari, GCFR, grants by the Institute, a team of ICAN officials led by my Commander-In-Chief of the Armed Forces of the Federal humble self met with the World Bank officials in Washington Republic of Nigeria who was ably represented by Senator DC, during the ICAN-USA District Udoma Udo Udoma, Honourable Minister Conference held in September 2018 of Budget. The theme of the Conference with a view to seeking more funding was, “Securing Our Shared Future: from the bank. This was followed A Collective Responsibility”. The by another meeting in Abuja on conference had a record attendance September 14, 2018. We thereafter of 4,745 delegates including resource made a presentation and submitted persons and delegates drawn from a proposal to the World Bank on 16 countries and five continents. The funding. There has been follow up international delegates were led by thereafter. IFAC President, Ms Rachel Grime. The Conference extensively discussed the 5.14 Chartered Accountants subject of sustainability and Information Worldwide Forum Technology as they relate to different I am delighted to report that sectors of the economy. the Institute was admitted into the The Conference set new records in Chartered Accountants Worldwide various areas such as number of delegates, Forum at a colourful ceremony held number of countries represented and in Singapore to underscore ICAN’s amount of donations/sponsorships. The increasing relevance in the global conference communique was despatched accountancy community. ICAN to critical stakeholders and published in officially joined the membership of The Nigerian Accountant. Chartered Accountants Worldwide on August 30, 2018. The main 6.2 Professional Induction objectives for joining the Forum Ceremonies include networking with Chartered Professional Inductions were held Accountants across the world; Alhaji Razak Jaiyeola at the WCOA in Australia between November 20 and 22, 2018
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and May 7 and 9, 2019. The events were colourful and well attended with a total of 1,760 admitted as Associates and 10 as Registered Accountants (RAs) in the November 2018 edition and 1,631 Associates and 6 RAs in the May 2019 edition.
6.3 17th Conferment of Fellowship Status Ceremony The 17th Conferment of Fellowship Status Ceremony was held on April 23, 2019. A total of 1305 members were conferred with the Fellowship status of the Institute. The Special Guest of Honour, Ambassador Tunji Olagunju, admonished them to deepen their ethical disposition in order to arrest the decline in professional integrity across disciplines and by so doing deepening the love to serve the people.
6.4 2019 Annual Dinner and Awards The 2019 Annual Dinner and Awards was held on April 13, 2019 at Eko Hotels and Suites. The following were the awardees: ICAN President, Alhaji Razak Jaiyeola visits Ooni of Ife, Oba Adeyeye Ogunwusi His Highness, Sarkin Kano, Mallam Muhammed Sanusi II, CON. for members who successfully passed the various specialist Alhaji Otunba Abdul Lateef Adebayo Owoyemi, FCA, certification examinations of the Faculties. Past President, ICAN. Dr. Awa Ibraheem, FCA. 6.6 Review of the Training Curricula of MCPE Deloitte & Touche. The annual tradition of reviewing and repackaging the KPMG Professional Services. Institute’s MCPE training programmes to align them with The Governing Council of the Institute also approved the members’ expectation and the demands of other stakeholders following distinguished personalities for awards but they were was sustained. The MCPE Curricula was reviewed in December unable to attend: 2018 for the 2019 training brochure. This is to sustain the Chief Dr. (Mrs.) Nike Akande CON, former Minister of relevance of ICAN’s training programmes in view of changing Industry. dynamics in the economy and business climate. Professor Ibrahim Gambari, CFR, former Ambassador to the United Nations. 6.7 1st Accounting Technology Summit Mr Uyi Akpata, FCA, Regional Senior Partner, (ACCOUNTEKS) PricewaterhouseCoopers (PwC), West Africa. The Consultancy and Information Technology Faculty organised the 1st Accounting Technology Summit 6.5 2019 Faculties Induction Ceremonies (ACCOUNTEKS) between April 29 and 30, 2019. The Summit The 2019 Joint Faculties Induction ceremonies were held had about 388 participants and enjoyed sponsorship from various organisations. It contributed huge surplus to the Institute’s treasury. The various organisations/institutions represented include the Central Bank of Nigeria, the Big 4, Small and Medium Practitioners (SMPs), Ministries, Departments and Agencies (MDAs), players in the FinTech and other technology space among others. As a result of the huge success of the Summit, we plan to hold a one-day follow up programme. This Summit is in line with current IFAC’s initiative to deploy different means for sensitising its Members on the disruptive effects and impact of technology such as Artificial Intelligence and Robotics on the future of the Accountancy Profession and attracting the younger generation to the profession.
6.8 2019 ACCOUNTEX SUMMIT, UK We participated at the 2019 Accountex Summit UK held in London in order to learn how to improve on the subsequent editions of the Accounting Technology Summit organised by the Institute. The UK Accountex ICAN President, Alhaji Razak Jaiyeola (middle) and other dignitaries at the Summit is an annual event powered by Diversified 1st Accounting Technology Summit Communications UK and brings together over 8,000
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6.10 13th Western Zonal Accountants’ Conference The 13th Western Zonal Accountants’ Conference was held between March 5 and 8, 2019 at the Musical Village, Ikorodu. The Conference had a record figure of about 818 delegates. As part of the pre-Conference activities, I paid courtesy visits to His Royal Majesty (Oba) Engr. Kabir Shotobi, FNSE, Ayangburen of Ikorodu Kingdom and His Royal Majesty, (Oba) Bakare Agoro, BSc., FCA, Ranodu of Imota, Lagos who graciously donated a parcel of land to ICAN Ikorodu & District Society for the purpose of building a Centre for Catch-Them-Young Programme of the Institute.
6.11 2nd Southern Zonal Accountants’ Conference The 2nd Southern Zonal Accountants’ Conference was held between April 8 and 11, 2019 at Orchid Hotel, DBS Road, Asaba. I used the opportunity of the Conference to pay a courtesy visit to the Governor of Delta State, Dr Ifeanyi Okowa who was represented ICAN President with the Oba of Lagos in his Palace by the Acting Governor of the State, Barrister Kingsley Otuaro. I also visited the Rector and Academic Staff of accountancy and finance professionals. It is a unique opportunity Delta State Polytechnic, Ogwuashi-Uku and the Provost of Delta to hear from industry leading speakers, discover 100’s of new State University, Asaba Campus. At both institutions of higher products and services and network with peers. learning, I addressed accounting students and informed them about the opportunities upon their qualification as Chartered 6.9 13th Eastern Zonal Accountants’ Conference Accountants. Members of the Presidency and some Council members to attend the 13th Eastern Zonal Accountants’ Conference held at 6.12 Visits to District Societies Nike Lake Resort, Enugu between July 30 and August 1, 2018. Investiture Ceremonies for Chairmen of District Societies, I delivered the keynote address at the Conference while the Presidential Visits to District Societies & Inauguration of District Deputy Governor of Enugu State, Mrs Cecilia Ezeilo, represented Society of ICAN and Chapter were carried out during the and delivered Governor Ifeanyi Ugwuanyi’s goodwill message Presidential year. The following District Societies were visited: and declared the Conference open. Other dignitaries present Abuja, Ado-Ekiti, Mowe, Ibadan, Ikeja, Offa, Alimosho, Lagos at the Conference were Past President Chidi Ajaegbu and Mr. Mainland, Lagos, Osun and also Ogun State Civil Service Frank Nweke II, former Minister of the Federal Republic of Chapter of ICAN. Nigeria and Chairman, the Cerebral Lemon Company. 6.13 Association of Accounting Technicians West Africa (AATWA) The 48th Induction Ceremony for new AAT members was held between July 10 and 11, 2018. A total of 515 members were inducted. The 49th Induction Ceremony took place between December 10 and 11, 2018 with a total of 668 members inducted. The Annual General Meeting (AGM) and Conference, which was the gathering of all members of the Association, took place on December 12, 2018 and a total of 1,158 members attended.
6.14 ICAN International Academic Conference on Accounting and Finance The 5th International Academic Conference on Accounting and Finance with the theme Contemporary Issues in Business, Accounting and FinTech was held successfully between April 15 and 17, 2019 at Kaduna State University. A total of 152 delegates attended the Conference.
7.0 STUDENTS’ EXAMINATION AND RELATED MATTERS 7.1 Mutual Cooperation Agreements (MCAs) with ICAN President, Alhaji Razak Jaiyeola courtesy visit to the Institutions and Monitoring Executive Governor of Lagos State, Akinwunmi Ambode During the period under review, I signed the Mutual
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Cooperation Agreements (MCAs) with six (6) institutions while eight (8) institutions were reviewed for compliance on the MCA agreement with the ICAN standards.
7.2 November 2018 Diet Professional Examinations The November 2018 and May 2019 diets of the Institute’s Professional Examinations took place at the approved centres across Nigeria, Beau in Cameroon and London, United Kingdom.
7.3 E-Marking (On-Screen Marking) The Institute is transiting to on-screen marking as an improvement and world class alignment being a solution to meeting the growing student population sitting for the Institute’s examination and the prompt release of results. Pursuant to this, the Council in October 2018 approved the full implementation of on-screen marking.
7.4 Meeting with Professional Examination Assessors In demonstration of this Presidential Year’s commitment to sustaining the integrity of the Institute’s examinations processes, I met with ICAN Assessors (Groups A, B and C) at various times at the Lagos Airport Hotel, Ikeja and conveyed ICAN President, Alhaji Razak Jaiyeola (right) presenting a souvenir to the support and appreciation of Council to members of the the CBN Governor, Mr. Godwin Emefiele “Examination Family”. The Assessors, in my engagements with them, highlighted germane issues that were imperative for the Institute to consider in order to ensure that the integrity of its examinations are not compromised. These issues are being looked at by the Institute.
7.5 New Examination Centres The Council at its meeting of January 15, 2019, considered and approved the creation of new Professional Examinations centres in Auchi, Edo State and Lafia, in Nasarawa State in our quest to bring examination centres closer to our students.
7.6 September 2018 and March 2019 ATSWA Examinations The September 2018 and March 2019 diets of ATSWA examinations were successfully conducted. During the Courtesy visit from Ecobank Executives Presidential Year, the Council approved four (4) new examination centres for ATSWA Examinations in the proposed ICAN Tuition centre in the area. Victoria Island, Malete (Kwara State), Ikeja and Oye-Ekiti as recommended by the ATSWA Committee. 8.0 THE INSTITUTE’S STAFF AND INFRASTRUCTURE 8.1 Meeting with Staff of the Secretariat 7.7 Catch-Them-Young Programme at Offa, Aware of the fact that members of staff are critical to achieving Kwara State the Agenda for the Presidential Year, I met with them on June We were at Offa to inaugurate the city’s edition of ICAN’s 11, 2018 shortly after my inauguration to interact and discuss “Catch Them Young” Programme. The programme was modalities for ensuring that their individual and collective successful with the Olofa of Offa and some of his chiefs in potentials are properly harnessed for the growth of the Institute. attendance at the ceremony. Over thirty-five secondary schools, In the course of the year some members of staff were within Offa, participated in the programme with about Nine promoted. We also ensured that a good number of the staff went Hundred (900) Students in attendance. During the visit, I met on either local or international trainings in order to hone their with over 14 members of the Institute in Offa and its environs on skills and competencies. Thirty five (35) members of staff were
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given different categories of Long- Service Awards and three (3) retired staff were celebrated at the 2019 Staff Long Service Award and Presentation held on May 6, 2019. Members of staff who were disengaged were appropriately remunerated to ensure a soft landing.
8.2 NAVISION AND CRM Systems Implementation Progress Report The importance of the recently installed Navision software to the Institute’s service delivery and market competitiveness made me to summon a meeting of all stakeholders in the NAV/CRM value chain on June 20, 2018. Representatives from all departments of the Institute were in attendance. Each department made a presentation on the challenges they faced in the full deployment of the Courtesy visit to the office of the Accountant General of the Federation, Alhaji Ahmed Idris software for efficient and effective performance of their respective job schedules. Solutions were CONCLUSION proffered for the challenges. I am glad to report to you that there Distinguished members, I conclude with this timeless Arabic has been a significant leap in the level of implementation of the proverb that “If you can’t reward, then you should thank”. It Navision software. is practically impossible for the Governing Council to reward our distinguished members and other stakeholders for the immense 8.3 Discontinuation of Hard Copies Dailies support we receive on a regular basis and most especially in I also requested that the purchase of hard copies of the the last one year. We, however, express once again our sincere national dailies for me should be discontinued. This was replaced gratitude. with subscription for online (soft) versions leading to reduction in In spite of the challenges we faced in the course of the year, cost. Over time, this initiative is expected to be adopted by the we were able to put the Institute more prominently on both entire Institute. local and international scenes. We pursued the interest of the over 48,000 members through various engagements in order 8.4 Introduction of Teleconferencing to ensure that our members operate in an enabling business In the Presidential Year, we introduced the use of environment. Our membership drive initiatives received a new Teleconferencing/e-meeting solution across the three office momentum in the year and the advocacy mandate of the Institute locations in Victoria Island, Ebute-Metta and Abuja. The facility was improved upon. We created awareness on the need for has provision for mobility and remote sign-on. It also makes Chartered Accountants to embrace emerging technologies that management of meetings flexible and cost efficient. are currently disrupting formally entrenched business models. No doubt, since June, 2018 when I was saddled with the CONDOLENCES AND TRIBUTES responsibility of leading one of the largest professional accounting In the course of the year, the cold hands of death snatched bodies in Africa, it has been a tasking but professionally some of our members and finest accountants in our country. rewarding experience. My wish is that ICAN would continue to We commiserate with the families, friends and professional play its leading role in building capacity of accountants in general colleagues of the departed and pray that their souls continue to and most importantly in the emerging disruptive technologies find eternal repose. such as Blackchain, Artificial Intelligence, Machine Learning, Specifically, I wish to mention the following: Robotics, Analytics and so on. As an Institute, we should Late Chief (Dr.) Mrs Olutoyin Olakunri, OFR, FCA (MB continue to protect the interests of all our members in both large No. 000142), Past President (1994 – 1995). and Small and Medium Practices firms. The Entrepreneurship Chief Olusola Faleye, OFR, FCA (MB000275), Past Programme of the Institute should be further deepened to serve President (1982 – 1983). as a platform for job creation for our unemployed members. His Excellency, Late Chief Ugochukwu Stephen As I conclude, the opportunity to serve our noble Institute Nwankwo, FCA, (MB No. 001210), Past President (2001 is a privilege I would cherish for a long time. I am therefore – 2002). renewing my commitment at promoting the ideals and protecting Alhaji Idris Onaolapo Sulaimon, FCA (MB No. 281), Past the interests of ICAN anywhere I find myself. President (1981 – 1982). Thank you and I wish ICAN more successful years ahead. Late Mrs Folake Onabolu, FCA (MB No. 2825), Chairperson, The Society of Women Accountants of Alhaji Razak A. Jaiyeola, BSc., ACFE, CRISC, FCA Nigeria (SWAN). 54th President
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MEMBERSHIP AFFAIRS ASSOCIATE MEMBERS OF THE INSTITUTE A total of 3,569 Inductees were admitted into membership of the Institute at the May and November 2018 Induction as against 2,499 Inductees admitted in 2017. The two ceremonies were held at the ICAN Centre, Amuwo-Odofin, Lagos. INDUCTION CEREMONIES During the Presidential year under review, one induction ceremony was held in November 2018 with a total of 1,760 new members admitted into the Associate membership of the Institute. A total of 10 members of IFAC recognised PAOs were also admitted as Registered Accountants. The total membership strength of ICAN President with Council Members the Institute as at December 31, 2018 was 46,864 made up of 46,828 Chartered Accountants and 36 The numbers in each class of membership were as follows: Registered Accountants. However, financial members (those up-to-date Category of Membership Fellows Associates Total with their membership dues) as at December 31, Members with 5,013 2,099 7,112 2018 was 19,153. Practicing Licence
MEMBERS’ RECORDS AND Members without 8,267 31,449 39,716 DOCUMENTATION ON Practicing Licence LICENCE/ATTACHMENT, TOTAL 13,280 33,548 46,828 CHANGE OF NAME, CHANGE OF FIRM’S NAME & EXEMPTION FROM SUBSCRIPTION Registered Accountants 36 under Section 8 (2) of the ICAN Act Description Nos. Total Membership as 46,864 at 31st December 2018 a) Marital Ground 172 MORE INFORMATION ON MEMBERSHIP RECORDS b) Other Ground such as 50 (Religion, Tradition, Total membership of the Institute as at 46,864 personal, etc.) 31st December, 2018
Recorded Death as at 31st December 2018 (664) c) Firms 5 Members on pending list due to unresolved issues 4 with the Institute d) Exemption from 22 Subscription Therefore, total membership number as at 46,196 31st December 2018 (Fellows, Associate Members and e) Licence/Attachment Nil Registered Accountants)
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LIST OF DECEASED MEMBERS FOR 2018/2019 PRESIDENTIAL YEAR ASSOCIATION
S/N NAMES MEMBERSHIP OF ACCOUNTING NUMBER 1 EME, Victor Asukwo MB013739 TECHNICIANS WEST 2 AINA, Moboluwaji Oluwaseun MB022439 AFRICA (AATWA) 3 OMODARA, Ronke MB032457 4 ADEKUNLE, Kehinde Olawale MB040838 AATWA INDUCTION CEREMONY 5 OLAOJO, Jacob Ben Adebayo MB005485 Two Induction Ceremonies were held in June and December 2018. A total of 515 and 668 ATSWA 6 AKERU, Francis Ukachukwu MB001925 graduates were admitted into the Association`s 7 DAVID-AGBAERE, Nzubechi MB027452 membership respectively. Therefore, the total 8 BABALOLA, Olufunke Titilayo MB023851 membership strength of the Association as at December 9 ONYIWA, Boniface Chudi MB004405 2018 was 23,695. At both inductions, thought-provoking papers were presented by erudite speakers. 10 NWOKOLO, Godwin Anene MB003345 11 OHAKA, Anthony Nna MB013149 AATWA ANNUAL CONFERENCE 12 IBITOYE, Babatunde Osmond MB006847 The AATWA 23rd Annual Conference was held 13 ADEBEKUN, Isaiah Oloruntosin MB001864 on Thursday, December 12, 2018 at the ICAN 14 AJIDE, Fausat Fadekemi MB021294 Centre, Amuwo Odofin, Lagos. The Conference theme was “BUILDING A GREATER NIGERIA 15 FASEUN, Olaide Ganiyat MB038738 THROUGH INNOVATION, TECHNOLOGY AND 16 KUSHIMO, Theresa Adejoke MB027769 ENTREPRENEURSHIP: THE ACCOUNTING 17 AMUPITAN, Dare Moses MB028817 TECHNICIANS PERSPECTIVE”. The resource person at the conference was Mr. Olutoyin Adepate, MBA, FCA, 18 OLUTAYO, Adeniyi Oluwatosin MB020833 OON who presented a paper on the topic, “Business 19 AJEMBA, Godwin MB021283 Opportunities and Strategies for Accounting 20 BAYERE, Joseph Olorunmaiye MB027431 Technicians: The Current Reality” during a session st 21 ADANRI, Oludare MB019968 chaired by the Institute’s 1 Deputy Vice President, Mrs. Onome Joy Adewuyi, BSc, MSc, FCIB, FCA. The 22 OJO, Emmanuel Adedayo MB014609 Special Guest of Honour was Mr. Emmanuel Itoya 23 OYATOKI, Layi Ramoni MB009786 Ijewere, FCA (PP). A total of 1,158 members attended 24 OLIKO, Awele Edith MB033988 the Conference. 25 AIROYA, Rufus Onime MB022441 26 ADEKANYE, Bukola Oluwafemi MB023523 AATWA ANNUAL GENERAL MEETING The Annual General Meeting of the Association was 27 AGBA, Michael Terkimbi MB025080 held on Wednesday, December 12, 2018 at the ICAN 28 ISHOLA, Mutiat Abiola MB026500 Centre, Plot 12, Kofo Kasumu Street, Amuwo Odofin, 29 AWODEINDE, Idowu Olanrewaju MB004914 Lagos. The meeting was held before the commencement of the Annual Conference where 1,158 members were 30 RAHEEM, Zainab Titilayo (nee Sadiq) MB037540 in attendance. 31 NWANKWO, Ugochukwu Stephen (PP) MB001210 Five (5) members of the Executive Committee retired 32 EKWENUGO, Umeadi Nonso MB002576 in accordance with rule 12 of the Constitution and Bye 33 MAITANMI, Philip Olaleye MB002002 Laws of the Association. All the five vacancies created were filled through an election process in line with 34 OSEJI, Martins Pereowei MB025848 Rule 10 of the Association’s Constitution and Bye Law. 35 NWOKAFOR, Peter Chukwudi MB014553 Details of the results are contained in the minutes of the 36 OLATUNDE, Samuel Folorunso MB003993 2018 Annual General Meeting of the Association. 37 AKINBILE, Victor Olusakin MB012600 38 AYEGBA, Franca Ene MB043741 MEMBERS’ PROFILE UPDATE As part of the Institute’s efforts to regularise its data 39 ELECHI, Onwukwe Eleke MB020374 base and serve its members better, a new members’ 40 FALEYE, Olusola (PP) MB000275 portal was created. The page, www.icanportal.org/ 41 OLAKUNRI, Olutoyin Olusola (PP) MB000142 members is user friendly and enables members to 42 SODIYA, Omolara Abosede MB024828 update their profile seamlessly, register on line for Licence to Practise, Attachment, Confirmation of 43 ONWUBOLU, Friday Enuweninka MB015907 Financial Status, Fellowship, Registered Accountants 44 ONABOLU, Folake MB002825 and make payments, among other functions.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 20 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
ACCOUNTING TECHNICIANS SCHEME WEST AFRICA (ATSWA) The ATSWA Examinations took place in March and September 2018 under the aegis of the Association of Accountancy Bodies in West Africa (ABWA) without any hitch. The five member Institutes that participated in the ATSWA examinations for the two diets in 2018 were Nigeria, Ghana, Liberia, Gambia and Sierra-Leone. The March 2018 diet of the Cross section of inductees examinations took place in the following thirty-four (34) centres: Aba, Abakaliki, Abeokuta, Abuja, Ado-Ekiti, Akure, Awka, Benin City, Calabar, Enugu, Ibadan, Ikorodu, Ilesha, Ilisan, Ilorin, Jalingo, Jos, Kaduna, Kano, Lagos, Lokoja, Makurdi, Mowe, Ogbomosho, Okija, Onitsha, Owerri, Oshogbo, Ota, Port Harcourt, Umuahia, Uyo, Warri and Yenagoa. The breakdown of candidate’s enrolment for March and September examinations are as follows:
Level March 2018 September 2018 PART I 1,920 2,247 PART II 1,499 1,543 PART III 1,134 1,291 TOTAL 4,553 5,081
Merit, Subject and Special prizes were awarded to candidates with outstanding performance in the March 2018 examinations as stated below:
MARCH 2018 DIET (a) MERIT PRIZES
NAME EXAMINATION REGISTRATION POSITION PART NUMBER NUMBER IBIGBAMI ZAINAB OLUYEMI ATS/20181/10557/A AT/114618 1ST PART I ATANRANSHE OLUWASEYI GIDEON ATS/20181/10986/A AT/115662 2ND PART I ADEFUSI OLUWASEUN PRAISE ATS/20181/10328/A AT/115472 3RD PART I NWOSU OLUEBUBE UDOCHUKWU ATS/20181/21074/A AT/113398 1ST PART II ADENIYI MONSURAT ADENIKE ATS/20181/20931/A AT/113451 2ND PART II ADEKEYE STELLA ABIOLA ATS/20181/20768/A AT/114169 3RD PART II AYODELE MORENIKEJI GRACE ATS/20181/30357/A AT/115235 1ST PART III ADETOLA GRACE IMOLEAYO ATS/20181/30644/A AT/111522 2ND PART III OLUSOLA IYANUOLUWA VICTORIA ATS/20181/30014/A AT/111364 3RD PART III
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(b) SUBJECT PRIZES
LEVEL SUBJECT PRIZE WINNER
Basic Accounting Processes Chief (Dr) R.U. Uche’s Prize ATS/20181/10328/A & Systems AT/115472 ADEFUSI OLUWASEUN PRAISE
Basic Accounting Processes Chief (Dr) R.U. Uche’s Prize ATS/20181/10869/A & Systems AT/114837 OBI VIRGINIA OLUCHI
Economics Mrs. I.M. Osiyemi’s Prize ATS/20181/10557/A AT/114618 Part I IBIGBAMI ZAINAB OLUYEMI
Business Law Otunba Abdul Lateef Owoyemi’s Prize ATS/20181/10986/A AT/115662 ATANRANSHE OLUWASEYI GIDEON
Communication Skills Chief C.F.G. Akinwolemiwa’s Prize ATS/20181/10365/A AT/115804 AMAJI CHUKWUEBUKA PATRICK
Principles and Practice of Major-General S.A. Owuama’s Prize ATS/20181/20931/A Financial Accounting AT/113451 ADENIYI MONSURAT ADENIKE
Public Sector Accounting Late F.B. Cardoso’s Prize ATS/20181/21074/A AT/113398 NWOSU OLUEBUBE UDOCHUKWU
Part II Quantitative Analysis Ayo Oni’s Prize ATS/20181/21245/A AT/114250 OBISESAN BLESSING TITILOPE
Information Technology Late Otunba Ayora (Dr.) Bola ATS/20181/21074/A Kuforiji-Olubi’s Prize AT/113398 NWOSU OLUEBUBE UDOCHUKWU
Principles of Auditing Alhaji I.O. Sulaimon’s Prize ATS/20181/30644/A AT/111522 ADETOLA GRACE IMOLEAYO
Cost Accounting U.S. Nwankwo’s Prize ATS/20181/30014/A AT/111364 AHE ANUOLUWAPO TOYIN
Part III Preparing Tax Computation D.B.O. Ogutuga’s Prize ATS/20181/30357/A & Returns AT/115235 AYODELE MORENIKEJI GRACE
Management Chief F.K. Bajomo’s Prize ATS/20181/30836/A AT/111227 OLUSOLA IYANUOLUWA VICTORIA
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(c) SPECIAL PRIZES
► F.I. Ogunjuboun’s Prize for the “Best Qualifying Female Candidate” in March 2018 diet examinations:
Level Name Examination Number Registration Number
Part III AYODELE MORENIKEJI GRACE ATS/20181/30357/A AT/115235
► SILVER SCHOLARSHIP for the “Best Qualifying Candidate” in March 2018 diet examinations:
Level Name Examination Number Registration Number
Part III AYODELE MORENIKEJI GRACE ATS/20181/30357/A AT/115235
SEPTEMBER 2018 DIET
The September 2015 diet of the examinations took place in the following thirty-four (34) centres: Aba, Abakaliki, Abeokuta, Abuja, Ado-Ekiti, Akure, Awka, Benin City, Calabar, Enugu, Ibadan, Ikorodu, Ilesha, Ilisan, Ilorin, Jalingo, Jos, Kaduna, Kano, Lagos, Lokoja, Makurdi, Mowe, Ogbomosho, Okija, Onitsha, Oshogbo, Owerri, Ota, Port Harcourt, Umuahia, Uyo, Warri and Yenagoa.
