Compliance with International Financial Reporting Standards in Selected Nigerian Listed Companies: Challenges and Prospects

This study evaluates the level of compliance with International Financial Reporting Standards among selected companies listed on the Nigerian Exchange Group and identifies the key challenges and prospects associated with full adoption. Since mandatory IFRS adoption was introduced for listed entities in 2012, compliance has improved significantly, but gaps remain in complex areas such as financial instruments, fair value measurement, and lease accounting. This study uses a content analysis approach, examining the financial statements of 20 listed companies drawn from banking, manufacturing, oil and gas, and consumer goods sectors for the year 2022 to 2023. Compliance is assessed using a checklist aligned with applicable IFRS standards and IASB disclosure requirements. Key compliance gaps and facilitating factors are identified through semi-structured interviews with 45 external auditors and company finance directors. Results reveal that compliance levels are highest in the banking sector, where CBN oversight reinforces IFRS requirements, and lowest in the manufacturing and agribusiness segments. The most common gaps relate to IFRS 16 lease accounting, IFRS 9 expected credit loss provisioning, and IFRS 13 fair value hierarchy disclosures. The study concludes that while significant progress has been made, targeted interventions are needed to close persistent compliance gaps. It recommends that the Financial Reporting Council of Nigeria publish annual industry-specific compliance guidance notes to support preparers in navigating complex IFRS requirements.

Keywords: IFRS compliance, listed companies, Nigerian Exchange Group, financial reporting, FRCN.