Merit, Subject and Special prizes were awarded to candidates with outstanding performance in the September 2018 examinations as stated below:
(a) MERIT PRIZES
NAME EXAMINATION REGISTRATION POSITION PART NUMBER NUMBER
FARAYOLA OLUWATOSIN OYINDAMOLA ATS/20182/101481/A AT/117455 1ST PART I
OCHINKE NELLIEKEN ATTAH ATS/20182/100185/A AT/115268 2ND PART I
AFOLABI OLAKUNLE FELIX ATS/20182/100374/A AT/117811 2ND PART I
ADEGBOYE VICTORIA IBUKUNOLUWA ATS/20182/101139/A AT/118058 3RD PART I
ATANRANSHE OLUWASEYI GIDEON ATS/20182/200311/A AT/115662 1ST PART II
AKINOLA TEMIDAYO OLUWAGBEMISOLA ATS/20182/200289/A AT/116134 2ND PART II
ADEFUSI OLUWASEUN PRAISE ATS/20182/200666/A AT/115472 3RD PART II
ADENIYI MONURAT ADENIKE ATS/20182/300184/A AT/113451 1ST PART III
ADEGBITE OLUWAREMILEKUN RASHIDAT ATS/20182/300008/A AT/116974 2ND PART III
ADEKEYE STELLA ABIOLA ATS/20182/300880/A AT/114169 3RD PART III
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(b) SUBJECT PRIZES
LEVEL SUBJECT PRIZE WINNER
Basic Accounting Processes Chief (Dr) R.U. Uche’s Prize ATS/20182/101252/A & Systems AT/117329 SORINMADE ABOLAJI BLESSING
Economics Mrs. I.M. Osiyemi’s Prize ATS/20182/100043/A AT/117538 OGUNDEYI KEHINDE ELIZABETH Part I
Business Law Otunba Abdul Lateef Owoyemi’s ATS/20182/100219/A Prize AT/118184 OYEWO OMOTOLANI ESTHER
Communication Skills Chief C.F.G. Akinwolemiwa’s Prize NIL
Principles and Practice of Major-General S.A. Owuama’s ATS/20182/200311/A Financial Accounting Prize AT/115662 ATANRANSHE OLUWASEYI GIDEON
Public Sector Accounting Late F.B. Cardoso’s Prize ATS/20182/200311/A AT/115662 ATANRANSHE OLUWASEYI GIDEON
Part II Quantitative Analysis Ayo Oni’s Prize ATS/20182/200289/A AT/116134 AKINOLA TEMIDAYO OLUWAGBEMISOLA
Information Technology Late Otunba Ayora (Dr.) Bola ATS/20182/200311/A Kuforiji-Olubi’s Prize AT/115662 ATANRANSHE OLUWASEYI GIDEON
Principles of Auditing Alhaji I.O. Sulaimon’s Prize ATS/20182/300961/A AT/112362 ANAYO ANGEL ULOMA
Cost Accounting U.S. Nwankwo’s Prize ATS/20182/300184/A AT/113451 ADENIYI MONSURAT ADENIKE
Part III Preparing Tax Computation D.B.O. Ogutuga’s Prize ATS/20182/300184/A & Returns AT/113451 ADENIYI MONSURAT ADENIKE
Management Chief F.K. Bajomo’s Prize ATS/20182/300184/A AT/113451 ADENIYI MONSURAT ADENIKE
It should be noted that no candidate satisfied the requirements for winning Chief C.F.G. Akinwolemiwa’s Prize in Communication Skills.
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(c) SPECIAL PRIZES
► F.I. Ogunjuboun’s Prize for the “Best Qualifying Female Candidate” in September 2018 diet Examinations:
Name Examination Number Registration Number
ADENIYI MONSURAT ADENIKE ATS/20182/300184/A AT/113451
► Princess A.A. Adeniran’s Prize for the “Best Qualifying Female Candidate” for the year:
Name Examination Number Registration Number
ADENIYI MONSURAT ADENIKE ATS/20182/300184/A AT/113451
► Alhaja (Mrs.) Shakirat Adepeju Babatunde’s Prize for the “Best Qualifying Male Candidate” for the year:
Name Examination Number Registration Number
ADEGOKE PETER SHOLA ATS/20181/30326/A AT/108877
► SILVER SCHOLARSHIP for the “Best Qualifying Candidate” in September 2018 diet examinations:
Name Examination Number Registration Number
ADENIYI MONSURAT ADENIKE ATS/20182/300184/A AT/113451
Best Qualifying Candidate
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 25 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
of the Commons”, the Chairman of Zenith International Bank, Managing Director of Wema Bank, Representative of MD of First Bank, captains of industry, Royal fathers and other eminent personalities. A total of sixteen countries were represented at this Conference. These are Australia, Benin Republic, Canada, Cote D’Ivoire, Ghana, Kenya, The Gambia, Liberia, Malaysia, Omar, Sierra Leone, South Africa, Togo, United Kingdom, United States of America and the host country, Nigeria. The Institute received good will messages from His Excellency, Muhammadu Buhari, GCFR, President of the Federal Republic of Nigeria, the World Bank, the International Federation of Accountants, Pan Africa Federation of Accountants (PAFA), Association of Accountancy Bodies in West Africa (ABWA), Association of Professional Bodies in Nigeria (APBN), The Institute of Chartered Accountants in England and Wales (ICAEW), Association of National Accountants of Nigeria (ANAN), Office of the Head of Service of the Federation, The Senator Udoma Udo Udoma declaring the conference open Auditor-General for the Federation, Financial Reporting Council of Nigeria and The Emir of Kano, amongst many others. ANNUAL ACCOUNTANTS’ The Conference recorded a total attendance of Four Thousand Seven Hundred and Forty-Five (4,745) delegates CONFERENCE comprising Four Thousand Three Hundred and Forty-Three (4,343) fee paying delegates and Four Hundred and Two (402) The 48th Annual Accountants’ Conference was successfully non-fee paying delegates as against the previous year’s figures held at the International Conference Centre, Abuja and Sheraton of Four Thousand Two Hundred and Thirty delegates (4,230 – Abuja Hotel from Monday, October 1 to Friday, October 5, 2018. fee paying: 3,940 and non-fee paying: 290). The non-fee paying The Conference was declared open by the Special Guest of delegates included the Presidency, Council members, Invited Honour, the President, Commander-in-Chief of the Armed dignitaries, Past Presidents, Past Registrar/Chief Executives, Forces of the Federal Republic of Nigeria, His Excellency Resource Persons, Discussants, Chairmen of Sessions, Muhammadu Buhari, GCFR, who was ably represented by the Committee Members and Staff. Honorable Minister of Budget and National Planning, Senator The attendance was very impressive and unprecedented Udoma Udo Udoma. when compared with figures recorded in the last five years. The Conference had in attendance dignitaries and resource This was in spite of the fact that the period falls within the persons from across the globe which included the IFAC week of the country’s independence, accounting period of President, Ms Rachel Grimes who delivered the Lead Paper most organisations and barely a month to forthcoming World on “Securing Our Shared Future: Avoiding the Tragedy Accountants Congress taking place in Australia.
ICAN President with the three University students that came first, second and third in the essay competition Winner of the brand new Kia Car at the raffle draw, Mr. Emoghene Peter Evoki
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 26 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
the switching company to resolve issues with failed transactions INFORMATION and user friendliness. Additional payment channels were incorporated to have Quick teller, Web pay, PAYDIRECT, Internet Banking Transfer, POS and Mobile. Other secure channels are TECHNOLOGY also being explored for incorporation. The activities of the Information Technology committee focused on the under listed: 2. WEBSITE 1. DEPLOYMENT OF ENTERPRISE A new ICAN website with an enhanced look and feel was RESOURCE PLANNING (ERP) developed and deployed. SOFTWARE The ERP project based on Microsoft Dynamics Navision and 3. CRM, which was initiated two years ago is currently at the post- COLLABORATION SOLUTION The deployment of Teleconferencing/e-meeting solution go-live stage and to achieve full integrated computerisation of across the three office locations in Victoria Island, Ebute-Metta the under listed sections of the Institute’s operations: and Abuja was initiated. The facility has provision for mobility a. Financial Services (G/L, A/C Receivables, Payables, and remote sign-on. Inventory, Budget, Non-Recurrent Asset, etc.); b. Human Resources/Payroll (Payroll, Recruitment, Leave, Training, Performance, Query and Exit Management); 4. MOBILE APPLICATIONS c. Studentship Management (Registration, Exemption and th Accreditation exercise for both ATS and Professional); Mobile applications were deployed for the 48 Annual Accountants’ Conference held last year in Abuja. Efforts are d. Membership Management (Induction, Fellowship, th Attachment, Licence, Firms Registration, Conferences, on to deploy a more robust one for 49 Annual Accountants’ etc.); Conference. e. Travel Management; f. Faculties Management; g. Procurement; 5. MEMBERSHIP CARDS h. Maintenance; This initiative is aimed at providing all members with a means i. Members’ Education and Training Management; of identification by the Institute and grant members access to j. IT Case Management. various benefits provided for members’ by the Institute. These benefits include: Discount with selected Hotels across the Re-Integration of the payment system was carried out with country, Airlines, etc. Cards are produced for new inductees and distributed during the induction ceremonies and also produced and distributed through the district society’s arrangement.
6. COMPUTER BASED TESTING The deployment of Computer Based Testing (CBT) for ICAN examinations is at advanced stage.
7. ONSCREEN MARKING Onscreen marking is a system that enables paper-based examination scripts to be marked and graded electronically. The deployment of this system for ICAN examination is at ICAN President, Razak Jaiyeola and his team in a group photograph with the Acting Registrar General/CEO an advanced stage. of Corporate Affairs Commission Mrs. Azuka Obiageli (middle) in Abuja
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MEMBERS’ EDUCATION AND TRAINING COMMITTEE The philosophy behind MCPE is to prepare and equip professional accountants with the requite skills and competencies required to stay afloat in response to increasing changes and complexities of political, economic, social and technological environment. The impact of these changes on the practice of accounting has been very profound. MCPE is a bold attempt in providing information and education for updating, improving and enhancing the knowledge and professional skills of members. As a professional body dedicated to best practices in accounting, financial management and value creation, the Institute has continuously improved on skills development of its members to deliver high quality services in the public interest. REVIEW OF 2018 ACTIVITIES 2018 training year witnessed the introduction of new sectors and topics that gave participants wider choices and delightful training experience going by the feedback. Despite the challenges experienced, there was a remarkable growth in attendance. A total of one hundred and three (103) seminars ICAN Registrar, John Evbodaghe (left); IFAC President, were conducted successfully in twenty (20) locations across the Rachel Grimes; ICAN President, Razak Jaiyeola; and country as indicated below: Michael Armstrong of ICAEW
Location MCPE CPE EMCPE IN-HOUSE Abuja 5 4 Lagos 24 4 4 36 Akure/Asaba/Calabar/Ilorin/Onitsha/Owerri/Enugu/Aba/Warri/ 12 Jos/Awka/Abeokuta (1 in each location) Uyo/Kano/Kaduna/Ibadan/Benin-City (2 in each location) 8 Port-Harcourt 4 2 TOTAL 53 4 4 42
Below are some of our In-House Clientele: 18. PZ Cussons Nigeria Plc 1. ADDAX Petroleum 19. SAIPEM Contracting Nigeria Ltd. 2. Airtel Nigeria 20. Seven-up Bottling Company 3. Asset Management Corporation of Nigeria (AMCON) 21. Shell Nigeria Exploration & Production Company 4. Animal Care Services Konsults (Nig.) Ltd. Limited (SNEPCO) 5. Chevron Nigeria Limited 22. Stanbic IBTC Bank Plc 6. Dangote Group 23. Sterling Bank Plc 7. Deloitte & Touche 24. Zenith Bank Plc 8. 9mobile 9. General Electric BENEFITS OF MCPE 10. IHS Africa At the end of every year, all members’ record of attendance 11. KPMG Professional Services and participation at MCPE programmes are collated. In addition 12. Lafarge Cement Plc to the enrichment of knowledge and acquisition of new skills, 13. MTN Communications Limited every members whose records confirms attendance and 14. Nigerian Bottling Company Plc participation in MCPE up to the approved minimum credit hours, 15. Nigerian Breweries Plc is considered eligible, apart from other laid down requirements 16. Nigerian Deposit Insurance Corporation (NDIC) to: 17. PriceWaterhouseCoopers Remain on the membership register;
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MCPE TRAINING ATTENDANCE FOR 5 CONSECUTIVE YEARS
PROGRAMME ATTENDANCE S/N 2014 2015 2016 2017 2018 1 MCPE 4,665 5,206 4, 760 4, 328 7, 119 2 EMCPE 106 41 122 185 190 3 CPE 39 184 115 183 307 4 ECPE 39 44 17 – – 5 IN-HOUSE 1,658 1,581 1,882 1, 734 1,970 6 TOPIC SPECIFIC 356 195 248 – – TOTAL 6,863 7,251 7, 144 6, 430 9,586
Obtain a Practicing Licence; workshops organised by other organisations, District Societies’, Apply for transfer to Fellowship; etc, requires the submission of the following: Recommend/Endorse students’ applications for Payment of Accreditation fee as applicable per course by Registration, Exemptions and/or Examinations; and organisations and individuals; Inductions programme; Course programme, reflecting the duration of each Obtain a member’s Practicing Seal. paper; Seminar papers should be forwarded three weeks before MCPE CREDIT HOUR REQUIREMENTS date of seminar for evaluation; Every member of the Institute is required to obtain a minimum Evidence of original attendance of members through of thirty (30) verifiable credit hours in a year. Of these, fifteen attendance sheets signed by participants; (15) must be from structured programmes in line with MCPE Resume of resource persons; training guidelines. Application for monitoring of the programme before the The structured seminars are Mandatory Continuing seminar; Professional Education (MCPE), Continuing Professional Theme of the programme/course outline/topics; Education (CPE), and Executive Mandatory Continuing Target Audience; Professional Education (EMCPE). These are classroom-like Expected number of participants; training designed for the various segments of our members. Date and venue of the programme; and Others are: Annual Accountants’ Conference, World Name of course Coordinator. Congress of Accountants, Academics Conference (ACAF), PAFA Congress, Zonal Accountants’ Conference and Accountancy Members of the Institute’s Monitoring Team shall be present Bodies in West Africa (ABWA) Congress. MCPE credits also at seminars. For any programme outside Lagos, the organiser can be earned by learning on our e-learning platform. will provide transport, accommodation and feeding for the Members could also obtain credit hours from unstructured monitor. The above information must reach the Institute before programmes. Unstructured programmes include seminars, the Seminar/Courses are held. No accreditation will be granted workshops, meetings, etc, organised by either the Institute or retroactively. other organisations, ICAN Annual Dinner, ICAN Annual General All requests for local and international accreditation must Meeting, ICAN Symposia, Council and Committee meetings, comply with the above criteria for the purpose of assessment Examination exercises (Invigilation, marking, extraction and before credit hours can be allocated to such seminars or pool setting), Retreats, Publications in the Institute’s journal, workshops. District Societies meetings, facilitation at MCPE Seminars and other events of the Institute. APPEAL TO EMPLOYERS The MCPE courses are designed to significantly add value MCPE COMPLIANCE to a member’s professional effectiveness and performance at A member of the Institute is required to obtain a minimum of his/her workplace. Employers are therefore urged to graciously 90 credit hours (which could be obtained solely from structured sponsor and release their chartered accountants for these value seminars or a combination of structured and unstructured laden and cost effective MCPE programmes. seminars) over a period of three (3) years. At the beginning of every year, members are advised the details of their credit FEEDBACK hours in the last three years to appraise them on their level of Communication is a two-way flow of information designed to compliance. elicit and arouse a desired reaction from recipients. Therefore, in the course of packaging the programmes, the Institute believes GUIDELINES FOR ACCREDITATION OF that it will enhance the professional competence of its members; NON-ICAN SEMINARS/WORKSHOPS the Secretariat expects constructive reactions and suggestions The Institute’s policy on the assessment of seminars/ that will facilitate and enrich the appraisal process.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 29 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
ICAN MEMBERS’ BENEVOLENT & EDUCATIONAL TRUST FUND ICAN Members Benevolent & Educational Trust Fund was established by the Council of the Institute of Chartered Accountants of Nigeria (ICAN) in 1998 with the following objectives: To promote and invest in Research and Educational development. To give financial assistance to needy members. To support families and dependants of those needy members who have passed on.
CONDITIONS FOR ELIGIBILITY The Management Committee evolved the eligibility conditions listed below for an Applicant to qualify for the grant. The Applicant:- Must be a financial member of the Institute; Must have paid his/her annual subscription to at least the preceding year before his/her incapacitation; The mishap occasioning the request must not be from crime or negligence like arson, murder, manslaughter, use of hard drugs, etc; There must be proof that the member cannot afford his/her immediate needs; and Must route his/her request through his District Society.
CURRENT BENEFITS The minimum amount of benefit to applicant members shall be a sum of Two Hundred and Fifty Thousand Naira (N250,000.00); while the maximum shall be a sum of One Million Naira (N1,000,000.00).
Procedure for Disbursement of Fund to Applicants: a) An application received from a prospective beneficiary must state the estimate of his/her needs. Such an application must be endorsed by the Chairman of the District Society of the Applicant; b) For an application to be validly considered by the Management Board, the application will be considered and treated at any meeting where at least (2) two members of the Board are present; c) The Secretary shall be responsible for processing and issuance of cheque for the amount approved; d) All cheques shall be crossed and made payable only to the account of the payee or made payable to the beneficiary through his/her District Society unless otherwise decided by the Board; and e) All failed/rejected applicants will be informed of the reason for failure/rejection.
ACTIVITIES OF THE FUND’S MANAGEMENT BOARD IN YEAR 2018 The major activities of the Management Board are fund raising and management of the Fund’s investments. Funds so generated are invested and the income from the investments are disbursed to members in need and families that are distraught. Since inception, the fund has assisted members and families of dead members.
OTHER OBJECTIVES OF THE FUND In pursuant of the fund’s third objective i.e. “To Promote and Invest in Research and Educational Development”; the Management Board of the ICAN Members’ Benevolent & Educational Trust Fund approved the sum of N90,000.00 to sponsor the prizes of the two PhD Colloquium award winners at the 4th Annual International Academic Conference held in April 2018 at Covenant University Otta organised by the Technical & Education Directorate of the Institute.
SOURCES OF INCOME The main source of funding the Trust is through: i) Annual subvention from the Institute – by way of 3% of the Gross income from the Annual Accountants’ Conference. ii) Income from investment of the Funds Seed Funds.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 30 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
iii) Donations from Members and other interested individuals.
In a bid to facilitate No. (iii) above, The Management Board have been showcasing the activities of the ICAN Members Benevolent & Educational Trust Fund. In order to generate more funds, Letters of appeal for financial assistance towards the scheme are written to individuals and organisations. Responses in this regard have not been encouraging.
ASSISTANCE GRANTED TO MEMBERS IN 2018 In 2018, six (6) applications were received, five (5) were granted as tabulated below:
S/No Beneficiaries’ District/Location Purpose Amount Granted 1. Abuja & District Society Support for the family of a deceased N500,000.00 member 2. Akura & District Society Ailment N500,000.00 3. Ojo Badagry & Agbara (Oba) & District Society Ailment N500,000.00 4. Abuja Educational support for the son of a N93,400.00 deceased member (Scholarship) 5. Onitsha Educational support for the son of a N81,300.00 kidnapped member (Scholarship)
N1,674,700.00
We hereby wish to inform members to endeavour to continue to assist in creating awareness about the purpose and benefits of ICAN Members’ Benevolent & Educational Trust Fund among the members of their respective district societies. This is important so as to aid the Fund’s Management Board in its repeated appeal to members for donations. It will also facilitate the desire to touch more lives and make its assistance more effective.
We seize this opportunity to inform indigent members in need of financial assistance not to hesitate to approach the Fund’s Management Board through the Chairmen of their respective District Societies for the purposes narrated above.
Alhaji Razak Jaiyeola with some Past Presidents at a Luncheon
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 31 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
development in the Nigerian economy, given the realities of the international economic situation. RESEARCH, The Discourse which had 424 attendees had Dr. Ayo Teriba, CEO, Economic Associates, as the guest speaker. The TECHNICAL AND Discourse had four panelists: Mr. Ben Akabueze, FCA, D-G Budget Office, Abuja; Mr. Henry Boyo, Economist; Dr. Mark PUBLIC POLICY Abani, Founder/CEO, MSCA Worldwide Projects; and Mr. Yomi Olugbenro, FCA, Partner, Deloitte, ably represented by Mr. O. In keeping with her responsibility of conducting research Arowolo, FCA, Partner, Deloitte. into Accounting, Taxation, Auditing, Finance, Economics and The communiqué of the Discourse formed part of the related disciplines, to expand the frontiers of knowledge in the recommendations made to the Federal Government on the profession and deliver results based on her terms of reference, 2019 FGN Budget. the Committee’s activities during the year were in the following areas: RESEARCH JOURNALS ACADEMIC CONFERENCE The Committee maintained the production of International The 5th edition of the ICAN Annual International Academic Journal of Accounting & Finance (IJAF). The journal has been Conference was organised in collaboration with Kaduna State accepted for indexing in EBSCO host and RepEc. In addition, University, Kaduna, Kaduna State from April 15-18, 2019. The the department has applied for indexing in African Journal Online 3-day conference brought together 152 scholars from across (AJOL) and SCUPOS. A Separate website has been created for the country and abroad with the aim of projecting the image the journal in line with other academic journal outlets. of the Institute as an educator on one hand, and also provide The Volume 7, Number 1 (September 2018 edition) of the a platform for scholars in academia both in the accountancy journal was produced and copies were sold at the 2018 Annual profession, and related fields to broaden their knowledge as Accountants’ Conference. Also, the special conference edition well as enhance their research skills. The conference provided of the Journal (Volume 7, Number 2, December 2018 edition) a publication outlet for well-researched manuscripts. Papers was produced and two copies of the journals were sent to each presented at the conference were published as Conference higher institution in Nigeria. Preparation for the 8th edition has Proceedings and a selected few published as a Special Edition commenced and articles for the journal may be submitted via of the International Journal of Accounting & Finance (IJAF). [email protected] and [email protected].
ICAN ECONOMIC DISCOURSE SERIES PRODUCTION OF TECHNICAL BULLETIN The Committee, on behalf of the Institute, successfully The Technical Bulletin was reactivated during the year. organised the 5th edition of the Economic Discourse Series Four quarterly editions of the bulletin were produced and during the period under review. The event was held on communicated to members and hosted on the Institute’s website: Thursday, February 7, 2019 at MUSON Centre Onikan, Lagos a) Volume 1, Number 1 (January 2018) – Financial with the Theme: 2019 Economic Outlook. The objective of Instruments: Goodbye 39, Welcome 9! the Discourse was to critique the major indices of growth and b) Volume 1, Number 2 (May, 2018) – features topics on the Passage of the 2018 Budget by the National Assembly and The FGN Whistle-Blower’s Policy. c) Volume 1, No. 3 (December 2018) – with two impactful topics: IFRS 15: Revenue from Contracts with Customers; Compliance Requirements for 2018 Interim and Year-end Financial Statements and Integrated Reporting. The Volume 2, Number 1 of 2019 has been concluded and is awaiting publication by the Research and Technical Department.
AWARD OF PHD RESEARCH GRANTS TO MEMBERS IN ACADEMIA The Institute continued with the determined effort to encourage ICAN President with dignatories at the 2019 ICAN Economic Discourse members in the academia to
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 32 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
pursue a PhD programme in accounting and finance related fields. The Institute received a total of 30 applications within the presidential year. Council successfully awarded grants to 20 applicants who met the criteria set by Council for the award of PhD Research Grants.
ICAN SPONSORSHIP OF INAUGURAL PROFESSORIAL LECTURE To encourage members in academia to aspire to the highest position in their academic career, the Council of the Institute approved the sum of N1million grant to eligible applicants for inaugural professorial lecture presentation. During this Presidential year, awards were made to three members who are Professors of Accounting Courtesy visit to the Minister for Budget and National Planning, Senator Udoma Udo Udoma in Abuja as follows: i) Professor Chinwuba Okafor, FCA of University of Benin, tertiary institutions in the training of future accountants in Edo State. His inaugural lecture titled: “Mentoring, Nigeria. The scheme enables accredited tertiary institutions Teamwork, Reconcillation Models and Organisational that sign up to the agreement to enjoy special and expanded Effectiveness – A Call for Paradigm Shift in exemptions from all subjects in Foundation and Skills levels Accounting Profession and Nigeria” was delivered on of the professional examinations. This implies that Accounting 2nd of August, 2018. graduates under the MCATI scheme proceed to the final level of the professional examination and only write five (5) subjects to ii) Professor Onafowokan O. Oluyombo, FCA of Pan- qualify as chartered accountants. Atlantic University, Lagos. His inaugural lecture titled: To date, the following institutions have signed the agreement “The Accounting Profession: Throw Back, Throw In with the Institute: and Throw Out” was delivered on 31st January, 2019. 1. Abia State Polytechnic, Aba, Abia State. iii) Professor Ishola Rufus Akintoye, FCA of the Department 2. Babcock University, Ilishan Remo, Ogun State. of Accounting, Babcock University, Illisan, Ogun State. 3. Caleb University, Imota, Lagos State. His inaugural lecture titled: “Accounting: A Mismanaged Concept Requiring Urgent Re-definition” was held on 4. Covenant University, Ota, Ogun State. 4th April, 2017. 5. Elizade University, Ilara-Mokin, Ondo State. 6. Federal University, Birnin-Kebbi, Kebbi State. 7. Michael Okpara University of Agriculture, Umudike, COMMENTS ON EXPOSURE DRAFTS (EDS) Abia State. AND PRESENTATION OF MEMORANDA AT 8. Nigeria Police Academy, Wudil, Kano State. PUBLIC HEARINGS 9. Yusuf Maitama Sule University, Kano, Kano State Comments on the following Exposure Drafts were forwarded to the relevant bodies and presentation of Memoranda were (formerly: North-West University, Kano). made at Public hearings held at the National Assembly Complex, 10. University of Benin, Benin City, Edo State. Abuja. Comments were submitted on seven Exposure Drafts 11. Yobe State University, Damaturu, Yobe State. issued within the period. 12. Joseph Ayo Babalola University, Ikeji Arakeji, Osun State. MUTUAL COOPERATION AGREEMENT WITH 13. Osun State University, Osogbo, Osun State. TERTIARY INSTITUTIONS (MCATI) 14. Pan Atlantic University, Lekki, Lagos State. The Institute’s Mutual Cooperation Agreement with Tertiary 15. University of Nigeria, Nsukka, Enugu State. Institutions (MCATI) Scheme was developed to partner with 16. Benson Idahosa University, Benin City, Edo State.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 33 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
expertise to enhance their work. In furtherance of the Faculty’s mandate to train and certify its members for proficiency and FACULTIES authority in specialised skills, the Faculty conducted two (2) First launched in 2001 as the millennium was set to unfold, the streams of two-modular certification training programme for Faculties were created to provide technical support to members a total of 14 members out of which eight (8) members have based on their peculiar needs. One key objective for creating been certified for induction. In addition, as part of its capacity Faculties is to help the Institute regulate the practice of special building function, the Faculty organised forum of members on branches of accountancy in which some members operate as well “Financial Technology (FinTech) Opportunities and Threat as open more channels of communication between the Institute for Members,” with 70 members in attendance. and its members that perform various specialised functions in the economy. To Members, the Faculties serve as repository 4. FINANCIAL REPORTING FACULTY of technical resources from which members can draw as they Further certification training programmes for members and grapple with the challenges of their professional assignments. other interested members of the public on: “International It helps to complement the technical information available to the Financial Reporting Standards (IFRS)” were conducted firms of chartered accountants and other corporate members. during the year under review. The Faculty trained 104 members Above all, the Faculties continuously strive to educate members on IFRS in Lagos, Abuja, and Port Harcourt. It also conducted on their peculiar statutory duties and responsibilities such that examination in Lagos, Abuja and Port Harcourt for eligible a culture of best practice is evolved in each specialised area of candidates on July 19 and November 29, 2018. To date, the accountancy practice. These functions are being carried out on Faculty has awarded 266 members with Certificate of Proficiency regular basis through various training programmes, conferences, in International Financial Reporting Standards (IFRS). seminars, and workshops for members in their different areas of professional interest. During the period under review, the 5. INSOLVENCY AND CORPORATE Faculties undertook the following activities: RE-ENGINEERING FACULTY The Faculty continued its capacity building and development 1. AUDIT, INVESTIGATIONS AND FORENSIC programmes for members to effectively perform their specialised ACCOUNTING FACULTY function in the economy. It conducted its two-part certification This Faculty facilitates networking amongst chartered training programme for the award of Certified Insolvency accountants in this sector such that their unique needs can be Practitioner (CIP) during the year in Lagos and Abuja. A total identified, collated and satisfied. During this period, it conducted of 23 members were trained during the year, while 16 members Six (6) streams of six-modular certification training programme passed the certification examination, bringing the number of for a total of 98 members. Moot court session was held in Lagos Certified Insolvency Practitioners to Ninety-four (94). on Tuesday November 27, 2018 with a total number of 65 candidates in attendance. The session exposed participants to 6. PUBLIC FINANCE MANAGEMENT simulated court scenarios with a view of grooming them towards FACULTY becoming expert witnesses. Qualifying examination was held Membership of the Faculty enhances members’ technical on November 28, 2018 in Lagos and Abuja. The Faculty also and professional skills and also gives members access to a wide organised a one-day seminar during the year with the theme: range of materials that will help them have the edge they need “Technology as the New Face of Audit” in Lagos with 61 to excel in any public finance management role. The Faculty members in attendance. As at the 10th induction ceremony on continued to sensitise members and key players in the public May 2, 2019, a cumulative total of 613 members have been sector on the adoption of accrual basis International Public inducted as Certified Forensic Accountants of Nigeria (CFAN). Sector Accounting Standards (IPSASs). To this end, six 3-day training programmes on accrual basis implementation was 2. CONSULTANCY AND INFORMATION organised in major cities in Nigeria, while a 4-day training was TECHNOLOGY FACULTY organised in Dubai, UAE for members and Non-ICAN members. The Faculty provides to its members up-to-date information, A total of 142 members and Non-ICAN Members participated news and guidance on a wide range of issues including advice in the IPSASs training. In addition, as part of its sensitisation on analytics, cyber security, data protection and other IT related programmes, the Faculty also organised forum of members issues. In the period under review, the Faculty organised with the main theme: “Accountability, Transparency and forum of members on: “Cyber Security Challenges, Artificial Budgeting in Nigeria” and sub theme: “Pension Reform Act Intelligence (AI) and the Future of Accounting and Block 2014 and Efficacy of Pension Administration in Nigeria.” Chain Technology” for members in Lagos and Abuja. This is to The forum recorded 74 members in attendance. enhance efficiency and technical competence of members in their workplaces as well as awaken their consciousness to emerging 7. TAXATION AND FISCAL POLICY cyber security challenges and disruptive technology. A total of MANAGEMENT FACULTY 94 participants were recorded at the two locations. Meanwhile, Membership of Tax Faculty helps members to be on top of the faculty continues its certification training programme towards the ever-evolving world of tax with timely material, guidance producing Certified Financial and IT Consultants (CFICs). and supports. The Faculty also facilitates networking amongst members. As part of its capacity building programmes, the Faculty 3. CORPORATE FINANCE MANAGEMENT organised seminars on topical issues on taxation and fiscal FACULTY policy in Lagos, Abuja and Ado-Ekiti in the year under review. A Membership of the Corporate Finance Faculty gives total of 255 members attended the seminars. The Faculty also members access to the latest developments on emerging issues released newsletters on Tax matters, such as reports from Tax in the corporate world, best practice guidance and professional Appeal Tribunal and topics of professional significance.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 34 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
centre produced a total number of14 qualified candidates out of STUDENTS’ the 56 candidates that wrote the final level of the examination at the centre. The Centre also produced prize winners in two subjects SPECIAL PROJECT – Public Sector Accounting and Business & Finance at CHARTERED ACCOUNTANTS PRODUCED Foundation and Skills levels respectively. BY CENTRES TO DATE By November 2018 Diet Examination, the following number of Chartered Accountants had been produced: OBJECTIVES OF SSP The objectives of the Students’ Special Project are: ICAN/NNDC Study Centre, Kaduna produced 20 ► To identify areas and indigenous students of educationally Chartered Accountants bringing the total from inception less developed parts of the country; to date to 290; ► To expand studentship in educationally less developed ICAN/NNDC Study Centre, Kano produced Chartered 20 parts of the country; Accountants bringing the total from inception to date to ► To facilitate establishment of standard tuition centres in ; 291 these areas; ICAN/NNDC Study Centre, Ilorin produced Chartered 27 ► To create awareness in these areas about the availability Accountant bringing the total from inception to date to of such a scheme; ; 288 ► To encourage States, Local Governments, Private- and ICAN/NNDC Study Centre, Gombe produced 11 Public Sector- Institutions to provide facilities for standard Chartered Accountants bringing the total from inception tuition centres, grant scholarships, bursary awards and in 2015 to date to ; 25 other assistance to deserving indigenous students in ICAN/BYSG Study Centre, Bayelsa produced Chartered 6 educationally less developed areas of the country; and Accountants bringing the total from inception to date to ► To encourage and assist indigenous students in 112; educationally less developed parts of the country to ICAN/CRSG Study Centre, Calabar produced 12 take the Institute’s Examinations with a view to rapidly Chartered Accountants bringing the total from inception producing a desirable number of Chartered Accountants to date to 172; there from. ICAN/AKSG Study Centre, Uyo produced 14 Chartered Accountants. In the last twelve years, the SSP Committee anchoring the project, which comprises members from different parts of the This was made possible due to the cooperation of country, has worked assiduously towards attaining the foregoing stakeholders, dedication of the staff at the centres and the objectives. commitment of the members of the respective District Societies who sacrificed their time to lecture at the various centres. ICAN BUILDING PROJECTS Council has approved in principle the construction of District PARTNERS ON THE PROJECTS SO FAR Society Office Buildings for Onitsha and Offa District Societies of through New Nigeria Development Company Ltd. the Institute as projects to be funded jointly by the Institute and which four (4) centres were established as follows: the donors sourced by the Districts under a 50-50 arrangement. — NNDC/ICAN Study Centre, Kaduna; In the light of the pledge by the donors to provide the — NNDC/ICAN Study Centre, Kano; counterpart funds, the Institute will proceed with the construction — NNDC/ICAN Study Centre, Ilorin; and of the approved buildings, while lining up the requests from — NNDC/ICAN Study Centre, Gombe sponsored by other districts subject to provision of land, donors, necessary
Gombe State Government. approval and availability of funds. The Bayelsa State Government through which BYSG/ ICAN Study Centre, Yenagoa was established. The centre is currently administered by the Yenagoa and District Society.
The Cross River State Government through which CRSG/ICAN Study Centre, Calabar was established. The centre was officially handed over to the Cross River State Government in February 2013.
NEW CENTRE – AKWA IBOM STATE GOVERNMENT/ICAN STUDENT’S SPECIAL PROJECT STUDY CENTRE The new centre commenced full operations on July 16, 2018 in preparation for November 2018 diet. At this first attempt, the
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 35 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
Polytechnics STUDENTS’ AFFAIRS 1. Abubakar Tatari Alli Polytechnic, Bauchi, Bauchi State DIRECTORATE 2. Delta State Polytechnic, Otefe-Oghara, Delta State 3. Federal Polytechnic, Bauchi, Bauchi State 4. Federal Polytechnic, Nasarawa, Nasarawa State REGISTRATION/EXEMPTION 5. Federal Polytechnic, Offa, Kwara State A total of Nine Thousand, Seven Hundred and Twenty- 6. Imo State Polytechnic, Umunagwo-Ohaji, Imo State three (9,723) students were registered during the year under 7. Jigawa State Polytechnic, Dutse, Jigawa State review. This brings the total number of registered students to 8. Moshood Abiola Polytechnic, Abeokuta, Ogun State Two Hundred and Thirty-three Thousand, Two Hundred 9. Ogun State Institute of Technology, Igbesa, and Seventy-seven (233,277) as at February 2019. Seven Ogun State Thousand, Five Hundred and Fifty-two (7,552) were granted 10. Osun State Polytechnic, Iree, Osun State exemptions from various levels of the Professional Examination 11. Plateau State Polytechnic, Barkin-ladi, Plateau State from March 2018 to February 2019. Four Thousand, and 12. Rufus Giwa Polytechnic, Owo, Ondo State Thirty-three (4,033) students were registered for the Accounting 13. Trinity Polytechnic, Uyo, Akwa-Ibom State. Technicians Scheme West Africa (ATSWA) in the year under review bringing the total number of registered ATSWA students to One Hundred and Twenty Thousand, and Forty-eight Colleges of Education (120,048) while Four Hundred and Thirty-eight students (438) 1. Adeyemi College of Education, Ondo, Ondo State were granted exemption from various levels of ATSWA. 2. Federal College of Education (Technical), Akoka, Lagos State 3. Institute of Ecumenical Education, Enugu, Enugu State. ACCREDITATION Twenty-four (24) Universities, Thirteen (13) Polytechnics and Three (3) Colleges of Education which met the required Tuition Houses educational standard of the Institute were accorded full 1. Achievers Tutors Nig. Ltd, Gwalalada, Abuja accreditation status during the year, while Nineteen (19) Tuition 2. ABUAD Tuition Centre, Ado-Ekiti, Ekiti Centres were granted full/interim recognition as approved 3. Best-Rank Professional Tutors, Benin City, Edo State training centres for the Institute’s Examination. The Institutions 4. Crown Academy, Iju, Obawole, Lagos State are: 5. CIP Consulting, FCT, Abuja 6. Ehibram International Consultancy Ltd, Abule-Odu, Universities Idimu, Lagos State 1. Adamawa State University, Mubi, Adamawa State 7. First Attempt Associate, Uyo, Akwa Ibom 2. Afe Babalola University, Ado-Ekiti, Ekiti State 8. First Class Associates Tutors, Ojo, Lagos State 3. Ahmadu Bello University, Zaria, Kaduna State 9. Hedge Professional Services Limited, Garki, Abuja 4. Ajayi Crowther University, Oyo, Oyo State 10. Legend Business School, Ogombo, Ajah, Lagos State 5. Ambrose Alli University, Ekpoma, Edo State 11. London College of Science and Technology, 6. Bingham University, Karu, Nasarawa Ikeja, Lagos 7. Caritas University, Enugu, Enugu State 12. Management Education & Training, Ikeja, Lagos 8. Crawford University, Igbesa, Ogun State 13. NOMBA Ltd, Ikorodu, Lagos State 9. Edo University, Iyamho, Edo State 14. QPSY Consult Limited, Festac Town, Lagos State 10. Ekiti State University, Ado-Ekiti, Ekiti State 15. Pointon Academy, Kubwa, FCT, Abuja 11. Godfrey Okoye University, Ugwuomu Nike, 16. Risk Free Standard Associates Limited, Ilupeju, Enugu State Lagos State 12. Kaduna State University, Kaduna 17. Squad Associate, Ogba, Lagos State 13. Kwararafa University, Wukari, Taraba State 18. Spring Board Associates, Ilorin 14. Landmark University, Omu-Aran, Kwara State 19. Unique Professional Tutors Ltd, FCT, Abuja. 15. Lead City University, Ibadan, Oyo State 16. Mcpherson University, Seriki Sotayo, ICAN SCHOLARSHIP SCHEME Ogun State The Institute has put in place a strategy which will make 17. Oduduwa University, Ipetu Modu, Osun State Accountancy Profession more attractive to the brightest 18. Redeemer’s University, Ede, Osun State youths from all Universities and Polytechnics. The scholarship 19. Tansian University, Umunya, Anambra State programme is to elicit the interest of Nigerian youths as well as 20. Taraba State University, Jalingo, Taraba State attract the best brains in the Accountancy Profession. This is 21. University of Ilorin, Kwara State also in compliance with the social responsibility programme of 22. University of Lagos, Akoka, Lagos State the Institute to the society. 23. University of Maiduguri, Maiduguri, Borno State A total of Two Hundred and Fifty-eight (258) students 24. Wellspring University, Benin-City, benefitted from the Scholarship Scheme. They sat for various Edo State (Interim) levels of the Professional Examination in May and November 25. Nigeria Army School of Finance and Administration, 2018, bringing the total number of beneficiaries to Seven Apapa, Lagos State Hundred and Fifty-nine (759). 26. Wesley University, Ondo State. Ten (10) students benefited under the ATSWA (Silver)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 36 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
category in March and September 2018. Detailed information on the Scheme for all interested and qualified students can be obtained from the Institute’s website. CATCH THEM YOUNG PROGRAMME The Catch Them Young Programme is an initiative designed to: Create awareness among students about the career opportunities available to them through the Institute of Chartered Accountants of Nigeria’s platform. Take ICAN to the grassroots with a view to “catching them young”. Promote the sense of self-employment/ entrepreneurship, future prospects and personal interest among the students. Create a sense of commitment to excellence among students and teachers of commercial subjects in secondary schools. ICAN President, Razak Jaiyeola courtesy visit to the Executive Chairman, Ogun State Enhance the quality of commercial Internal Revenue Service (OGIRS), Alhaji Adekunle Adeosun education in our Secondary Schools. Promote a platform for socio-academic interaction among 26. Ijebu-Ode — January 22, 2019 the commercial Secondary School students. 27. Osun — January 23, 2019 28. Otta — February 5, 2019. Consequently, it is to provide support for the career development of the students sitting for the Accounting Technicians’ Scheme West Africa (ATSWA) and eventually, the STUDENTS AWARENESS PROGRAMME Professional Examinations of the Institute. The Students Awareness Programme is a programme The Institute had conducted the programme in Thirty-four (34) for all accounting and non-accounting students who desire states in the country including the Six (6) Educational Districts in to pursue accountancy as a profession. The programme is Lagos State since inception in 2014 and still counting. designed to encourage the best and brightest students to In 2018, the programme was conducted in Twenty-eight (28) make a career in accountancy and also leverage its limitless locations, namely: possibilities, opportunities and benefits of earning the Chartered 1. Gateway Sapade — January 24, 2018 Accountant’s qualification of ACA. The programme is structured 2. University of Ilorin — January 29, 2018 to prepare students for the many opportunities that lie ahead in 3. SWAN (Awumo) — January 31, 2018 the corporate setting. 4. Ijebu-Ode — February 6, 2018 The programme was also conducted during the accreditation 5. Maiduguri — March 7, 2018 exercise in Forty-two (42) tertiary institutions across the nation, 6. Kontagora — March 22, 2018 including a special awareness programme that took place during 7. Epe — April 26, 2018 the orientation programme of Faculty of Management Sciences 8. Lantang — April 26, 2018 in LASU, Ojo and Obafemi Awolowo University (OAU), Ile-Ife. 9. Mowe — May 10, 2018 10. Nsukka — June 5, 2018 SYLLABUS REVIEW 11. Awka — October 11, 2018 The Syllabus Review Technical Committee in conjunction 12. Offa — October 17, 2018 with Students’ Affairs Committee completed the review of the 13. Lokoja — October 17, 2018 new syllabus which would take effect from 2019 November diet 14. Ikeja — October 25, 2018 of the Institute’s Examination. The Students’ Affairs Directorate 15. LASU — October 30, 2018 carried out sensitisation programme on the new syllabus from 16. Umuahia — October 31, 2018 August 3 – 17, 2018 at six (6) locations namely: Lagos, Abuja, 17. Ojo (Badagry) — November 7, 2018 Enugu, Port-Harcourt, Ibadan and Kano. 18. Auchi — November 8, 2018 19. Calabar — November 21, 2018 20. Ilorin — November 27, 2018 STUDY TEXT PREPARATION 21. Abraka — November 28, 2018 The Syllabus Review Implementation Committee saddled with 22. Enugu — November 22, 2018 the responsibility of facilitating the preparation and production 23. Zaria — December 6, 2018 of study texts commenced work in July 2018 and the process 24. Warri — December 11, 2018 has reached an advanced stage of about 80% completion as at 25. Ansar-Ud-deen — January 19, 2019 February 2019.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 37 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
PROFESSIONAL EXAMINATIONS The Professional Examinations took place in May and November 2018 with 18,512 and 19,701 candidates, respectively. They were conducted in Fifty (50) Centres in various parts of Nigeria, one centre each in Cameroon and London. The Institute continued to enhance the Information Technology deployment to the examination processes and the effect was tremendous. The breakdown of the candidates for both examinations is stated below:-
Level of Examinations May 2018 Level of Examinations November 2018 FOUNDATION 1,825 FOUNDATION 2,083 SKILLS 9,593 SKILLS 9,818 PROFESSIONAL 7,094 PROFESSIONAL 7,800
TOTAL 18,512 TOTAL 19,701
MAY 2018 DIET (a) MERIT PRIZES
FOUNDATION
Name Examination No. Registration No. Award
AKINBORO MUBARAQ AKINSOLA 20181/101199/F/234 222345 1st
CHIMA DANIEL IFEANYI 20181/101456/F/12345 220245 2nd
ETIKE CHIKODI RITA 20181/101473/F/234 223605 3rd
SKILLS
Name Examination No. Registration No. Award
BAKARE OLUMIDE BABATUNDE 20181/207317/S/1456 178868 1st
ADEOGUN ESTHER ADENIKE 20181/207803/S/1456 223293 2nd INYANG AMOS EKONG 20181/202861/S/1456 225859 2nd
ADEBAYO SEGUN KAYODE 20181/209400/S/1456 226316 3rd ALERAH NKWACHI PROMISE 20181/209488/S/1456 226518 3rd
PROFESSIONAL
Name Examination No. Registration No. Award
EIGBEFOH MOYOSOREOLUWA ADESUA 20181/306994/P/12345 226020 1st
ALEKE SIMEON ABIODUN 20181/304048/P/12345 220878 2nd
AZEEZ MARIAM OMOLARA 20181/303816/P/12345 218980 3rd
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 38 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
(b) SUBJECT PRIZES
Level Subject Prize Winner FOUNDATION 20181/100468/F/234 223975 Financial Accounting Late Sir John A. Balogun SOYEBO KOLADE ABIODUN I.O. Sulaimon 20181/101199/F/234 222345 Business Law Princess A.A. Adeniran AKINBORO MUBARAQ AKINSOLA Economics & Business M.B. Taiwo 20181/101130/F/2345 223775 Environment/Business J.A. Owoseni ADEYEMI OLUWAPELUMI OLUWANIFEMI & Finance Quantitative Techniques 20181/100685/F/12345 225580 M. Ayo Oni in Business AYODELE TEMITOPE EMMANUEL Late Chief E.F. Oke 20181/101473/F/234 223605 Management Information Late Prof. M.A. Adeyemo ETIKE CHIKODI RITA SKILLS 20181/208347/S/123456 216156 MONYE JUDITH IFEYINWA Taxation Late Z.O. Ososanya 20181/200858/S/123456 220327 ODIONYE CHUKWUEMEKA CHUKWUEBUKA 20181/202489/S/123456 219902 OKON JENNIFER ASIKPO Auditing and Assurance N.L. Westgarth 20181/207479/S/123456 219870 MACIVER RASHIDAT BOLANLE Business Comm. and Sir (Chief) Ike Nwokolo Nil Research Methodology 20181/208437/S/1456 210460 Performance Management G.J. Burk OGBONNA JEREMIAH NDUBUISI 20181/202366/S/1456 223239 Financial Reporting S.B. Baylis-Smith OZIOKO VALENTINE IFEANYI 20181/207317/S/1456 178868 Management, Governance BAKARE OLUMIDE BABATUNDE PricewaterHouseCoopers & Ethics 20181/205974/S/1456 221813 SULE JOHN Public Sector Accounting Late Balogun J.O. 20181/204686/S/123456 218707 & Finance Omidiora ORISAN HANNAH TOSIN PROFESSIONAL 20181/304048/P/12345 220878 Arthur Young, Osindero ALEKE SIMEON ABIODUN Corporate Reporting & Moret 20181/303816/P/12345 218980 AZEEZ MARIAM OMOLARA Advanced Audit 20181/306994/P/12345 226020 J.M.T. Morris & KPMG & Assurance EIGBEFOH MOYOSOREOLUWA ADESUA Strategic Financial Late Bola Kuforiji-Olubi 20181/306994/P/12345 226020 Management Elder M.E. Daniels EIGBEFOH MOYOSOREOLUWA ADESUA Akintola Williams & Co. 20181/305848/P/12345 221196 Advanced Taxation Olushola Adekanola BABATUNDE MOJEED ORIYOMI 20181/304756/P/12345 206834 ANENE AWELE JOY Case Study KPMG 20181/302895/P/12345 211336 DEGAN RACHEAL ONYEKACHI
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 39 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
(c) SPECIAL PRIZES
► SWAN Prize for the best qualifying female candidate for the diet:
Level Name Examination No. Registration No. PROFESSIONAL EIGBEFOH MOYOSOREOLUWA ADESUA 20181/306994/P/12345 226020
► Akintola Williams Delloite and Touche Prize for the best qualifying candidate in a diet:
Level Name Examination No. Registration No. PROFESSIONAL EIGBEFOH MOYOSOREOLUWA ADESUA 20181/306994/P/12345 226020
► Akintola Williams Prize for the best qualifying candidate for the year:
Level Name Examination No. Registration No. PROFESSIONAL N/A N/A N/A
NOVEMBER 2018 DIET (a) MERIT PRIZES
FOUNDATION
Name Examination No. Registration No. Award
ODUKOYA RILWAN TOSIN 20182/102009/F/12345 229103 1st
AROGUNDADE MARIA OLUMAYOWA 20182/101638/F/234 230719 2nd
FOLARIN-LAWAL BISOYE AMINAT 20182/101701/F/234 225603 3rd
SKILLS
Name Examination No. Registration No. Award
AFEME CHRISTIANA ENIWOEVA 20182/208043/S/1456 226105 1st
OGUNDUNMADE GBEMISOLA OLAITAN 20182/208711/S/1456 225429 2nd ADETOLA GRACE IMOLEAYO 20182/201863/S/1456 229891 2nd
OLUSOLA IYANUOLUWA VICTORIA 20182/202328/S/1456 229401 3rd
PROFESSIONAL
Name Examination No. Registration No. Award
LAWAL OLUWAFEMI MOSES 20182/304330/P/12345 225150 1st
EHIGIEGBA PROMISE TOSIN 20182/302375/P/12345 218797 2nd
RUFAI IDOWU LAWAL 20182/304696/P/12345 221902 3rd
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 40 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
(b) SUBJECT PRIZES
Level Subject Prize Winner
FOUNDATION
20182/102009/F/12345 229103 Financial Accounting Late Sir John A. Balogun ODUKOYA RILWAN TOSIN
I.O. Sulaimon 20182/101638/F/234 230719 Business Law Princess A.A. Adeniran AROGUNDADE MARIA OLUMAYOWA
Economics & Business M.B. Taiwo 20182/101934/F/2345 228729 Environment/Business J.A. Owoseni OLAYENI-DEJO EYITAYO FRANCIS & Finance
Quantitative Techniques 20182/101824/F/12345 229142 M. Ayo Oni in Business ONWUJIOBI CHARLES ONYEDIKACHI
Late Chief E.F. Oke 20182/102009/F/12345 229103 Management Information Late Prof. M.A. Adeyemo ODUKOYA RILWAN TOSIN
SKILLS
20182/206903/S/123456 216972 Taxation Late Z.O. Ososanya OKA SAMUEL OLORUNFEMI
20182/201648/S/123456 222315 Auditing and Assurance N.L. Westgarth ADEJARE OLUWAFEMI VICTOR
20182/208043/S/1456 226105 Performance Management G.J. Burk AFEME CHRISTIANA ENIWOEVA
20182/205324/S/1456 231003 Financial Reporting S.B. Baylis-Smith AREMU VICTOR TEMITOPE
Management, Governance 20182/203786/S/1456 231383 PricewaterHouseCoopers & Ethics OYELEYE TOFUNMI JONES
Public Sector Accounting Late Balogun J.O. 20182/209139/S/1456 228815 & Finance Omidiora ANYIM CHIZUBE NNEOMA
PROFESSIONAL
Arthur Young, Osindero 20182/302375/P/12345 218797 Corporate Reporting & Moret EHIGIEGBA PROMISE TOSIN
Advanced Audit 20182/306537/P/12345 223293 J.M.T. Morris & KPMG & Assurance ADEOGUN ESTHER ADENIKE
Strategic Financial Late Bola Kuforiji-Olubi 20182/302375/P/12345 218797 Management Elder M.E. Daniels EHIGIEGBA PROMISE TOSIN
Akintola Williams & Co. 20182/304696/P/12345 221902 Advanced Taxation Olushola Adekanola RUFAI IDOWU LAWAL
20182/304330/P/12345 225150 LAWAL OLUWAFEMI MOSES Case Study KPMG 20182/300141/P/12345 224030 AJIBOLA OLUWADAMILARE RIDWAN
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 41 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
(c) SPECIAL PRIZES
► SWAN Prize for the best qualifying female candidate for the diet:
Level Name Examination No. Registration No.
PROFESSIONAL IRETE ANITA IRENOSE 20182/302420/P/12345 217965
► Akintola Williams Delloite and Touche Prize for the best qualifying candidate in a diet:
Level Name Examination No. Registration No.
PROFESSIONAL LAWAL OLUWAFEMI MOSES 20182/304330/P/12345 225150
► Akintola Williams Prize for the best qualifying candidate in a year:
Level Name Examination No. Registration No.
PROFESSIONAL EIGBEFOH MOYOSOREOLUWA ADESUA 20181/306994/P/12345 226020
Prize Winners
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 42 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
3. STUDENTS’ INVESTIGATING LEGAL COMMITTEE The Students’ Investigating Committee considered a total of 1. ACCOUNTANTS’ INVESTIGATING Twenty-Six (26) cases. PANEL The Investigating Panel considered a total of Forty-Four (44) cases. a) PENDING CASES The Students’ Investigating Committee is currently considering Twelve (12) cases. a) PENDING CASES The nature of the cases are briefly classified as follows: The Investigating Panel is currently considering Forty-Three (43) cases of alleged Professional Misconduct. ♦ Alleged unethical conduct/misappropriation The nature of the cases are briefly classified as follows: of funds — 8 ♦ Misappropriation of Funds — 18 ♦ Examination malpractices — 4 ♦ Unethical Practice with regards to Audit Work — 5 Total = 12 ♦ Unethical Conduct as a Staff — 1 ♦ Financial Dispute — 11
♦ Manipulation of Accounts/Records — 1 b) CONCLUDED CASES ♦ Others — 7 The Students’ Investigating Committee concluded Fourteen (14) cases of examination misconduct and malpractices. Total = 43 4. AAT INVESTIGATING COMMITTEE There is no pending matter currently before the AAT b) CASES REFERRED FROM THE Investigating Committee. INVESTIGATING PANEL TO THE DISCIPLINARY TRIBUNAL In the period under review, no matter was referred to the Accountants’ Disciplinary Tribunal.
c) CONCLUDED CASES The Investigating Panel struck out one (1) case for want of FINANCE & GENERAL diligent prosecution. PURPOSES COMMITTEE
2. DISCIPLINARY TRIBUNAL (F&GPC) The Accountants’ Disciplinary Tribunal considered a total of More proactive ways of subscription recovery: Ten (10) cases of alleged professional misconduct. — Easy access to payment portal on ICAN website;
Hosting of financial members list forthnightly on (a) PENDING CASES — There are Ten (10) cases presently pending at various stages ICAN website; and of hearing, which have not been concluded. The cases are classified as follows: — Demand notes for year 2019 subscription were sent to all members through e-mails and SMS. ♦ Unethical Practice with regards to Audit Work — 1 Formulation of Investment Policy for the Institute. ♦ Misappropriation of Funds — 2 ♦ Financial Dispute — 2 Effective and Efficient working Capital Management. ♦ Infamous Conduct — 5 Sum assured on members’ Group Life Assurance Policy was increased from N1.5 million to N2 million = Total 10 for members in Fellowship cadre.
Enhanced Staff Welfare through Staff promotion, (b) CONCLUDED CASES training (local & overseas) and review of salary Nil. package.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 43 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
His Highness, Emir of Kano, Mallam Muhammad Sanusi II receiving his award PUBLICATIONS & IMAGE THE INSTITUTE’S IMAGE The Publications and Image Committee (PIC) of the Institute during the year under review pursued its mandate of maintaining and providing information to the public, members and the users of accounting services to ensure that the Institute’s image continues to improve. In the year, the dissemination of information to both the Institute’s internal and external publics was very robust, effective and timely. All the activities of the Institute were extensively and adequately covered and reported by both the print and electronic media. THE INSTITUTE’S PUBLICATIONS The quarterly journals of the Institute, The Nigerian Accountant for members and the ICAN Students’ Journal Mr. Kunle Elebute, FCA receiving ICAN award on behalf of KPMG were timely produced. The soft copy of each edition of the journals were hoisted on the Institute’s website and also sent visits to further enlighten stakeholders about the Institute. via email to financial members and students. Copies of the publications were also used by the President ANNUAL DINNER AND AWARDS as part of Public Relations items packaged for dignitaries during The Annual Dinner and Awards was held at Eko Hotel & Presidential tours of ICAN District Societies and other official Suites, Victoria Island, Lagos on Saturday, April 13, 2019.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 44 2018 Annual Report & Financial Statements ► REPORTS of Committees of Council TO MEMBERS OF THE INSTITUTE
The Dinner brought together members of the accountancy profession and other invited guests both from private and public sectors of the economy to socialise. Awards were given to some outstanding individuals and corporate bodies for the impact they made on the Institute and the society in general.
The recipients in the different categories are: a) Members Category Alhaji Otunba Abdul Lateef Adebayo Owoyemi, FCA, Past President, ICAN. Dr Awa Ibraheem, FCA.
b) Non-Members Category His Highness, Sarkin Kano, Mallam Muhammad Sanusi II, CON.
c) Corporate Body Category Deloitte & Touche. Dr. Awa Ibraheem, FCA receiving his award KPMG Professional Services.
The Governing Council of the Institute also approved the following distinguished personalities for awards but they were unable to attend: — Chief Dr. (Mrs.) Nike Akande, CON, former Minister of Industry. — Professor Ibrahim Gambari, CFR, former Ambassador to the United Nations. 2019 ELECTION INTO COUNCIL In line with International best practice, the 2019 Election to Council was conducted strictly via the internet (e-voting). Five vacancies were declared in Council – Three (3) of the existing vacancies are for members-in-practice and two (2) are for members- not-in-practice. Nominations were received from members. The following people were nominated for election in the two categories: MEMBERS IN PRACTICE CATEGORY Otunba Abdulateef Owoyemi, FCA (Past President) receiving his award from ICAN President a) Adeleke Solomon Oluwole (Deacon) b) Akinmoladun Bukunola Morayo (Mrs.) c) Anyanechi Chibuzor Noel (Chief) d) Bammeke Sunday Abayomi (Mr.) e) Daudu Michael Folusho (Mr.) f) Disu Samson Adewale (Reverend) g) Okonkwo Ngozi Monica (Lady) h) Oyedepo Fatai Oyebade (Prince) MEMBERS NOT-IN-PRACTICE CATEGORY a) Akibayo Titilola Ariyike Nurat (Alhaja) b) Akinsulire Clement Oyemolu Olugbenga (Chief) c) Anyalenkeya Benedict Uzoma (Mr.) d) Foster-Odhi Anthony Olubunmi (Mr.) e) Lawal Itopa Lamidi (Mr.) f) Oke Olubode (PhD) g) Olanrewaju Oluseyi Oladimeji (Mr.) The results were downloaded and collated by the Scrutineers appointed by Council. The results of the Mr. Fatai Folarin, FCA receiving ICAN award on behalf of Delloitte Election will be announced at this AGM.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 45 2018 Annual Report & Financial Statements ► Audited FINANCIAL STATEMENTS FOR YEAR ENDED 31 DECEMBER 2018
47 Honorary Treasurer’s Report
48 Independent Auditors’ Report 50 Statement of Comprehensive Income
51 Statement of Financial Position
52 Statement of Changes in Members’ Funds
54 Statement of Cash Flows
55 Notes to the Financial Statements
Other National Disclosures:
95 Statement of Value Added
96 Five-year Financial Summary
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 46 2018 Annual Report & Financial Statements ► HONORARY TREASURER’s Report TO MEMBERS OF THE INSTITUTE
I am pleased to welcome distinguished members of the Institute to the 54th Annual General Meeting of the Institute of Chartered Accountants of Nigeria and to present the year 2018 Financial Statements which were considered and recommended by the Council at its meeting of April 24th, 2019 for your consideration and approval. Below are the highlights of the year 2018 Financial Statements:
INCREASE/ INCREASE/ YEAR 2018 YEAR 2017 DECREASE DECREASE N’000 N’000 N’000 % TOTAL ASSETS 3,616,827 3,941,705 (324,878) (8.24%) TOTAL LIABILITIES 305,354 434,839 129,485 29.78% TOTAL FUNDS AND RESERVES 3,311,473 3,506,866 (195,393) (5.57%) ACCUMULATED FUNDS 924,148 1,171,227 (247,079) (21.09%) TOTAL INCOME 2,802,170 2,646,172 155,998 5.89% TOTAL EXPENDITURE 2,978,349 2,461,251 (517,098) (21.01%) TOTAL SURPLUS/(DEFICIT) FOR THE YEAR (225,527) 251,801 (477,328) (189.57%)
COMMENTS ON THE OPERATING RESULTS AND MAJOR BALANCE SHEET ITEMS
For effective and efficient management information necessary for 21st Century decision making, the Institute’s financial statement for year 2018 was prepared using the Microsoft Dynamics Navision system. In the year under review, the Council of the Institute reviewed the sum assured on the Members’ Group Personal Assurance Policy for Fellows from N1.5 million (One million five hundred thousand naira only) to N2 million (two million naira only) payable to the next of kin of the deceased who was in a good financial standing with the Institute. The Council also ensures that families of our deceased members are promptly settled. In the same vein, the Institute initiated and commenced implementation of the Accountability Index to improve accountability in the public sector in accordance with the International Federation of Accountants’ regulations. The Institute complied with the two new IFRSs that became operational from January 1, 2018; i.e. IFRS 9 which deals with impairment using expected credit loss (ECL) model and IFRS 15 that bothers on impact assessment of revenue from contracts with customers. To ensure comparability of information, the year 2017 figures were restated in the accounts where necessary. The deficit of N225.527 million recorded during the year could be attributed to the following expenditure heads with higher outflows compared to year 2017 figures: Professional Charges (27 million) litigation fees to lawyers; Education and Training (N51 million) for overseas training for top management staff; Research & Development Expenses (N45 million) due to initiation of the Accountability Index by the Institute in year 2018; Increase in premium for members’ Life Assurance Policy by N18 million and Bronze sponsorship and cost of sponsoring ICAN delegates to the 2018 World Congress of Accountants (N96 million) an event that occurs every four years. Inflows arising from members’ fees and subscriptions from both students and members rose by 2.87% to N1.292 billion, N36 million higher than year 2017 which is a reflection of continued steady growth in members and students registration. Thenet contribution from Self Financing activities was N1.371 billion as against N1.202 billion in year 2017. This reflects a growth of 24.48% in Professional examination income and increase in contribution by N182 million (2018: N724.00 million; 2017: N542.00 million). Over 70% of the other self financing activities increased both in number of participants and contributions to the overall result for the year. Total Assets as at 31st December, 2018 were N3.617 billion; a decrease of N324.88 million on year 2017 position (2017: N3.942 billion). This reflects depreciation expenditure on information technology infrastructure and assets deployed for Microsoft Navision ERP and motor vehicles purchased in year 2018. As founding members of IFAC, PAFA, CAW and ABWA, the Institute plays prominent roles in these International Bodies and adequately met its financial obligations to these bodies during the year under review. The total amount incurred was N171 million (N174 million in Year 2017). Finally, we give glory to God Almighty for the success recorded in the year while appreciating members for their support and the opportunity given me to be of service to our esteemed Institute as the Honorary Treasurer.
Chief Oyemolu Olugbenga Akinsulire, MSc, MBA, FCTI, FCA Honorary Treasurer
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 47 2018 Annual Report & Financial Statements ► INDEPENDENT AUDITORS’ Report
TO THE MEMBERS OF THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS Our opinion In our opinion, the Institute of Chartered Accountants of Nigeria’s (“the institute’s”) financial statements give a true and fair view of the financial position of the Institute as at 31 December 2018, and of its financial performance and its cash flows for the year then ended in accordance with the International Financial Reporting Standards and the requirements of the Institute of Chartered Accountants of Nigeria Act.
What we have audited The Institute of Chartered Accountants of Nigeria’s financial statements comprise: The statement of financial position as at 31 December 2018; The statement of total comprehensive income for the year then ended; The statement of changes in members’ funds for the year ended; The statement of cash flows for the year then ended; and The notes to the financial statements, which include a summary of significant accounting policies.
Basis for opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence We are independent of the Institute in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code). We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.
Other information The Council is responsible for the other information. The other information comprises the Notice of Meeting, details of Officers and Council, details of Past Presidents, President’s Statement, Report of Committees of Council, Honorary Treasurer’s Report, Statement of Value Added and Five-Year Financial Summary (but does not include the financial statements and our auditor’s report thereon). Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Council and those charged with governance for the financial statements The Council is responsible for the preparation of the financial statements that give a true and fair view in accordance with the International Financial Reporting Standards and the Institute of Chartered Accountants of Nigeria Act, and for such internal control as the Council determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Council is responsible for assessing the Institute’s ability to continue asagoing
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 48 2018 Annual Report & Financial Statements ► INDEPENDENT AUDITORS’ Report
TO THE MEMBERS OF THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless there is a legislation that either intends to repeal the enabling Act of the Institute or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Institute’s financial reporting process.
Auditor’s responsibilities for the audit of the statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Institute’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Council. Conclude on the appropriateness of the Council’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Institute’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Institute to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
For: PricewaterhouseCoopers For: UHY Maaji Chartered Accountants Chartered Accountants Lagos, Nigeria. Lagos, Nigeria. 10 May 2019 10 May 2019
Engagement Partner: Edafe Erhie, FCA Engagement Partner: Gabriel Idahosa, FCA FRC/2013/ICAN/00000001143 FRC/2014/ICAN/00000009524
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 49 2018 Annual Report & Financial Statements ► Statement of COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2018
Restated 31 December 31 December Notes 2018 2017 N’000 N’000 INCOME Fees and subscriptions 4 1,292,365 1,256,633 Operating activities 5(a) 3,545,126 2,969,350
4,837,491 4,225,983
Operational expenditure 5(b) (2,173,356) (1,766,778)
Surplus of income over expenditure 2,664,135 2,459,205
Investment income 6(a) 49,772 57,825 Interest income 6(c) 42,210 83,795 Other income 6(b) 46,053 45,347
Total income 2,802,170 2,646,172
Non-operational expenditure International affiliation costs 7 171,475 173,899 Depreciation and amortisation 8 231,823 208,022 General and administrative expenses 9 1,001,153 935,183 Personnel cost 10 972,619 889,603 Other operational expenditure 11(a) 518,025 254,544 Impairment charges 11(b) 83,254 –
2,978,349 2,461,251
(Deficit)/surplus for the year (176,179) 184,921
OTHER COMPREHENSIVE INCOME: Items that will be reclassified to profit or loss in subsequent year: Gain in fair value of available-for-sale investments 16 – 66,880
Items that will not be reclassified to profit or loss: Loss in financial assets fair valued through other comprehensive income 16 (49,348) –
Total comprehensive (loss)/income for the year (225,527) 251,801
The Notes on pages 55 to 94 are an integral part of these financial statements.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 50 2018 Annual Report & Financial Statements ► Statement of FINANCIAL POSITION AS AT YEAR ENDED 31 DECEMBER 2018
Restated Restated 31 December 31 December 1 January Notes 2018 2017 2017 ASSETS N’000 N’000 N’000 Non-current assets Property, plant and equipment 13 1,032,621 937,778 985,943 Intangible assets 14 12,374 24,744 37,114 Investment property 15 1,638,000 1,638,000 1,638,000 Financial assets FVOCI 16 59,274 – – Available-for-sales investment 16 – 138,757 71,877 Financial assets at amortised cost 17(b) 18,575 – – Loans and receivables 17(b) – 16,793 21,957
Total non-current assets 2,760,844 2,756,072 2,754,891
Current assets Members’ subscription receivable 30 75,102 84,392 427,177 Financial assets at amortised cost 17(b) 23,375 – – Loans and receivables 17(b) – 20,236 24,744 Inventories 18 119,990 228,064 81,095 Other receivables 19 26,660 27,593 94,073 Prepayment 20 111,698 84,473 35,093 Deferred expenses 21 4,371 5,178 5,240 Cash and cash equivalents 22 494,787 735,697 790,420
Total current assets 855,983 1,185,633 1,457,842
Total assets 3,616,827 3,941,705 4,212,733
FUNDS AND RESERVE Accumulated fund 26(a) 924,148 1,171,227 1,810,056 Other charitable and trust funds 26(b) 2,380,587 2,279,552 2,118,961 Available-for-sales reserve – 56,087 (10,793) FVOCI reserve 6,738 – –
Total funds and reserve 3,311,473 3,506,866 3,918,224
Non-current liabilities Contract liabilities 25 19,034 11,416 5,687
Total non-current liabilities 19,034 11,416 5,687
Current liabilities Accounts payable 24 286,320 423,423 288,822
Total current liabilities 286,320 423,423 288,822
Total liabilities 305,354 434,839 294,509
Total reserves and liabilities 3,616,827 3,941,705 4,212,733
The notes on pages 55 to 94 are an integral part of these financial statements. The financial statements were approved and authorised for issue by Council on ……….….…………..April 24, 2019 and signed on its behalf by:
…………………………………………………… ……………………………………………………… Razak Jaiyeola (President) Oyemolu O. Akinsulire (Honorary Treasurer) FRC/2013/ICAN/00000004272 FRC/2017/ICAN/00000017086
……………………...... ………………………… John I. Evbodaghe (Registrar/Chief Executive) FRC/2014/ICAN/00000005915
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 51 2018 Annual Report & Financial Statements ► Statement of CHANGES IN MEMBERS’ FUNDS FOR THE YEAR ENDED 31 DECEMBER 2018
<------Other Charitable and Trust Funds ------>
FVOCI Available-for-Sales Accumulated Development Prizes Benevolent Library Accountancy Study Text Student Total Reserves Reserves Fund Fund Fund Fund Fund Research Revolving Development & Fund Fund Support Fund N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000
Balance at 1 January 2017 – (10,793) 1,382,879 1,563,316 14,771 150,645 50,145 145,469 166,814 27,801 3,491,047
Impact of new standards * – – 427,177 – – – – – – – 427,177
Balance at 1 January 2017 – Restated – (10,793) 1,810,056 1,563,316 14,771 150,645 50,145 145,469 166,814 27,801 3,918,224
Surplus for the year – – 184,921 – – – – – – – 184,921
Utilisation from fund – – 90,408 – (1,349) – (15,006) – (21,359) (52,694) –
(Transfer from)/receipt into fund – – (250,999) – – 20,736 – – 172,046 58,217 –
Movement in funds Available-for-sales investment – 66,880 – – – – – – – – 66,880
Total comprehensive income – 66,880 24,330 – (1,349) 20,736 (15,006) – 150,687 5,523 251,801
Balance at 31 December 2017 – 56,087 1,407,209 1,563,316 13,422 171,381 35,139 145,469 317,501 33,324 3,742,848
Reclassification due to new standard 56,087 (56,087) – – – – – – – – –
Impact of new standards * – – (235,982) – – – – – – – (235,982)
Balance at 31 December 2017 – Restated 56,087 – 1,171,227 – – – – – – – 1,227,314
Deficit for the year – – (176,179) – – – – – – – (176,179)
Utilisation from fund – – 229,140 – (2,872) (15,449) – (128,220) (82,599) –
Transfer of profit from investment disposed – – - – – 30,135 – – – – 30,135
(Transfer from)/receipt into fund – – (300,040) – – 23,502 – – 205,024 71,514 –
Movement in funds Equity investment (49,349) – – – – – – – – – (49,349)
Total comprehensive income 6,738 – (247,079) – (2,872) 53,637 (15,449) – 76,804 (11,085) (195,393)
Balance at 31 December 2018 6,738 – 924,148 1,563,316 10,550 225,018 19,690 145,469 394,305 22,239 3,547,455
The analysis of reserves is presented in Note 26
* Explanation of impact of new standards is in Note 2.3.1
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 52 2018 Annual Report & Financial Statements ► Statement of CHANGES IN MEMBERS’ FUNDS FOR THE YEAR ENDED 31 DECEMBER 2018
<------Other Charitable and Trust Funds ------>
FVOCI Available-for-Sales Accumulated Development Prizes Benevolent Library Accountancy Study Text Student Total Reserves Reserves Fund Fund Fund Fund Fund Research Revolving Development & Fund Fund Support Fund N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000
Balance at 1 January 2017 – (10,793) 1,382,879 1,563,316 14,771 150,645 50,145 145,469 166,814 27,801 3,491,047
Impact of new standards * – – 427,177 – – – – – – – 427,177
Balance at 1 January 2017 – Restated – (10,793) 1,810,056 1,563,316 14,771 150,645 50,145 145,469 166,814 27,801 3,918,224
Surplus for the year – – 184,921 – – – – – – – 184,921
Utilisation from fund – – 90,408 – (1,349) – (15,006) – (21,359) (52,694) –
(Transfer from)/receipt into fund – – (250,999) – – 20,736 – – 172,046 58,217 –
Movement in funds Available-for-sales investment – 66,880 – – – – – – – – 66,880
Total comprehensive income – 66,880 24,330 – (1,349) 20,736 (15,006) – 150,687 5,523 251,801
Balance at 31 December 2017 – 56,087 1,407,209 1,563,316 13,422 171,381 35,139 145,469 317,501 33,324 3,742,848
Reclassification due to new standard 56,087 (56,087) – – – – – – – – –
Impact of new standards * – – (235,982) – – – – – – – (235,982)
Balance at 31 December 2017 – Restated 56,087 – 1,171,227 – – – – – – – 1,227,314
Deficit for the year – – (176,179) – – – – – – – (176,179)
Utilisation from fund – – 229,140 – (2,872) (15,449) – (128,220) (82,599) –
Transfer of profit from investment disposed – – - – – 30,135 – – – – 30,135
(Transfer from)/receipt into fund – – (300,040) – – 23,502 – – 205,024 71,514 –
Movement in funds Equity investment (49,349) – – – – – – – – – (49,349)
Total comprehensive income 6,738 – (247,079) – (2,872) 53,637 (15,449) – 76,804 (11,085) (195,393)
Balance at 31 December 2018 6,738 – 924,148 1,563,316 10,550 225,018 19,690 145,469 394,305 22,239 3,547,455
The analysis of reserves is presented in Note 26
* Explanation of impact of new standards is in Note 2.3.1
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 53 2018 Annual Report & Financial Statements ► Statement of CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2018
Restated 31 December 31 December Notes 2018 2017 N’000 N’000
CASH FLOWS FROM OPERATING ACTIVITIES
Cash used in operating and fund activities 29(a) (107,420) (154,877) Cash generated from funding activities 29(b) 101,035 160,591
Net cash (used in)/generated from operating activities (6,385) 5,714
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment 13 (314,297) (147,488) Proceed from disposal of property, plant and equipment 6(b) 8,427 1,155 Disposal of equity investments 16 30,135 – Interest received 6(c) 42,210 83,795
Net cash used in investing activities (233,525) (62,538)
Cash flows from financing activities – –
Net cash generated from financing activities – –
Net decrease in cash and cash equivalents (239,910) (56,824) Foreign exchange (loss)/gains on cash and cash equivalents (1,000) 2,101 Cash and cash equivalents at the beginning of the year 735,697 790,420
Cash and cash equivalents at the end of the year 494,787 735,697
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 54 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
1. GENERAL INFORMATION
The Institute of Chartered Accountants of Nigeria (ICAN) is a body established by Act of Parliament No.15 of 1965 to:
i) Determine what standards of knowledge and skill are to be attained by persons seeking to become member of the accountancy profession and to raise those standards from time to time as circumstances may permit;
ii) Secure, in accordance with the provisions of the Act, the establishment and maintenance of the registers of Fellows, Associates and Registered Accountants entitled to practice as Accountants and Auditors and to publish from time to time a list of those persons;
iii) Perform, through the Council of the Institute, all other functions conferred on it by the Act.
The Institute is an accountancy body in Nigeria recognised by the International Federation of Accountants (IFAC) as the foremost professional accountancy body in the West African sub-region. The Institute, in 1982, initiated and contributed significantly to the formation of theAssociation of Accountancy Bodies in West Africa (ABWA). The Institute is also a pioneer member of Pan-African Federation of Accountants (PAFA) and indeed produced its pioneer president.
HEAD OFFICE Plot 16, Idowu Taylor Street, Victoria Island, Lagos, Nigeria. P.O. Box 1580, Lagos. E-mail: [email protected] Website: www.icanig.org
VISION To be a leading global professional body.
MISSION STATEMENT To produce world-class Chartered Accountants, regulate and continually enhance their ethical standards and technical competence in the public interest.
MOTTO Accuracy and Integrity
FINANCIAL REPORTING REGISTRATION NO: FRC/2013/0000000017
JOINT AUDITORS: PricewaterhouseCoopers (PwC) Chartered Accountants Landmark Towers 5B Water Corporation Road, Victoria Island, Lagos.
UHY Maaji & Co Chartered Accountants 22 Town Planning Way, Ilupeju, Lagos.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 55 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1 Introduction to summary of significant accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
2.2 Basis of preparation
The financial statements of the Institute of Chartered Accountants of Nigeria have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Additional information required by National regulations is included where appropriate.
The financial statements comprise the statement of comprehensive income, the statement of financial position, the statement of changes in members’ funds, the statement of cash flows and the notes to the financial statements.
The financial statements have been prepared in accordance with the going concern principle under the historical cost concept. All values are rounded to the nearest thousand, except when otherwise indicated. The financial statements are presented in Naira.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Institute’s accounting policies. Changes in assumptions may have a significant impact on the financial statements in the period the assumptions changed. Management believes that the underlying assumptions are appropriate and that the Institute’s financial statements, therefore, present the financial position and results fairly. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 2.5.
2.2.1 Going concern
The Institute has consistently been generating funds through its members’ subscriptions and students’ exams fee. The Management believes that there is no intention or threat from any source to curtail significantly its membership and students enrollment in the foreseeable future. Thus, these financial statements are prepared on going concern basis.
2.2.2 Changes in accounting policies and disclosures
New standards, amendments and interpretations adopted by the Institute. The Institute has applied the following standards for the first time for their annual reporting period commencing 1 January 2018: — IFRS 9 Financial Instruments. — IFRS 15 Revenue from Contracts with Customers.
The Institute had to change its accounting policies and make certain retrospective adjustments following the adoption of IFRS 9 and IFRS 15. This is disclosed in Note 2.3.
2.2.3 IFRS 9 Financial Instruments (policy applicable from 1 January 2018)
The Institute’s accounting policies were changed to comply with IFRS 9. IFRS 9 replaces the provisions of IAS 39 that relate to the recognition, classification and measurement of financial assets and financial liabilities; derecognition of financial instruments; impairment of financial assets and hedge accounting. IFRS 9 also significantly amends other standards dealing with financial instruments such as IFRS 7 Financial Instruments: Disclosures.
(a) CLASSIFICATION AND MEASUREMENT Financial assets It is the Institute’s policy to initially recognise investments and other financial assets at fair value plus transaction costs.
Classificationand subsequent measurement is dependent on the Institute’s business model for managing the asset and the cash flow characteristics of the asset. On this basis, the Institute may classify its financial instruments at amortised cost, fair value through profit or loss and at fair value through other comprehensive income (FVTOCI).
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 56 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
(a) CLASSIFICATION AND MEASUREMENT Financial assets (cont’d)
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in equity instruments that are not held for trading, this will depend on whether the Institute has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income (FVOCI).
The Institute’s equity investments are classified at FVTOCI. Other financial assets satisfy the conditions for classification at amortised cost under IFRS 9.
The Institute’s financial assets at amortised cost at the reporting date include staff loans, loans and receivables and receivables from district societies. Other financial assets at amortised cost include cash and cash equivalents, membership subscription receivables, and other receivables. They are included in current assets, except for maturities greater than 12 months after the reporting date.
Interest income from these assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in finance income/cost.
Equity investments The Institute’s policy is to subsequently measure all quoted investments at FVTOCI. Fair value gains and losses are recognised in OCI and are not subsequently reclassified to profit or loss, including on disposal. Dividends fromsuch investments continue to be recognised in profit or loss as other income when the Institute’s right to receive payments is established.
Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.
Financial liabilities Financial liabilities of the Institute are classified and measured at fair value on initial recognition and subsequently at amortised cost net of directly attributable transaction costs . Fair value gains or losses for financial liabilities designated at fair value through profit or loss are accounted for in profit or loss except for the amount of change that is attributable to changes in the Institute’s own credit risk which is presented in other comprehensive income. The remaining amount of change in the fair value of the liability is presented in profit or loss. The Institute’s financial liabilities include accrued expenses and other account payables. The Institute does not have any financial liabilities at fair value through profit or loss.
(b) IMPAIRMENT OF FINANCIAL ASSETS
Recognition of impairment provisions under IFRS 9 is based on the expected credit loss (ECL) model. The ECL model is applicable to financial assets classified at amortised cost and contract assets under IFRS 15: Revenue from Contracts with Customers. The measurement of ECL reflects an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes, time value of money and reasonable and supportable information that is available without undue cost or effort at the reporting date, about past events, current conditions and forecasts of future economic conditions.
The simplified approach is applied to membership subscription receivables while the general approach is applied to all other financial assets at amortised cost.
The simplified approach requires expected lifetime losses to be recognised from initial recognition of the receivables. This involves determining the expected loss rates using a provision matrix that is based on the Institute’s historical default rates observed over the expected life of the receivable and adjusted for forward-looking estimates. This is then applied to the gross carrying amount of the receivable to arrive at the loss allowance for the period.
The three-stage approach assesses impairment based on changes in credit risk since initial recognition using the past due criterion and other qualitative indicators such as increase in political concerns or other macroeconomic factors and the risk of legal action, sanction or other regulatory penalties that may impair future financial performance. Financial assets classified as stage 1 have their ECL measured as a proportion of their lifetime ECL that results from possible default events that can occur within one year, while assets in stage 2 or 3 have their ECL measured on a lifetime basis.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 57 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
(b) IMPAIRMENT OF FINANCIAL ASSETS (cont’d)
Under the three-stage approach, the ECL is determined by projecting the probability of default (PD), loss given default (LGD) and exposure at default (EAD) for each ageing bucket and for each individual exposure. The PD is based on default rates determined by external rating agencies for the counterparties. The LGD is determined based on management’s estimates by adopting the average recovery rates for corporate senior unsecured loans in emerging economies. The EAD is the total amount of outstanding receivable at the reporting period. These three components are multiplied together and adjusted for forward looking information, such as inflation and interest rate, to arrive at an ECL which is then discounted back to the reporting date and summed. The discount rate used in the ECL calculation is the original effective interest rate or an approximation thereof.
Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the related financial assets and the amount of the loss is recognised in profit or loss.
(c) SIGNIFICANT INCREASE IN CREDIT RISK AND DEFAULT DEFINITION
Significant increase in credit risk The Institute assesses the credit risk of its financial assets based on the information obtained during periodic review of publicly available information, industry trends and payment records. Based on the analysis of the information provided, the Institute identifies the assets that require close monitoring. The Institute has considered various quantitative and qualitative criteria in determining significant increase in credit risk.
i) Quantitative criteria The Institute has considers the external credit rating for other receivables in determining significant increase in credit risk (SICR). The Institute monitors changes in external ratings of counterparties to assess significant increase in credit risk (SICR). Evidence of SICR depends on rating at initial recognition and the extent of movement in number of notches downgrade (number of downward movements between rating grades) as at reporting date.
The Institute considers a four-notch downgrade and two-notch downgrade in investment grades and speculative grades categories respectively. For investment grade facilities, a deterioration to speculative grade is also deemed significant.
The table below shows the notch downgrades for each credit rating:
External Credit Grade Number of Notch External Credit Grade Number of Notch Rating (S&P) Downgrades Rating (S&P) Downgrades
AAA Investment 4 BB+ Speculative 2 grade grade AA+ BB AA BB- AA- B+ A+ B A B- A- CCC+ BBB+ CCC BBB CCC- BBB- C D
ii) Qualitative criteria The Institute considers the following as qualitative indicators of significant increase in credit risk:
1. Actual or expected forbearance or restructuring.
2. Significantdeterioration in liquidity/solvency levels of the debtor at the reporting date which could result in a significant change in the party’s ability to meet its obligations relative to the origination date (date the receivable was recognised).
3. Significant increase in credit spread.
4. Significant adverse changes in business, financial and/or economic conditions in which the counterparty operates.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 58 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
(c) SIGNIFICANT INCREASE IN CREDIT RISK AND DEFAULT DEFINITION (cont’d)
iii) Back stop indicator Financial assets that have been identified to be more than 30 days past due (Watchlist) on contractual payments are assessed to have experienced significant increase in credit risk. These assets are grouped as part of Stage 2 financial assets where the three-stage approach is applied.
Definition of default In line with the Institute’s credit risk management practices, a financial asset is defined to be in default when contractual payments have not been received at least 90 days after the contractual payment period. Subsequent to default, the Institute carries out active recovery strategies to recover all outstanding payments due on receivables. Where the Institute determines that there are no realistic prospects of recovery, the financial asset and any related loss allowance is written off either partially or in full.
The Institute considers a financial asset to be in default which is fully aligned with the credit-impaired, when it meets one or more of the following criteria:
i) Quantitative criteria The party is more than 90 days past due on its contractual payments.
ii) Qualitative criteria The member/party meets unlikeliness to pay criteria, which indicates the member/party is in significant financial difficulty. These are instances where: ● The party is in long-term forbearance. ● The party is deceased. ● The party is insolvent. ● The party is in breach of financial covenant(s). ● An active market for that financial asset has disappeared because of financial difficulties. ● Concessions have been made by the lender relating to the party’s financial difficulty.
(d) DERECOGNITION
Financial assets The Institute derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire or when it transfers the financial asset and the transfer qualifies for derecognition. Gains or losses on derecognition of financial assets are recognised as finance income/ cost.
Financial liabilities Financial liabilities are derecognised when they are extinguished (i.e. when the obligation specified in the contract is discharged, cancelled or expires). When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised immediately in the statement of comprehensive income.
(e) WRITE-OFF POLICY
The Institute writes off financial assets, in whole or in part, when it has exhausted all practical recovery efforts and has concluded that there is no reasonable expectation of recovery. Indicator that there is no reasonable expectation of recovery includes ceasing enforcement activities.
(f) OFFSETTING OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES
Financial assets and liabilities are offset and the net amount is reported in the statement of financial position. Offsetting can be applied when there is a legally enforceable right to offset the recognised amounts, and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.
The legally enforceable right is not contingent on future events and is enforceable in the normal course of business, and in the event of default, insolvency or bankruptcy of the Institute or the counterparty.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 59 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
2.2.4 Financial Instruments (Policy before 1 January 2018)
FINANCIAL ASSETS Financial assets are classified into the following specified categories: Financial assets at ‘fair value through profitor loss’ (FVTPL), ‘held-to-maturity’ investments, ‘available-for-sale’ (AFS) financial assets and ‘loan and receivables’. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognised or derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the market place.
(i) Effective interest method The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees paid or received that form an integral part of the effective rate and transaction) through the expected life of the debt instrument, or where appropriate, a shorter period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest rate basis for debt instruments other than those financial assets classified as fair value through profit or loss (FVTPL).
(ii) Financial assets at fair value through profit or loss (FVTPL) Financial assets are classified as fair value through profit or loss’ (FVTPL) when the financial asset is either held for trading or it is designated as (FVTPL).
A financial asset is classified as held for trading if: ► It has been acquired principally for the purpose of selling it in the near term; or ► On initial recognition it is part of a portfolio of identified financial instruments that the Institute manages together and has a recent actual pattern of short-term profit-taking; or ► It is a derivative that is not designated and effective as a hedging instrument.
A financial asset other than a financial asset held for trading may be designated as fair value through profit or loss’ (FVTPL) initial recognition if: ► Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or ► The financial asset form part of the Institute’s financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Institute’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or ► It forms part of a contract containing one or more embedded derivatives, and IAS 39 Financial instruments: Recognition and Measurement permit the entire combined contract (asset or liability) to be designated as fair value through profit or loss (FVTPL).
Financial assets at fair value through profit or loss (FVTPL) are stated at fair value, with any gains or losses arising on remeasurement recognised in the statement of comprehensive income. The net gain or loss recognised in the statement of comprehensive income incorporates any dividend or interest earned on the financial asset and is included in the ‘other gains and losses’ line item in the Institute’s (statement of comprehensive income/income statement).
(iii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quotedin an active market. Loans and receivables include ‘staff loans’ and other ‘advance to district societies’ in the statement of financial position which are measured at amortised cost using the effective interest method, less any impairment and other employee benefit embedded in the loans.
Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
(iv) Subscription and other receivables Subscription and other receivables are stated at amortised cost based on the original invoice amount less an allowance for any irrecoverable amounts. Full provision is made for subscriptions receivable. Provision for other receivables is made when there is objective evidence that the Institute will not be able to collect certain debts. Bad debts are written off when identified. Terms on receivables balances range from 30 to 90 days.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 60 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
Financial Instruments (Policy before 1 January 2018) (cont’d)
(v) Cash and cash equivalents Cash and cash equivalents comprise cash on hand, demand and short-term deposits with banks and similar institutions, which are readily convertible to known amounts of cash and are subject to insignificant risk of changes in their fair value and used by the Institute in the management of its short-term commitments. Short-term is defined as being three months or less. This definition is also used for the cash flow statement.
(vi) Available-for-sale financial assets (AFS financial assets) AFS financial assets are non-derivatives that are either designated as AFS or are not classified as (a) Loans and receivables; (b) Held-to-maturity investments; or (c) Financial assets at fair value through profit or loss.
Listed redeemable notes held by the Insitute that are traded in an active market are classified as AFS and are stated at fair value at the end of each reporting period. Changes in the carrying amount of AFS monetary financial assets relating to changes in interest income calculated using the effective interest method and dividends on AFS equity investment are recognised in the statement of comprehensive income.
Other changes in the carrying amounts of available-for-sale financial assets are recognised in other comprehensive income and accumulated under the heading of investment revaluation reserve. When the investment is disposed off or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation is reclassified to statement of comprehensive income.
Dividends on AFS equity instruments are recognised in the statement of comprehensive income when the Institute’s right to receive the dividend is established.
The fair value of AFS monetary financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate prevailing at the end of the reporting period. The foreign currency gains and losses that are recognised in the statement of comprehensive income are determined based on the amortised cost of the monetary asset. Other foreign exchange gains and losses in other comprehensive income.
(vii) Derecognition of financial assets The Institute derecognises a financial asset when the contractual rights to the cashflows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Institute neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Institute recognises its retained interest in the asset and an associated liabilty for amounts it may have to pay.
If the Institute retains substantially all the risk and rewards of ownership of a transferred financial asset, the Institute continues to recognise the financial asset and also recognise a collaterised borrowing for the proceeds received.
On derecognition of a financial asset in its entirety, the difference between the assets’s carrying amount and the sum of the consideration received and recievable and the cummulative gains or loss that had been recognised in other comprehensive income and accumulated in the equity is recognised in the statement of comprehensive income.
On derecognition of a financial asset other than in its entirety (e.g. when the Institute retains an option to repurchase part of a transferred asset), the Institute allocates the previous carrying amount of the financial asset between the part it continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair value of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that had been recognised in other comprehensive income is recognised in the statement of comprehensive income. A cumulative gain or loss that had been recognised in other comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair value of those parts.
(viii) Derecognition of financial liabilities The Institute derecognises financial liabilities when, and only when, the Institute’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in statement of comprehensive income.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 61 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Financial Instruments (Policy before 1 January 2018) (cont’d)
(ix) Trade payables Trade payables classified as financial liabilities are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Other payables that are within the scope of IAS 39 are subsequently measured at amortised cost. Others are measured in respect to their applicable standards.
2.2.5 Revenue recognition from contracts with customers
The Institute has adopted IFRS 15 as issued in May 2014 which has resulted in changes in accounting policy of the Institute. IFRS 15 replaces IAS 18 which covers revenue arising from the sale of goods and the rendering of services, IAS 11 which covers construction contracts, and related interpretations. In accordance with the transitional provisions in IFRS 15, comparative figures have been restated as the Institute has applied the full retrospective approach in adopting this standard.
Revenue is measured at the fair value of the consideration received or receivable for services, in the ordinary course of the Institute’s activities. “The Institute recognises fees and subscriptions to depict the transfer of promised services to members and students in an amount that reflects the consideration to which it expects to be entitled in exchange for those services”
Revenue recognition from contracts with customers A valid contract is recognised as revenue after: ● The contract is approved by the parties. ● Rights and obligations are recognised. ● Collectability is probable. ● The contract has commercial substance. ● The payment terms and consideration are identifiable.
The probability that a customer would make payment (collectability criteria) is ascertained based on the evaluation done on the members as stated in the credit management policy at the inception. The Institute has included a 3-year working experience as a criteria for all students who want to become members to ensure collectability, non financial members are also delisted after 3 years.
The Institute is the principal in all of its revenue arrangement and recognises revenue from the following activities: ● Fees and subscription. ● Qualification and fellowship. ● Regulation, education and discipline. ● Conferences and courses. ● Seal and stamps.
Revenue for providing these services are recognised in the accounting period in which the services are provided. Each of the services are a separate performance obligation. Fees and subscription are recognised over time as the service is provided while all other revenue are recognised at a point in time.
2.3 Change in accounting policies
This note explains the impact of the adoption of IFRS 9: Financial Instruments and IFRS 15: Revenue from Contracts with Customers (including the amendments to IFRS 15) on the financial statements.
2.3.1 Impact on the financial statements
As a result of the changes in the Institute’s accounting policies, prior year financial statements had to be restated. As explained below, IFRS 9 was generally adopted without restating comparative information. The reclassifications and the adjustments arising from the new impairment rules are therefore not reflected in the restated balance sheet as at31 December 2017, but are recognised in the opening balance sheet on 1 January 2018.
The following tables show the adjustments recognised for each individual line item. Line items that were not affected by the changes have not been included. As a result, the sub-totals and totals disclosed cannot be recalculated from the numbers provided. The adjustments are explained in more detail below:
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 62 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
2017 31 December 1 January (As Originally 2017 2018 Presented) IFRS 9 IFRS 15 Restated IFRS 9 Restated SOFP (extract) N’000 N’000 N’000 N’000 N’000 N’000
NON-CURRENT ASSETS
Financial assets at fair value through OCI (FVOCI) – – – – – – Loans and receivables/Financial assets at amortised cost 16,793 – – 16,793 – 16,793 Available-for-sale financial assets – – – – (138,757) (138,757) Members subscription receivable (Net) – – 666,815 666,815 (582,422) 84,393
CURRENT ASSETS
Loans and receivables/Financial assets at amortised cost 20,236 – – 20,236 – 20,236 Other receivables 108,330 – – 108,330 (80,737) 27,593 Cash and bank equivalents 735,697 – – 735,697 – 735,697
Total assets 881,056 – 666,815 1,547,871 (801,916) 745,955
Accumulated fund 1,167,571 – 666,815 1,834,386 (801,916) 1,032,470 Available for sale investments reserves – – – – (56,087) (56,087) FVOCI reserve – – – – 56,087 56,087
December 2016 1 January (As Originally 2017 Presented) IFRS 9 IFRS 15 Restated SOFP (extract) N’000 N’000 N’000 N’000
NON-CURRENT ASSETS
Loans and receivables/Financial assets at amortised cost 21,957 – – 21,957 Available-for-sale financial assets – – – – Members subscription receivable (Net) – – 427,177 427,177
CURRENT ASSETS
Loans and receivables/Financial assets at amortised cost 24,744 – – 24,744 Other receivables 94,073 – – 94,073 Cash and bank equivalents 790,420 – – 790,420
Total assets 931,194 – 427,177 1,358,371
Accumulated fund 1,382,879 – 427,177 1,810,056
STATEMENT OF COMPREHENSIVE INCOME (EXTRACT) 2017
Revenue from contracts with customers: Fees and subscription 1,016,995 – 239,638 1,256,633
(Deficit)/surplus for the year (54,717) – 239,638 184,921
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 63 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
IFRS 9 Financial instruments The Institute has adopted IFRS 9 as issued by the IASB in July 2014 with a date of transition of 1 January 2018, which resulted in changes in accounting policies and adjustments to the amounts previously recognised in the financial statements. IFRS 9 replaces the provisions of IAS 39 that relate to the recognition, classification and measurement of financial assets and financial liabilities, derecognition of financial instruments, impairment of financial assets and hedge accounting.
As permitted by the transitional provisions of IFRS 9, The Institute has elected to adopt the modified retrospective approach on transition to IFRS 9, “Financial instruments” and will not restate comparative information. The adjustments arising from the new impairment rules are therefore not reflected in the statement of financial position as at 31 December 2017, but are recognised in the opening statement of changes in members’ funds on 1 January 2018.
IFRS 9 also significantly amends other standards dealing with financial instruments such as IFRS 7 ‘Financial Instruments: Disclosures’. Consequently, for note disclosures, the consequential amendment to IFRS 7 disclosures have been applied to the current period. The comparative note disclosures repeat those disclosures made in prior year.
Set out in tables below are disclosures relating to the impact of adoption of IFRS 9 on the Institute. Line items that were not affected by the changes have not been included. As a result, the sub-totals and totals disclosed cannot be recalculated from the number provided.
(i) Classification and measurement of financial instruments
The measurement category and the carrying amount of financial assets and liabilities in accordance with IAS 39 and IFRS 9 at 1 January 2018 are compared as follows:
Classification & Measurement Category Gross Carrying Amount
Original New Original New Note IAS 39 IFRS 9 IAS 39 IFRS 9 N’000 N’000 N’000 N’000 FINANCIAL ASSETS
Available-for-sale financial assets 16 Available FVTOCI 138,757 138,757 for sale Loans and receivables 17 37,029 37,029 Other receivables 19 27,593 27,593 Cash and cash equivalents 22 Amortised Amortised 735,697 735,697 cost cost
The closing balances as at 31 December 2017 show available-for-sale financial assets under FVOCI. These reclassifications have no impact on the measurement categories. The gross carrying amounts disclosed above are before considering impairment on the receivables and IFRS 15 impact. There were no changes to the classification and measurement of financial liabilities.
Available-for-sale Investments FVOCI Reserves Reserves N’000 N’000 IMPACT OF RECLASSIFICATION ON EQUITY INVESTMENT
Closing balance 31 December 2017 – IAS 39 56,087 – Reclassification of equity instruments (56,087) 56,087
Opening balance 1 January 2018 – IFRS 9 – 56,087
Equity investments previously classified as available-for-sale
The Institute elected to present in OCI changes in the fair value of all its equity investments previously classified as available-for-sale, because these investments are held as long-term strategic investments that are not expected to be sold in the short to medium term. The Institute only sells to meet its liquidity needs.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 64 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d) (ii) Impairment of financial instruments
The Institute has financial assets that are subject to IFRS 9’s new expected credit loss model. Under IFRS 9, The Institute is required to revise its previous impairment methodology under IAS 39 for each of these classes of assets. The impact of the change in impairment methodology on The Institute’s accumulated funds is disclosed below: ● Financial assets at amortised cost. ● Other financial assets at amortised cost. ● Members subscription receivables. ● Cash and cash equivalents. ● Other receivables.
The total impact on the Institute’s accumulated funds as at 1 January 2018 is as follows: 1 January Notes 2018 N’000
Closing accumulated fund as at 31 December 2017– IAS 39 1,167,571
Increase in provision for membership subscription receivables 30 (582,423) Increase in provision for other receivables 19.1 (80,737) Members subscription receivable 2017 reproposed 2.3.1 427,177
Total transition adjustments (235,982)
Opening accumulated fund as at 1 January 2018 on adoption of IFRS 9 931,589
Reconciliation of statement of financial position balances from IAS 39 to IFRS 9 The Institute performed a detailed analysis of its business models for managing financial assets and analysis of their cash flow characteristics. Please refer to note 2.3.1(i) for more detailed information regarding the new classification requirements of IFRS 9.
The following table reconciles the carrying amounts of financial assets, from their previous measurement category in accordance with IAS 39 to their new measurement categories upon transition to IFRS 9 on 1 January 2018:
IAS 39 IFRS 9 Carrying Carrying Amount Remeasurement Amount N’000 N’000 N’000 Loans and receivables (IAS 39)/Financial assets at amortised cost (IFRS 9)
MEMBERSHIP SUBSCRIPTION RECEIVABLES Opening balance under IAS 39 666,815 – 666,815 Remeasurement: ECL allowance – (582,422) (582,423)
Closing balance under IFRS 9 666,815 (582,422) 84,392
Other receivables Opening balance under IAS 39 108,330 – 108,330 Remeasurement: ECL Allowance – (80,737) (80,737)
Closing balance under IFRS 9 108,330 (80,737) 27,593
CASH AND CASH EQUIVALENTS Opening balance under IAS 39 774,188 – 774,188
Closing balance under IFRS 9 774,188 – 774,188
Total 1,549,333 (663,159) 886,173
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 65 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
The total remeasurement loss of N663million was recognised in opening reserves at 1 January 2018.
The parameters used to determine impairment on the other receivables are shown below. For all receivables presented in the table, the respective 12-month Probability of Default (PD) equate the Lifetime PD for stage 2 as the maximum contractual period over which the Company is exposed to credit risk arising from the receivables is less than 12 months.
Parameters Description Other Receivables
Probability of Default (PD) The credit rating of the counterparty was used to reflect the assessment of the probability of default on this receivable. This was supplemented with external data from S&P to arrive at a 12 month PD and lifetime PD for stage 1 and stage 2 of 7.15%. The PD for stage 3 is 100%.
Loss Given Default (LGD) The 12-month LGD and lifetime LGD were determined using the average recovery rate for Moody’s senior unsecured corporate bonds for emerging economies. This was adjusted with the federal reserve formulae to reflect downturn LGD.
Exposure at Default (EAD) The EAD is the maximum exposure of the receivable to credit risk without taking account of any collateral.
Macro-economic indicators The historical gross domestic product (GDP) growth rate in Nigeria and inflation rate were identified as economic variables affecting the credit risk. Historical data on GDP for the last 44 quarters was used to determine base, optimistic and downturn scenarios with a 75% confidence interval.
Probability weightings 75%, 16% and 9% of historical GDP growth rate observations fall within acceptable bounds, periods of boom and periods of downturn respectively.
The Institute considers both quantitative and qualitative indicators in classifying its financial assets into the relevant stages for impairment calculation. Impairment of financial assets are recognised in three stages on an individual basis as shown below:
Stage 1: This stage includes financial assets that are less than 30 days past due (Performing).
Stage 2: This stage includes financial assets that have been assessed to have experienced a significant increase in credit risk using the days past due criteria (i.e. the outstanding amounts that are more than 30 days past due but less than 90 days past due) and other qualitative indicators such as the increase in political risk concerns or other micro-economic factors and the risk of legal action, sanction or other regulatory penalties that may impair future financial performance.
Stage 3: This stage includes financial assets that have been assessed as being in default (i.e. facilities that are more than 90 days past due) or that have a clear indication that the imposition of financial or legal penalties and/or sanctions will make the full recovery of indebtedness highly improbable.
a) Membership subscription receivables
The membership subscription receivables represent the amount of receivable (annual subscription) from members of the Institute for Subscription, Faculties’ due and Membership Licence granted to members. The Institute applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for trade receivables.
To measure the expected credit losses, these assets have been grouped based on shared credit risk characteristics and the days past due criterion. The expected credit loss rate is determined using a provision matrix approach. The provision matrix approach is based on the historical credit loss experience observed according to the behaviour of customers over the expected life of the receivable and adjusted for forward-looking estimates of relevant macroeconomic variables. The macroeconomic variables considered include inflation and gross domestic product (GDP).
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 66 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
The expected loss rates are as follows: 30-120 120-360 More Than Days Days 360 Days Current Past Due Past Due Past Due Total N’000 N’000 N’000 N’000 N’000 1 January 2018 Gross carrying amount – – 239,638 427,177 666,815 Expected loss rate – – 65% 100% –
Loss allowance – – 155,246 427,177 582,423
30-120 120-360 More Than Days Days 360 Days Current Past Due Past Due Past Due Total N’000 N’000 N’000 N’000 N’000 31 December 2018 Gross carrying amount – – 55,494 666,815 722,309 Expected loss rate – – 65% 92% –
Loss allowance – – 35,951 611,256 647,207
The reconciliation of the gross carrying amount for membership subscription receivables is as follows:
N’000 Gross carrying amount as at 1 January 2018 666,815 Additions during the year 676,071 Receipts for the year (620,577)
Gross carrying amount as at 31 December 2018 722,309
The reconciliation of loss allowances for membership subscription receivables as at 31 December 2018 is as follows:
N’000 Loss allowance as at 31 December 2017 – calculated under IAS 39 – Increase in impairment losses on transition 582,423
Loss allowance as at 1 January 2018 – calculated under IFRS 9 582,423 Increase in provision for impairment loss during the year 64,784
Loss allowance as at 31 December 2018 – Under IFRS 9 647,207
b) Other receivables
This includes receivables from special projects, MCPE receivables and other debtors. The Institute applies the IFRS 9 general model for measuring expected credit losses (ECL). This requires a three-stage approach in recognising the expected loss allowance for financial assets held at maturity.
The ECL recognised for the period is a probability-weighted estimate of credit losses discounted at the effective interest rate of the financial asset. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Fund in accordance with the contract and the cash flows that the Institute expects to receive).
The following analysis provides further detail about the calculation of ECLs related to these financial assets. The Institute considers the model and the assumptions used in calculating the ECLs as key sources of estimation uncertainty.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 67 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
Stage 1 Stage 2 Stage 3 12-month Lifetime Lifetime ECL ECL ECL Total N’000 N’000 N’000 N’000 1 January 2018
Gross EAD* 29,458 – 106,081 135,539 Loss allowance (1,865) – (106,081) (107,946)
Net EAD 27,593 – – 27,593
Stage 1 Stage 2 Stage 3 12-month Lifetime Lifetime ECL ECL ECL Total N’000 N’000 N’000 N’000 31 December 2018
Gross EAD* 28,663 – 124,412 153,075 Loss allowance (2,003) – (124,412) (126,415)
Net EAD 26,660 – – 26,660
The reconciliation of the gross carrying amount of other receivables is as follows:
N’000
Gross carrying amount as at 1 January 2018 135,539 Additions during the year 23,975 Receipts for the year (6,439)
Gross carrying amount as at 31 December 2018 153,075
Stage 1 Stage 2 Stage 3 12-month Lifetime Lifetime ECL ECL ECL Total N’000 N’000 N’000 N’000 1 January 2018
Loss allowance at 31 December 2017 – IAS 39 – – 27,209 27,209 Amounts adjusted through opening retained earnings 1,864 – 78,872 80,736
Loss allowance at 1 January 2018 1,864 – 106,081 107,945
MOVEMENTS IN THE YEAR:
Transfers: New financial assets originated 18,470 – – 18,470
Net impairment loss during the year (profit or loss) 18,470 – – 18,470
Loss allowance at 31 December 2018 20,334 – 106,081 126,415
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 68 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
c) Financial assets at amortised cost
The financial assets include staff loans and advances to district societies, the institute assessed the balances as at 1 January 2018 and 31 December 2018, the balances were deemed to be insignificant.
d) Cash and cash equivalents
Cash and bank balances include investment in treasury bills, bank deposits (dedicated fund and other short term) and cash in hand and at bank.
(i) Investment in treasury bills and bank fixed deposits The Institute applies the IFRS 9 general approach to measuring expected credit losses for cash and bank balances, these assets were low risk and therefore are in Stage 1. The ECL was calculated as the probability weighted estimate of the credit losses expected to occur over the contractual period of the facility after considering macroeconomic indicators. The expected credit loss were considered immaterial as a result no adjustment was made.
(ii) Investment in treasury bills and bank fixed deposits The Institute also assessed the expected losses on other cash and bank balances as at 1 January 2018 and 31 December 2018 to be insignificant as the loss rate is deemed to be immaterial. The assets are assessed to be in stage 1. Other cash and bank balances relates to cash at bank and cash in hand.
RECONCILIATION OF IMPAIRMENT LOSS ON FINANCIAL ASSETS
Movements in the provision for impairment of financial assets are assessed as follows:
N’000
At 31 December 2017 27,209 Impact on initial application of IFRS 9 (1 January 2018) 663,159
At 1 January 2018 690,368
Allowance for impairment recognised during the year 83,254
At 31 December 2018 773,622
IFRS 15 – Revenue from contracts with customers
The Institute has adopted IFRS 15 Revenue from Contracts with Customers from 1 January 2018 which resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. In accordance with the transition provisions in IFRS 15, the Institute has adopted the new rules retrospectively and has restated comparatives for the 2017 financial year. In summary, the following adjustments were made to the amounts recognised in the balance sheet at the date of initial application (1 January 2018) and the beginning of the earliest period presented (1 January 2017):
The adoption of the new standard requires the Company to apply the five (5)-step model for recognising revenue. The impact of adoption on the Company’s accounting policies is as follows:
IAS 18 IFRS 15 Carrying Carrying Amount Remeasurement Amount 31 December 1 January 2017 2018 N’000 N’000 N’000
Membership subscription receivables – 666,815 666,815
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 69 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Impact on the financial statements(cont’d)
IAS 18 IFRS 15 Carrying Carrying Amount Remeasurement Amount 31 December 1 January 2016 2017 N’000 N’000 N’000
Membership subscription receivables – 427,177 427,177
Impact on the Institute’s accumulated fund as at 1 January 2018 and 1 January 2017 is as follows:
1 January 1 January 2018 2017 Note N’000 N’000
Accumulated fund – after IFRS 9 restatement 931,589 1,382,879 Adjustment to retained earnings from adoption of IFRS 15 30 666,815 427,177
Opening accumulated fund 1 January – IFRS 9 and IFRS 15 1,598,404 1,810,056
EXPLANATION OF IMPACT The Institute previously recognised its revenue from fees and membership subscription for financial memebers, as it considered revenue from non financial members as not being probable.
In applying IFRS 15, the Institute has considered the historical performance of its members in determining the collectibility of revenue. Demand notices are issued at the start of the year and members who have not paid by April of that year are delisted. Delisted members are considered non financial members. In order to return as financial members all past subscriptions outstanding are expected to be paid. Only revenue from members outstanding for no more than 10 years are considered probable and are recognised. Others are deemed non collectible. The impact of this on adoption of IFRS 15 is shown above.
New standards, amendments and interpretations not yet adopted
2.4 IFRS 16 Leases
The new standard supersedes IAS 17 and will result in almost all leases being recognised on the balance sheet by lessees as the distinction between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognised; the only exceptions are short-term leases that do not contain a purchase option and low-value leases. The right-of-use assets will be depreciated on a straight-line basis. The liability, recognised as part of borrowings, will be measured at a discounted value using the interest rate implicit in the lease (if that rate can be determined), or the incremental borrowing rate of the lease and any interest will be charged to finance costs in the income statement. Therefore, the charge to the income statement for the operating lease expense will be replaced with depreciation on the right-of-use asset and the interest charge inherent in the lease. The standard does not have any material impact on the Institute.
2.5 Critical accounting estimates and judgements
The preparation of the Institute’s historical financial statements in accordance with IFRSs requires the use of certain accounting estimates which, by definition, will seldom equal the actual results. Management also exercises judgement and assumptions in applying the Institute’s accounting policies.
This note provides an overview of the areas that involve a higher degree of judgement or complexity, and major sources of estimation uncertainty that have a significant risk of resulting in a material adjustment within the next financial year. Detailed information about each of these estimates and judgements is included in the related notes together with information about the basis of calculation for each affected line item in the financial statements.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 70 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Critical accounting estimates and judgements (cont’d)
ESTIMATES AND ASSUMPTIONS The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are described below. The Institute based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments may change due to market changes or circumstances arising that are beyond the control of the Institute. Such changes are reflected in the assumptions when they occur.
MEASUREMENT OF THE EXPECTED CREDIT LOSS ALLOWANCE The measurement of the expected credit loss allowance for financial assets measured at amortised cost and FVOCI is an area that requires the use of complex models and significant assumptions about future economic conditions and credit behaviour (e.g. the likelihood of customers defaulting and the resulting losses). Explanation of the inputs, assumptions and estimation techniques used in measuring ECL is further detailed in Note 2.3.1, which also sets out key sensitivities of the ECL to changes in these elements.
A number of significant judgements are also required in applying the accounting requirements for measuring ECL, such as: ► Determining criteria for significant increase in credit risk; ► Choosing appropriate models and assumptions for the measurement of ECL; ► Establishing the number and relative weightings of forward-looking scenarios for each type of product/market and the associated ECL; ► Establishing groups of similar financial assets for the purposes of measuring ECL.
3. SIGNIFICANT ACCOUNTING POLICIES
3.1.1 Dividend income
Dividend income from investment is recognised when the Institute’s right to receive payment is established.
3.1.2 Investment income
Investment income is recognised in the statement of comprehensive income as it accrues by using the effective interest rate method. Fees and commission that are integral part of the effective yield of the financial asset or liabilities are recognised as adjustment to the effective interest rate of the financial instrument.
3.1.3 Rental income
Rental income relates to income from the use of Amuwo Odofin building for social activities and rent collected from Akintola Williams House, Abuja. Both property are classified as investment property. Rental income is recognised on accrual basis.
3.1.4 Donations to the Institute
The Institute receives donations from its members and other stakeholders, which are generally non-reciprocal transfers, involve transfers from entities other than the owners and these contributions are voluntary. These donations whether cash or asset (e.g. Property, Plant and Equipment) shall be recognised as income in the period it is received or receivable when and only when all the following conditions have been satisfied:
(a) There is irrevocable commitment from the donor to the Institute;
(b) It is probable that the economic benefits arising from the donation will flow to the Institute; and
(c) The amount of the donation can be measured reliably.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 71 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Donations to the Institute (cont’d) DONATIONS BY THE INSTITUTE TO INSTITUTIONS AND OTHERS The Institute from time to time as a way to increase it’s awareness among Nigerian students which in turn would increase students’ enrolment of its examination and as part of its corporate social responsibility (CRS) donates by way of non- reciprocal transfers in form of cash and/or assets (e.g. property, plant and equipment). In either way, donation by cash or asset shall be accounted in the Institute’s financial statement as follows:
(a) Donation by way of cash transfers shall be expensed during the year.
(b) Donations by way of assets – On completion this will be capitalised to the property, plant and equipment accounts and subjected to a depreciation rate of 25% (four years) before being fully handed over to the recipients.
3.1.5 Inventories
Inventories are stated at the lower of cost and net realisable value after making adequate provision for obsolescence and damaged items. Cost comprises suppliers’ invoice, prices and other costs incured to bring the stocks to its present location and condition. Cost is determined using the first-in, first-out (FIFO) method.
3.1.6 Investment properties
Investment property are property held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment property are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment property are measured at fair value and it is the Institute’s policy to perform this every three years as this will result in a more appropriate subsequent measurement at fair value. Gains or losses arising from changes in the fair value of investment property are included in statement of comprehensive income in the period in which they arise.
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in income statement in the period in which the property is derecognised.
3.1.7 Property, plant and equipment
All categories of property, plant and equipment are stated initially at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the assets. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Institute and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.
3.1.8 Depreciation
Depreciation of assets commences when assets are available for use. Depreciation is provided on all property, plant and equipment, other than leasehold land which is not depreciated, at rates calculated to write-off the cost or valuation, of each asset on a straight-line basis over its expected useful life, as follows:
Freehold property — Not depreciated Buildings — 2% Lecture theatres — 25% Motor vehicles — 33% Office furniture and fittings — 25% Computer hardware equipment — 25% Plant and machinery — 25% Library books — 25%
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 72 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
SIGNIFICANT ACCOUNTING POLICIES (cont’d)
3.1.9 Impairment of financial assets
At each balance sheet date, the Institute reviews the carrying amounts of its financial assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset. The Institute estimates the recoverable amount of the cash-generating unit to which the asset belongs. An impairment loss is charged to the statement of comprehensive income immediately unless the asset is carried at its revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of a previously recognised revaluation surplus for the same asset.
3.1.10 Intangible assets and impairment
Expenditure on research activities is recognised as an expense in the period in which it is incurred. A separately acquired intangible assets arising from ICAN’s development projects is recognised only if all the following conditions are met:
i. It is technically feasible to complete the product so that it will be available for use;
ii. The intention is to complete the product for internal use or to sell it;
iii. It is probable that the asset created will generate future economic benefits; and
iv. The development cost of the asset can be measured reliably.
Where no separately acquired intangible asset can be recognised, development expenditure is recognised as an expense in the period in which it is incurred. Directly attributable costs that are capitalised include development project consultant costs and an appropriate portion of relevant overheads. Development expenditures previously recognised as an expense are not recognised as an asset in a subsequent period. Separately acquired intangible assets are amortised over their estimated useful lives, which are usually no more than five years. Amortisation begins when the intangible asset is available for use.
IMPAIRMENT OF NON-FINANCIAL ASSETS Intangible assets which are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.
3.1.11 Foreign currency translation
For the purpose of these financial statements, the results and financial position of the Institute are expressed in Naira, which is the functional currency of the Institute, and the presentation currency for the financial statements.
TRANSACTIONS AND BALANCES Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from the translation at exchange rates of monetary assets and liabilities denominated in currencies other than the Instittue’s functional currency are recognised in Statement of Comprehensive Income within other income. Monetary items denominated in foreign currency are translated using the closing rate as at the reporting date.
3.1.12 Defined contribution plan
The Institute operates a defined contribution based retirement benefit scheme for its staff, in accordance with the Pension Reform Act of 2014 with employee contributing 10% and employer contributing 10% each of the employee’s relevant emoluments. Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered the service entitling them to the contributions.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 73 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
SIGNIFICANT ACCOUNTING POLICIES (cont’d)
3.1.13 Contract assets/liabilities
Subscriptions, interest and conference incomes received in advance are deferred to the period it relates. Interest expenses paid in advance on car loans to staff using effeivtive interest rate is deferred to the period it relates.
3.1.14 Provisions
Provisions are recognised when the Institute has a present obligation (legal or constructive) as a result of a past event, it is probable that the Institute will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimate to settle present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.
3.2 Financial risk management
3.2.1 Introduction and overview of the Institute’s risk management
This note presents information about the Institute’s exposure to financial risks and the Institute’s management of capital.
CREDIT RISK Credit risk is the risk of suffering financial loss, should any of the Institute’s members, students or market counterparties fail to fulfil their contractual obligations to the Institute. Credit risk arises mainly from cash and cash equivalents, membership subscription receivables and credit exposures to other parties (i.e. other receivables).
Credit risk is the single largest risk for the Institute’s business, management therefore carefully manages its exposure to credit risk.
a) Credit risk management
The Institute’s risk management policies are established to identify and analyse the risks faced by the Institute, to set appropriate risk limits and controls, to monitor risks and adherence to limits, the Institute regularly monitors and reviews its exposure with key banking and investment manager, suppliers and for deposits, only independently rated banks and financial institutions with a minimum rating of ‘A’ are used. The Institute’s trade receivables relate substantially to members’ and students’ fees and subscriptions.
The credit risk analysis below is presented in line with how the Institute manages the risk. The Institute manages its credit risk exposure based on the carrying value of the financial instruments as this represents its maximum exposure.
The maximum exposure to credit risk as at the reporting date is: 31 December 31 December 2018 2017 Note N’000 N’000
Financial assets at fair value through OCI (FVOCI) 16 74,981 138,757 Financial assets at amortised cost 17 41,950 37,029
Other financial assets at amortised cost: Members’ subscription receivable 30 722,309 666,815 Other receivables 19 153,075 135,539 Cash and cash equivalent 22 495,962 774,188
Gross amount 1,371,346 1,576,542 Impairment of financial assets- ECL 2.3.1 (773,622) (690,368)
Net amount 597,724 886,174
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 74 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Financial risk management (cont’d)
The carrying amounts of the financial assets as per the financial statements approximate their fair values. Thegross carrying amount of the Institute’s financial assets have been disclosed using the days past due criteria and other borrower specific information.
b) Measuring ECL – Explanation of inputs, assumptions and estimation techniques
The Expected Credit Loss (ECL) is measured on either a 12-month (12M) or Lifetime basis depending on whether a SICR has occurred since initial recognition or whether an asset is considered to be credit-impaired. ECLs are the discounted product of the Probability of Default (PD), Exposure at Default (EAD), and Loss Given Default (LGD), defined as follows: ● The PD represents the likelihood of a party defaulting on its financial obligation (as per “Definition of default and credit-impaired”) either over the next 12 months (12M PD), or over the remaining lifetime (Lifetime PD) of the obligation.
● EAD is based on the amounts the Institute expects to be owed at the time of default, over the next 12 months (12M EAD) or over the remaining lifetime (Lifetime EAD).
● Loss Given Default (LGD) represents the Institute’s expectation of the extent of loss on a defaulted exposure. LGD varies by type of counterparty, type and seniority of claim and availability of collateral or other credit support. LGD is expressed as a percentage loss per unit of exposure at the time of default (EAD). LGD is calculated on a 12-month or lifetime basis, where 12-month LGD is the percentage of loss expected to be made if the default occurs in the next 12 months and Lifetime LGD is the percentage of loss expected to be made if the default occurs over the remaining expected lifetime of the loan.
The ECL is determined by projecting the PD, LGD and EAD for each future month and for each individual exposure or collective segment. These three components are multiplied together and adjusted for the likelihood of survival (i.e. the exposure has not prepaid or defaulted in an earlier month). This effectively calculates an ECL for each future month, which is then discounted back to the reporting date and summed. The discount rate used in the ECL calculation is the original effective interest rate or an approximation thereof.
c) Estimation uncertainty in measuring impairment loss
In establishing sensitivity to ECL estimates for membership subscription receivables, other receivables and cash and cash equivalents, four variables (GDP growth rate, unemployment rate, Inflation and US exchange rate) were considered. The Institute’s receivables portfolio reflects greater responsiveness to GDP growth rate and inflation rates.
The tables below shows information on the sensitivity of the carrying amounts of the Institute’s financial assets to the methods, assumptions and estimates used in calculating impairment losses on those financial assets at the end of the reporting period. These methods, assumptions and estimates have a significant risk of causing material adjustments to the carrying amounts of the Institute’s financial assets.
i) Simplified approach:
Expected cash flow recoverable from membership subscription receivables:
The table below demonstrates the sensitivity to a 10% change in the expected cash flows from membership subscription receivables, with all other variables held constant:
Effect On Surplus/Loss For The Year 2018 N’000 (Increase)/decrease in estimated cash flows +10% 70,277
-10% (70,277)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 75 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Financial risk management (cont’d)
The table below shows the sensitivity of the expected credit loss to an inverse and positive change to each forward looking macro variables: GDP Growth Rate 10% Held Constant -10% N’000 N’000 N’000
10% 19,543 6,211 19,543 Inflation rate Held constant (465) – 465 -10% (416,131) (406,122) (396,112)
ii) General approach – Other receivables Significant unobservable inputs
The table below demonstrates the sensitivity to movements in the probability of default (PD) for financial assets classified as stage 1 and stage 2 financial assets, with all other variables held constant. Effect On Surplus/Loss For The Year 2018 N’000 (Increase)/decrease in estimated cash flows +10% (192)
-10% 192
This table shows the sensitivity of the expected credit loss to an inverse and positive change to each forward looking macro variables.
GDP Growth Rate 10% Held constant -10% N’000 N’000 N’000
10% 73 98 124 Inflation rate Held constant (26) – 26 -10% (124) (98) (73)
d) Credit risk exposure
The table below contains an analysis of the credit risk exposure of financial instruments for which an ECL allowance is recognised using the general model. The gross carrying amount of financial assets below also represents The Institute’s maximum exposure to credit risk on these assets.
(i) Other receivables 31 December 2018 Stage 1 Stage 2 Stage 3 Month Lifetime Lifetime 2017 ECL ECL ECL Total Total N’000 N’000 N’000 N’000 N’000
Speculative grade 28,663 – – 28,663 103,363 Default – – 124,412 124,412 32,176
Gross carrying amount 28,663 – 124,412 153,075 135,539 Loss allowance (2,003) – (124,412) (126,415) (107,946) Carrying amount 26,660 – – 26,660 27,593
Standards issued but not yet effective (extract)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 76 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Financial risk management (cont’d)
IFRS 16 Leases – Impact of adoption
Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2018 reporting periods and have not been early adopted by the Institute. The Institute’s assessment of the impact of these new standards and interpretations is set out below:
Title of Standard IFRS 16 – Leases
Nature of Change IFRS 16 was issued in January 2016. It will result in almost all leases being recognised on the balance sheet by lessees, as the distinction between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognised. The only exceptions are short-term and low-value leases.
Impact The Institute does not currently have any lease contract where it is the lessee. However, the Institute is a lessor. It receives rental income from its leased buildings. The accounting for the lessor does not change under IFRS 16, except for additional disclosures.
Mandatory Application Date The Institute will apply the standard from its mandatory adoption date of 1 January 2019. The Institute intends to apply the simplified transition approach and will not restate comparative amounts for the year prior to first adoption.
3.2.3 Liquidity risk
Liquidity risk arises from Institute’s management of working capital. It is the risk that the Institute will encounter difficulty in meeting its financial obligations as they fall due. The Institute manages its liquidity risk by ensuring that it has adequate fund. The Institute receives the majority of its income as subscriptions in the first quarter of the year, or as examination fees, exemption fees, relating to two examination sessions each year. Cash not required for short-term operating purposes is invested to maximise return with an acceptable level of risk. In addition to its own bankers, the Institute uses specialist investment advisers to invest cash surpluses with major banks of suitable credit standing to spread the risk, a maximum of 20% obligor limit is maintained per bank. Cash surpluses are invested in interest bearing fixed and call financial instrument and Federal Government Treasury Bills. At the balance sheet date the Institute held N224 million (2017: N163 million) in term deposits, N100 million (2017: N503 million) in Treasury Bills and N147 million (2017: N105 million) in call accounts. Liquidity is managed to ensure investments are liquidated in a timely manner to meet operating requirements.
3.2.4 Market risk
Market risk arises from Institute’s use of interest bearing, tradable and financial instruments. It is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in the interest rates (interest rate risk), foreign exchange rates (currency risk) or other market factors (other price risk).
Interest rate risk relates to the risk of loss due to fluctuations in both cash flows and the fair value of financial assets and liabilities due to change in market interest rates. The Institute invests surplus cash in the short-term and in doing so exposes itself to the fluctuation in interest rates that are inherent in such a market.
Currency risk relates to the risk that the fair value of future cash flows of financial instruments will fluctuate because of changes in foreign exchange risk. The Institute operates nationally and internationally in affiliation with foreign professional bodies such as IFAC, ABWA and PAFA. It also has foreign District Societies: (USA, Cameroun and UK) and is exposed to foreign currency exchange risk arising from the transfer of foreign currency to these bodies. The Institute mitigates the risk with regards to income because all fees and subscriptions charged by it are in Naira. At the balance sheet date 100% of the Institute’s cash and cash equivalents were held in various Nigeria banks (2017: 100%).
Other price risk relates to the risk of changes in market prices of the available-for-sale investments. The Institute invests surplus cash in a managed fund operated by fund managers and in doing so exposes itself to the fluctuations in price that are inherent in such a market. The Institute’s Finance and General Purposes Committee has given Fund Managers discretionary management of the funds.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 77 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
SIGNIFICANT ACCOUNTING POLICIES (cont’d)
The table below demonstrates the sensitivity to a 10% change in the expected cash flows from equity investments, with all other variables held constant:
Effect on Equity Effect on Equity Investment Investment 2018 2017 N’000 N’000 (Increase)/decrease in estimated cash flows +10% 5,927 13,875 -10% (5,927) (13,875)
Trade payables
Trade payables classified as financial liabilities are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Other payables that are within the scope of IAS 39 are subsequently measured at amortised cost. Others are measured in respect to their applicable standards.
3.2.5 Investment risk
Budgets are prepared on a prudent basis and income from investments is not relied on for ICAN’s ongoing activities. Investments are reviewed on a regular basis.
3.2.6 Capital
The Institute considers its capital to be its accumulated and charitable and trust funds and fair value reserve. Council’s financial objective is to generate a targeted operating position, to build and maintain reserves at a sustainable level, taking into account the various competitive risks. The Institute also aims to achieve additional long-term growth in reserves through the active management of the investment portfolio. A five-year financial plan has been developed which, over the period of the plan, targets an agreed level of accumulated fund. The Finance and General Purposes Committee reviews the financial position of the Institute at each committee meeting. The Institute is not subject to any material externally imposed capital requirements.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 78 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Restated 31 December 31 December 2018 2017 N’000 N’000 4. FEES AND SUBSCRIPTIONS 4.1 Members: Admission fees 35,690 24,990 Annual subscriptions 547,648 644,328 Practicing licence and renewal 25,818 29,105 Faculty registration and subscription 73,500 51,154 Re-admission fees 1,504 1,348 Registration of firms 9,623 – Development levy 24,513 15,184 Graduate membership subscription 1,494 745
719,790 766,854
4.2 Professional students: Subscriptions 106,700 86,525 Registrations 68,041 63,638 Exemption fees 349,750 292,502
524,491 442,665
4.3 ATS students: Subscriptions 11,454 9,566 Registrations 24,924 21,114 Exemption fees 11,706 16,434
48,084 47,114
Total fees and subscriptions 1,292,365 1,256,633
5(a) OPERATING ACTIVITIES
Qualifications and fellowship Professional examinations 1,780,249 1,427,796 ATS examinations 196,233 172,723 Fellowship award conferment 112,946 119,719 New members’ induction 216,263 149,257
2,305,691 1,869,495
Regulation, education and discipline Faculties 76,966 56,877 MCPE 229,566 210,761
306,532 267,638
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 79 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
Restated 31 December 31 December 2018 2017 N’000 N’000 OPERATING ACTIVITIES (cont’d) Conferences and courses Annual Accountants’ conference 781,724 691,203 Annual dinner and Institute merit award 17,774 31,731 UK-USA-CANADA conference 7,114 5,521
806,612 728,455
Publications and stamps Institute members’ seal and stamps 125,101 103,053 Students’ study text 1,190 709
126,291 103,762
Total operating activities 3,545,126 2,969,350
31 December 31 December 2018 2017 N’000 N’000 5(b) OPERATIONAL EXPENDITURE
Qualifications and fellowship Professional examinations 1,056,111 885,555 ATS examinations 231,730 183,636 Fellowship award conferment 35,125 23,862 New members’ induction 107,595 55,136
1,430,561 1,148,189
Regulation, education and discipline Faculties 58,565 51,429 MCPE 142,762 105,956
201,327 157,385
Conferences and courses Annual Accountants’ conference 474,165 423,971 Annual dinner and Institute merit award 18,489 20,888 UK-USA-CANADA conference 41,645 11,162
534,299 456,021
Publications and stamps Institute members’ seal and stamps 7,169 5,183
7,169 5,183
Total operational expenditure 2,173,356 1,766,778
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 80 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
5(c) ANALYSIS OF OPERATIONAL ACTIVITIES Period ended December 31, 2018 GROSS GROSS NET INCOME/ INCOME EXPENDITURE EXPENDITURE N’000 N’000 N’000 Qualifications and Fellowship Professional examinations 1,780,249 (1,056,111) 724,138 ATS examinations 196,233 (231,730) (35,497) Fellowship award conferment 112,946 (35,125) 77,821 New members’ induction 216,263 (107,595) 108,668
2,305,691 (1,430,561) 875,130
Regulation, education and discipline Faculties 76,966 (58,565) 18,401 MCPE 229,566 (142,762) 86,804
306,532 (201,327) 105,205
Conferences and courses Annual Accountants’ conference 781,724 (474,165) 307,559 Annual dinner and Institute merit award 17,774 (18,489) (715) UK-USA -CANADA conference 7,114 (41,645) (34,531)
806,612 (534,299) 272,313
Publications and stamps Institute members’ seal and stamps 125,101 (7,169) 117,932 Students’ study text 1,190 – 1,190
126,291 (7,169) 119,122
Total net surplus from operational activities 3,545,126 (2,173,356) 1,371,770
5(d) ANALYSIS OF OPERATIONAL ACTIVITIES Year ended December 31, 2017
Qualifications and fellowship Professional examinations 1,427,796 (885,555) 542,241 ATS examinations 172,723 (183,636) (10,913) Fellowship award conferment 119,719 (23,862) 95,857 New members’ induction 149,257 (55,136) 94,121
1,869,495 (1,148,189) 721,306
Regulation, education and discipline Faculties 56,877 (51,429) 5,448 MCPE 210,761 (105,956) 104,805
267,638 (157,385) 110,253
Conferences and courses Annual Accountants’ Conference 691,203 (423,972) 267,231 Annual dinner and Institute merit award 31,731 (20,888) 10,843 UK-USA-CANADA conference 5,521 (11,161) (5,640)
728,455 (456,021) 272,434
Publications and stamps Institute members’ seal and stamps 103,053 (5,181) 97,872 Students’ study text 709 – 709
103,762 (5,181) 98,581
Total net surplus from operational activities 2,969,350 (1,766,776) 1,202,573
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 81 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 2018 2017 N’000 N’000 6(a) INVESTMENT INCOME
Investment income 1,755 13,409 Rental income 48,017 44,416
49,772 57,825
6(b) OTHER INCOME
Income from sale of store items 2,988 6,126 Accreditation fees 3,571 5,060 Contractors’ registration fees 2,173 1,980 Exchange (loss)/gains 1,000 (2,101) Insurance commission 2,113 1,749 Advertisement income 603 1,928 Insurance claims 1,184 6,668 Profit on disposal of property, plant and equipment 8,428 1,155 Transcripts fees 14,812 6,972 E-Library/web service 59 27 SSPC management fee 1,536 1,672 University of Lagos-endowment fund 110 1,453 Reissue of certificate 458 551 Research seminar 2,855 4,742 Commission on advert 235 340 Hire of vehicles 110 110 Examination results/scripts 450 572 Change of name 543 326 Group internet 253 185 Replacement of ID cards/others 284 4 Entrepreneur seminar 2,288 5,828
46,053 45,347
6(c) INTEREST INCOME
Interest income from bank deposit and treasury bills 42,210 83,795
7. INTERNATIONAL AFFILIATION COSTS
IFAC: Subscription 29,107 27,045 Travelling and other meeting expenses 34,724 53,134
63,831 80,179 ABWA: Subscription 24,446 19,201 Travelling and other meeting expenses 24,108 20,658
48,554 39,859 PAFA: Subscription 27,465 39,037 Travelling and other meeting expenses 29,613 14,824
57,078 53,861
Chartered Accountants Worldwide: Subscription 2,012 –
Total International affiliation costs 171,475 173,899
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 82 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 2018 2017 N’000 N’000
8. DEPRECIATION AND AMORTISATION
Depreciation of property, plant and equipment 219,453 195,652 Amortisation of intangible asset 12,370 12,370
231,823 208,022
9. GENERAL AND ADMINISTRATIVE EXPENSES
General repairs and maintenance 121,321 95,867 Council and committee meeting expenses 146,438 199,140 Annual general meeting expenses 29,456 28,794 Insurance 27,641 27,563 Local and overseas tours and other activities 175,698 176,794 Co-ordination of district societies 103,482 96,510 Subscription and donations 36,585 35,416 Advertisements and publicity 30,729 12,293 Printing, photocopy and stationery 25,693 22,938 Telephone and postages 64,096 50,463 Vehicle running costs 63,292 59,028 Travelling expenses 69,162 60,080 Library expenses 15,449 8,875 Refreshment at meetings 35,888 16,491 Loss on currency translation 2,980 – Computer expenses 15,229 14,763 Audit fees 13,000 13,000 Bank charges 11,063 9,587 Other expenses 13,951 7,581
1,001,153 935,183
10. PERSONNEL COST
Basic salary 390,693 379,963 Defined contribution costs 64,961 57,989 Other allowances and related costs 516,965 451,651
972,619 889,603
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 83 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 2018 2017 N’000 N’000 11(a) OTHER OPERATIONAL EXPENDITURE
Contribution to students special project (SSP) 20,466 15,088 Institute members’ welfare scheme 38,073 19,799 Professional charges 46,037 19,019 Accreditation and visitation expenses 23,975 20,956 Catch Them Young awareness programme 29,403 26,723 Scholarship Scheme 29,220 25,971 Education and training expenses 90,386 38,627 The Nigerian Accountant journal 7,628 8,447 Research grants and expenses 68,773 23,462 Subscription to professional bodies 5,519 4,420 Research journal 13,218 7,612 ICAN students’ journal 1,082 7,057 PAFA conference – 20,232 Syllabus review 41,342 15,782 Entrepreneur Scheme 3,846 – Prizes – Students 2,874 1,349 World Congress of Accountants 96,183 –
518,025 254,544
11(b) IMPAIRMENT CHARGES
Impairment charges on other receivables (Note 19.1) 18,470 – Allowance for credit loss (Note 30) 64,784 –
83,254 –
12. ACTIVITIES RESULT
The activities result includes the following:
(a) Salaries and related costs The costs of employing staff during the year were as follows: Staff costs 390,693 379,963 Defined contribution costs 64,961 57,989 Other allowances 516,965 451,651
972,619 889,603
(b) Depreciation and amortisation Depreciation of property, plant and equipment 219,453 195,653 Amortisation of intangible asset 12,370 12,370
231,823 208,023
(c) Auditors’ remuneration Fee payable to joint auditors 13,000 13,000
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 84 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
13. PROPERTY, PLANT AND EQUIPMENT
Land Buildings Motor Plant Furniture Library Lecture Work-In- Total Vehicles and and Books Theatres Progress Machinery Equipment N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 N’000 COST Balance at 1 January 2017 26,203 740,532 316,443 75,556 406,610 49,344 207,327 117,318 1,939,333
Additions – – – – 31,037 4,214 112,237 – 147,488 Disposals – – (20,948) – – – – – (20,948) Reclassification – – – – 116,918 – 400 (117,318) –
Balance at 1 January 2017 26,203 740,532 295,495 75,556 554,565 53,558 319,964 – 2,065,873
Balance at 1 January 2018 26,203 740,532 295,495 75,556 554,565 53,558 319,964 – 2,065,873 Additions – 9,827 198,923 – 60,315 1,446 34,308 9,478 314,297 Disposals – – (55,935) – – – – – (55,935)
Balance at 31 December 2018 26,203 750,359 438,483 75,556 614,880 55,004 354,272 9,478 2,324,235
ACCUMULATED DEPRECIATION Balance at 1 January 2017 – 155,385 278,242 75,549 331,466 28,277 84,471 – 953,390 Depreciation charge for the year – 14,811 20,912 – 71,746 8,193 79,991 – 195,653 Disposals – – (20,948) – – – – – (20,948)
Balance at 31 December 2017 – 170,196 278,206 75,549 403,212 36,470 164,462 – 1,128,095
Balance at 1 January 2018 Depreciation charge for the year – 13,452 57,095 2 64,559 5,634 78,711 – 219,453 Disposals – – (55,935) – – – – – (55,935)
Balance at 31 December 2018 – 183,648 279,366 75,551 467,771 42,104 243,173 – 1,291,613
NET CARRYING AMOUNT
At 1 January 2017 26,203 585,147 38,201 7 75,144 21,067 122,856 117,318 985,943
At 31 December 2017 26,203 570,336 17,289 7 151,353 17,088 155,502 – 937,778
Balance at 31 December 2018 26,203 566,711 159,117 5 147,109 12,900 111,099 9,478 1,032,621
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 85 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000 14. INTANGIBLE ASSETS
Cost Balance at 1 January 78,667 78,667 78,667
Balance at 31 December 78,667 78,667 78,667
Accumulated amortisation and impairment Balance at 1 January 53,923 41,553 29,183 Amortisation for the year 12,370 12,370 12,370
Balance at 31 December 66,293 53,923 41,553
Net carrying Amount: Balance at 31 December 12,374 24,744 37,114
Intangible assets relate to separately incurred development costs on student study text.
15. INVESTMENT PROPERTY
Akintola Williams building, Abuja 831,000 831,000 831,000 Awuwo-Odofin building, Lagos 807,000 807,000 807,000
1,638,000 1,638,000 1,638,000
Investment properties are valued every three years in accordance with the Institute’s policy. The Abuja property is managed by Jide Taiwo & Co. Income generated from both property in 2018 was N48m (2017: N44.4m). The Institute is only occupying about 10% of the property.
16. FINANCIAL ASSETS FVOCI
Quoted investments: At 1 January 138,757 71,877 64,450 Additions – – 16,666 Disposal (30,135) – – (Loss)/profit charged to other comprehensive income (49,348) 66,880 (9,239)
At 31 December 59,274 138,757 71,877
Historical cost of tradable investments 74,981 105,116 105,116
Financial assets FVOCI (previously called Available-for-sales investment) are fair valued annually at the close of business on the date of the financial position. Wherever possible, fair value is determined by reference to stock exchange quoted bid prices. Financial assets FVOCI are classified as non-current assets unless they are expected to be realised within twelve months of the balance sheet date.
Financial assets FVOCI are denominated in Naira. The Institute monitors its exposures by way of regular reports from the Fund managers who have discretionary management of the investment portfolio. None of these financial assets are impaired.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 86 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000 17(a) LOANS AND RECEIVABLES
Staff loans 38,578 31,630 40,408 Staff advances 3,372 3,559 4,453 Owerri district society 840 840 840 Minna district society 1,000 1,000 1,000 Ilorin district society 2,739 2,739 2,739 Impairment allowance for doubtful Owerri & Ilorin District Society (4,579) (2,739) (2,739)
41,950 37,029 46,701
17(b) FINANCIAL ASSETS AT AMORTISED COST
Non-Current 18,575 16,793 21,957 Current 23,375 20,236 24,744
41,950 37,029 46,701
The non-current Financial assets at amortised cost (formerly called loan and receivables) represents the long term portion of the car loans granted to staff.
18. INVENTORIES
Stationery 16,831 19,741 18,112 Electrical parts 47 605 530 Diesel 1,452 4,195 3,605 Students’ study text 68,609 157,112 23,115 Others sellable items 21,141 28,919 9,520 Annual Accountants conference materials – 134 5,302 50th Anniversary Book 11,910 17,358 20,911
119,990 228,064 81,095
19. OTHER RECEIVABLES
Bayelsa ICAN Students’ Special Project (SSP) 12,218 12,218 12,218 NNDC/ICAN Students’ Special Project (SSP) 52,694 35,133 33,548 Cross River/ICAN Students’ Special Project (SSP) 9,703 9,703 9,703 Gombe State/ICAN Students’ Special Project (SSP) 33,377 29,263 28,697 Mutual Alliance Investment & Securities Ltd – 1,671 1,671 Deposit with Aero, Azman and Arik airlines – 1,419 2,765 MCPE receivables 12,570 10,380 7,240 Federal Treasury Academy 10,255 10,255 10,255 Heritage Capital – 5 5 University of Lagos – Endowment fund 16,093 15,983 14,530 ABWA – – 650 Other debtors (Premier & Transcorp Hotel) 6,165 9,509 – Impairment allowance for doubtful receivables (126,415) (107,946) (27,209)
26,660 27,593 94,073
Impairment allowance of N102.4 million includes full provision for Federal Treasury Academy and receivables from students’ special projects.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 87 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000
19.1 MOVEMENT IN IMPAIRMENT ALLOWANCE
At 1 January (107,945) (27,209) (13,029) Charge for the year (18,470) (80,737) (14,180)
At 31 December (126,415) (107,946) (27,209)
20. PREPAYMENT
Group life insurance – ICAN members 9,619 13,808 7,407 Group life insurance – ICAN staff 13,893 11,898 11,661 Motor vehicle, fire and burglary insurance 3,114 3,034 3,182 Annual Accountants’ conference – Hall 12,474 – 5,334 Annual Dinner – Hall 5,000 5,000 – ABWA 6,631 3,000 – Subscriptions prepaid – 8,146 – ATS pool setting/harmonisation 29,690 39,587 7,509 Examination e-marking and syllabus 31,277 – –
111,698 84,473 35,093
21. DEFERRED EXPENSES
At 1 January 5,178 5,240 5,894 Charge for the year (807) (62) (654)
At 31 December 4,371 5,178 5,240
Deferred expenses represent unamortised balance at the reporting date of the difference between the initial amount disbursed and fair value of car loans to staff.
22. CASH AND CASH EQUIVALENTS
Treasury bills 98,825 464,881 631,372 Dedicated funds – Bank deposit 244,817 163,152 3,055 Other short term bank deposit 147,435 105,044 155,993 Cash at bank and in hand 3,710 2,620 –
494,787 735,697 790,420
The effective interest rate on short term bank deposits was 12.5% (2017: 9.71%)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 88 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
23. EMPLOYEES
The average number of persons employed by the Institute during the period was as follows: 31 December 31 December 2018 2017 Number Number Senior managers and directors 34 35 Managers and junior staff 152 156
186 191
Staff cost Wages and salaries 907,658 831,614 Pension costs 64,961 57,989
972,619 889,603
Remuneration of key management personnel (KMP) The Registrar/Chief Executive is the key management personnel (KMP) of the Institute. He has responsibility for implementing Council’s policies and drives the secretariat in promoting the ICAN brand. The KMP has no business relationship with the Institute. The remuneration of the key management personnel of the Institute is set out below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures.
Registrar/Chief Executive Short-term employee benefits 22,340 22,340
22,340 22,340
The number of employees of the Institute whose total earnings were more than N300,000 in the year was: Number Number N300,000 To N900,000 11 11 N900,001 To N1,000,000 5 5 N1,000,001 To N1,100,000 – – N1,100,001 To N1,200,000 6 6 N1,200,001 To N1,400,000 8 8 N1,400,001 To N1,600,000 9 9 N1,600,001 To N2,000,000 21 21 N2,000,001 To N2,100,000 2 2 N2,100,001 To N2,200,000 3 3 N2,200,001 To N2,500,000 8 8 N2,500,001 To N2,600,000 7 7 N2,700,001 To N2,800,000 2 2 N2,800,001 To N2,900,000 – – N2,900,001 To N4,000,000 64 68 N4,000,001 To N4,600,000 19 19 N4,600,001 To N5,200,000 6 6 N5,200,001 To N6,100,000 1 1 N6,000,001 To N6,400,000 – – N6,400,001 To N7,300,000 1 1 N7,300,001 To N7,800,000 3 3 N7,800,001 To N8,100,000 4 5 N8,100,001 To N8,300,000 – – N8,300,001 To N9,400,000 2 2 N9,400,001 To N9,500,000 – – N9,500,001 To N10,100,000 1 1 N10,600,001 To N10,700,000 – – N10,900,001 To N11,600,000 2 2 N11,600,001 To N12,900,000 – – N12,900,001 and above 1 1
186 191
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 89 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000
24. ACCOUNTS PAYABLES
Sundry payables 81,121 69,853 62,930 AAT account balance 21,411 41,634 43,137 Accrued expenses 183,788 311,936 182,755
286,320 423,423 288,822
24(a) SUNDRY PAYABLES
ICAN staff pension fund 18,032 14,491 – Withholding tax (FIRS)/LIRS 11,289 25,222 44,615 Board of Internal Revenue/NASU 6,368 5,266 – National Housing Fund 18,539 24,874 16,994 Akwa Ibom State Government 9,158 – – Onitsha District Society 13,146 – – Conference income received in advance 4,184 – 1,321 Others 405 – –
81,121 69,853 62,930
24(b) ACCRUED EXPENSES
AAT outstanding bills 2,290 6,686 2,402 Examination processes 95,448 167,440 89,291 Audit fees 13,000 13,000 10,000 Students’ and Nigerian Accountant journal – – 6,630 Insurance premium due 6,209 – 9,554 Insurance claims 7,763 24,525 7,450 Faculties expenses 3,980 – – Accountant conference 7,427 – 1,697 Predential travels – – 7,731 Lecture theatres – – 9,504 PAFA subscription 16,788 39,037 11,509 SSPC expenses 2,757 – – Staff promotion arrears 3,226 19,402 12,493 Refunds due to members – Canada conference 4,775 14,599 – Sundry accrual 20,125 27,247 14,494
183,788 311,936 182,755
25. CONTRACT LIABILITIES
Subscription income 19,034 11,416 5,687
19,034 11,416 5,687
Contract liabilities relates to subscriptions in advance received from members.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 90 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000
26. FUNDS
(a) Accumulated fund 924,148 1,171,227 1,810,056
(b) Other charitable and trust funds:
Development fund 1,563,316 1,563,316 1,563,316 Accountancy research fund 145,469 145,469 145,469 Benevolent fund 225,018 171,381 150,645 Prizes fund 10,550 13,422 14,771 Student development and support fund 22,239 33,324 27,771 Study text revolving fund 394,305 317,501 166,814 Library fund 19,690 35,139 50,175
2,380,587 2,279,552 2,118,961
27. THE ANALYSIS OF FUNDS AND OTHER RESERVES
(a) Library Fund
The contribution to Library fund is to obtain all the resources needed for the use of the Institute’s members. This is in line with the Council belief of the need to provide a befitting library facility to help students and members turn information into knowledge. This fund helps fill the gap by providing high quality library facility, necessary materials and equipment. 3% of the Institute’s annual gross income is to be transferred to library development. No transfer were made in 2018 (2017: Nil).
(b) Benevolent Fund
The ICAN members’ Benevolent and Educational Trust Fund was established by Council of the Institute of Chartered Accountants of Nigeria to assist persons in need who are or have been ICAN members and/or their families and dependants. It is also aimed at promoting and supporting educational/research in accountancy, financial Management, taxation and related subjects. The fund is managed by a five man Board of trustees. The major activities of the management board are fund raising and management of investments. 3% of the Annual Accountants’ Conference gross income is credited to the fund annually. The fund generated are invested and it is the income from the investments that are disbursed to members in need and families that are distraught. Since inception, the Fund has been used to assist members and families of dead members. This include members who had renal (kidney) failure, blindness, stroke, spinal cord injuries, disaster (fire/ flood/accident) victims, children’s education, etc. The minimum amount of benefit to applicants is Fifty thousand Naira (N50,000) only; while the maximum shall be a sum of Five Hundred Thousand Naira N500,000) only.
(c) Accountancy Research Fund
Transfers to this fund is based on Council’s resolutions. The fund is made available to meet expenditure on research on specialised areas of accountancy. The fund is invested in fixed deposit and any interest accrued there from is credited to the Fund.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 91 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
THE ANALYSIS OF FUNDS AND OTHER RESERVES (cont’d)
(d) Professorial Chair Endowment
Transfers to this fund is based on Council’s resolutions. The fund is made available to meet expenditure on professorial chair endowment in selected universities. The fund is invested in fixed deposit and any interest accrued there from is credited to the Fund.
(e) Developmental Fund
Transfers to this fund is based on council’s resolutions. The fund is made available to meet expenditure on the Institute’s infrastructural development. The fund is invested in fixed deposit and any interest accrued therefrom is credited to the Fund.
(f) Prizes Fund
This is funded by donors of each prize. The fund is made available to meet expenditure on the award of prizes to deserving outstanding students in the Institute’s examinations. The fund is invested in fixed deposit and any interest accrued there from is credited to the Fund.
(g) Study Text Revolving Fund
This is to be funded by a portion of the amount realised from the sale of study text to students. The fund is available to meet expenditure on development, printing and distribution of study text to student. The fund is invested in fixed deposit and any interest accrued therefrom is credited to the Fund.
(h) Students Development and Support Fund
This is to be funded by surplus realised from the sale of study text and is to be applied to the development and support of students writing the Institute’s examination.
(i) FVOCI reserves
FVOCI reserves represents the excess of unrealised gains and losses on financial assets fair valued through other comprehensive income over their historic costs.
(j) Accumulated Fund
The accumulated fund represent the excess of income over expenditure which have been accumulated over the years.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 92 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
28. RELATED PARTY TRANSACTIONS
Council members as office bearers Razak Jaiyeola (President) Okwuadigbo Anthony Nnamdi (Vice President) Adewuyi Onome Joy (Mrs.) (1st Deputy Vice President) Eyitayo Comfort Olujumoke (Mrs.) (2nd Deputy Vice President) Zakari Isma’ila Muhammadu (Immediate Past President) Oyemolu Olugbenga Akinsulire (Chief) (Honorary Treasurer)
Other Council members Oluwatobi Ayodele Abiola, Solomon Oluwole Adeleke (Deacon), Titilola Ariyike Nurat Akibayo (Alhaja), Davidson Chizuoke Stephen Alaribe (Chief), Chibuzor Noel Anyanechi, Deji Awobotu (Dr.), Felicia Aina Bamgbose, Adaku Chilaka Chidume-Okoro (HRM), Samson Adewale Disu (Rev.), Jude Sunday Egbo, Omehe Gaddafi Peter Ehkoragbon,Tijjani Musa Isa (Mallam), Ahmed Modu Kumshe, Nasiru Muhammadu, Godwin Obaje (Navy Capt.), Olutola Ogundipe, Monica Ngozi Okonkwo, Innocent Okwuosa, Jamiu Olakisan, Tajudeen Adewale Olayinka, Etofolam Felix Osuji (Dr.), Hilda Ofure Ozoh, Queensley Sofuratu Seghosime, Haruna Nma Yahaya (Alhaji)
Non-Council members John I. Evbodaghe (Registrar/Chief Executive), Ben Ukaegbu (Deputy Registrar, Technical Services), Mukaila A. Lawal (Deputy Registrar, Corporate Services)
No member of the Council receives payment in respect of services to ICAN. In line with Council travel and expenses policy, Council members are reimbursed for any expenses which they directly incur on behalf of the Institute as part of their role as a Council member. No loan is granted to related parties.
Restated 31 December 31 December Notes 2018 2017 N’000 N’000 29. CASH FLOW STATEMENT
a) Cash generated from activities (Deficit)/surplus for the year (176,179) 184,921
Adjustments for: Interest received 6a (42,210) (83,795) Movement in accumulated fund (70,900) (160,591) Exchange (loss)/gains 6(b) 1,000 (2,101) Depreciation on property, plant and equipment 13 219,453 195,652 Amortisation of intangible asset 14 12,370 12,370 Profit on disposal of property, plant and equipment 13 (8,428) (1,155)
Changes in working capital (excluding the effects of exchange differences): Decrease/(increase) inventory 108,074 (146,969) (Increase)/decrease in loans and receivables (4,921) 9,672 Increase in prepayments (27,225) (49,380) Decrease in other receivables 933 66,480 Decrease in contract asset 807 62 (Decrease)/increase in trade and other payables (137,103) 134,601 (Decrease)/increase in contract liabilities 7,618 5,729 Increase/(decreased) in members subscription receivable 9,290 (320,373)
Cash used in operating activities (107,420) (154,877)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 93 2018 Annual Report & Financial Statements ► Notes to the FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
CASH FLOW STATEMENT (cont’d)
Restated 31 December 31 December Notes 2018 2017 N’000 N’000 b) Cash from funding activities Decrease in prizes fund (2,872) (1,349) Increase in benevolent fund 53,637 20,736 Decrease in library fund (15,449) (15,006) Increase in study text revolving fund 76,804 150,687 (Decrease)/increase in student development and support fund (11,085) 5,523
101,035 160,591
Restated Restated 31 December 31 December 1 January 2018 2017 2017 N’000 N’000 N’000
30. MEMBERS’ SUBSCRIPTION RECEIVABLE
Subscription receivables 722,309 666,815 427,177 Allowance for credit loss (647,207) (582,423) –
Net receivables 75,102 84,392 427,177
Movement on impairment on receivables: Opening balance (582,423) – – Charge in the year (64,784) (582,423) –
At 31 December (647,207) (582,423) –
31. CONTINGENT LIABILITIES AND COMMITMENTS
There were no contingent liabilities or capital commitments as at the reporting date (2017: Nil).
32. EVENTS AFTER STATEMENT OF FINANCIAL POSITION DATE
There are no significant subsequent events, which could have had a material effect on the state of affairs of the Institute as at 31 December 2018 that have not been adequately provided for or disclosed in the financial statements.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 94 2018 Annual Report & Financial Statements ► Statement of VALUE ADDED FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 2018 2017 N’000 % N’000 %
Income 4,837,491 4,225,983
Other income 138,035 186,967
4,975,526 4,412,950
Purchase of services – Local (3,984,241) (3,051,154)
Value added 991,285 100 1,361,796 100
DISTRIBUTION:
To pay employees Salaries and benefits 972,619 98 889,603 65
To provide for enhancement of assets and growth Depreciation of property, plant and equipment 231,823 24 208,022 16 Amortisation of intangible assets 12,370 1 12,370 1 (Deficit)/surplus in the year (225,527) (23) 251,801 18
Value added 991,285 100 1,361,796 100
This statement represents the distribution of the wealth created through the use of the Institute’s assets by its own and employees’ efforts.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 95 2018 Annual Report & Financial Statements ► Five-Year FINANCIAL SUMMARY FOR THE YEAR ENDED 31 DECEMBER 2018
31 December 31 December 31 December 31 December 31 December 2018 2017 2016 2015 2014 N’000 N’000 N’000 N’000 N’000
ASSETS EMPLOYED
Property, plant and equipment 1,032,621 937,778 985,943 863,804 806,237
Intangible assets 12,374 24,744 37,114 49,484 5
Investment property 1,638,000 1,638,000 1,638,000 1,638,000 1,458,000
Financial assets FVOCI 59,274 138,757 71,877 64,450 85,545
Loans and receivables 18,575 16,793 21,957 11,435 9,770
Net current assets 569,663 762,210 1,169,020 819,826 1,020,552
3,330,507 3,518,282 3,923,911 3,446,999 3,380,109
FINANCED BY
Non-current liabilities 19,034 11,416 5,687 6,386 12,606
Funds and reserve 3,311,473 3,506,866 3,918,224 3,440,613 3,367,503
3,330,507 3,518,282 3,923,911 3,446,999 3,380,109
COMPREHENSIVE INCOME
Income 4,837,491 4,225,983 3,563,750 3,111,957 3,252,171
Surplus of income over expenditure 2,664,135 2,459,205 1,995,385 1,667,702 1,554,711
(Deficit)/surplus for the year (176,179) 184,921 59,673 100,127 (13,597)
OTHER COMPREHENSIVE INCOME:
Items that will be reclassified to profit or loss in subsequent year: Gain/(loss) in fair value of available-for-sale investments – 66,880 (9,239) (34,773) 1,722
Items that will not be reclassified to profit or loss: Loss in financial assets fair valued through other comprehensive income (49,348) – – – –
Total comprehensive (loss)/income for the year (225,527) 184,921 0 50,434 65,354
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 96 2018 Annual Report & Financial Statements ► Financial GRAPHS FOR THE YEAR ENDED 31 DECEMBER 2018
INCOME TRENDS (N’000) 2014 – 2018
RECURRENT EXPENDITURE PATTERN (N’000) (2014 – 2018)
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 97 2018 Annual Report & Financial Statements ► NOTES
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 98 2018 Annual Report & Financial Statements ► NOTES
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA 99 2018 Annual Report & Financial Statements ► I C A N
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA (Established by Act of Parliament No.15 of 1965) Plot 16, Professional Centre Layout, Idowu Taylor Street, Victoria Island, Lagos, Nigeria. P.O. Box 1580, Lagos. Tel: 09053847510, 09053847511 E-mail: [email protected] ICAN Website: www.icanig.org
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