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Nigerian companies must prepare and file financial statements that meet statutory and regulatory requirements. Understanding these requirements helps you maintain compliance and produce meaningful financial information. This guide covers what financial statements you need and how to prepare them.

Legal Framework

Companies and Allied Matters Act (CAMA)

CAMA requires Nigerian companies to:

Keep proper accounting records
Prepare annual financial statements
Have accounts audited (with some exceptions)
File with the Corporate Affairs Commission (CAC)

Financial Reporting Council (FRC)

The FRC oversees:

Accounting standards in Nigeria
Auditing standards
Financial reporting quality
Registration of accountants

IFRS Adoption

Nigeria has adopted International Financial Reporting Standards:

Full IFRS for public interest entities
IFRS for SMEs for smaller entities
Mandatory compliance for filing

Required Financial Statements

Complete Set of Financial Statements

A full set includes:

Statement	Purpose
Statement of Financial Position	Shows assets, liabilities, and equity at a point in time
Statement of Profit or Loss and Other Comprehensive Income	Shows financial performance over a period
Statement of Changes in Equity	Shows movements in shareholders' funds
Statement of Cash Flows	Shows cash inflows and outflows
Notes to the Financial Statements	Provides detailed disclosures

Statement of Financial Position

Also known as the Balance Sheet:

ABC COMPANY LIMITED Statement of Financial Position As at December 31, 2024 ASSETS ₦'000 Non-Current Assets Property, Plant and Equipment 50,000 Intangible Assets 5,000 ------- 55,000 Current Assets Inventories 20,000 Trade Receivables 25,000 Cash and Cash Equivalents 10,000 ------- 55,000 ------- TOTAL ASSETS 110,000 ======= EQUITY AND LIABILITIES Equity Share Capital 30,000 Retained Earnings 35,000 ------- 65,000 Non-Current Liabilities Long-term Borrowings 20,000 Current Liabilities Trade Payables 15,000 Current Tax Payable 5,000 Short-term Borrowings 5,000 ------- 25,000

------- TOTAL EQUITY AND LIABILITIES 110,000 =======

Statement of Profit or Loss

ABC COMPANY LIMITED
Statement of Profit or Loss For the Year Ended December 31, 2024
₦'000 Revenue                                    200,000 Cost of Sales                             (120,000)
-------- Gross Profit                                80,000 Other Income                                 2,000 Administrative Expenses                    (30,000) Selling and Distribution Expenses          (15,000)
-------- Operating Profit                            37,000 Finance Costs                               (2,000)
-------- Profit Before Tax                           35,000 Income Tax Expense                         (10,500)
-------- Profit for the Year                         24,500 ========

Statement of Cash Flows

ABC COMPANY LIMITED Statement of Cash Flows For the Year Ended December 31, 2024 ₦'000 Operating Activities Profit before tax 35,000 Adjustments: Depreciation 5,000 Interest expense 2,000 Working capital changes (3,000) -------- Cash from operations 39,000 Tax paid (8,000) -------- Net cash from operating activities 31,000 Investing Activities Purchase of equipment (15,000) Sale of assets 2,000 -------- Net cash used in investing (13,000) Financing Activities Loan proceeds 10,000 Loan repayments (5,000) Dividends paid (10,000) Interest paid (2,000) -------- Net cash used in financing (7,000) -------- Net increase in cash 11,000 Cash at beginning (1,000)

-------- Cash at end 10,000 ========

Notes to Financial Statements

Required Disclosures

Notes must include:

Disclosure Area	Examples
Accounting policies	Revenue recognition, depreciation methods
Significant judgments	Estimates, assumptions
Property, plant and equipment	Movements, depreciation
Inventory	Categories, valuation
Trade receivables	Aging, provisions
Borrowings	Terms, maturity
Related party transactions	Directors, shareholders
Contingencies	Legal cases, guarantees
Events after reporting date	Significant events

Example Note: Property, Plant and Equipment

Note 6: Property, Plant and Equipment Land Buildings Equipment Total ₦'000 ₦'000 ₦'000 ₦'000 Cost At January 1, 2024 10,000 30,000 25,000 65,000 Additions - 5,000 10,000 15,000 Disposals - - (3,000) (3,000) At December 31, 2024 10,000 35,000 32,000 77,000 Depreciation At January 1, 2024 - 10,000 12,000 22,000 Charge for year - 1,750 3,250 5,000 Disposals - - (2,000) (2,000) At December 31, 2024 - 11,750 13,250 25,000

Net Book Value At December 31, 2024 10,000 23,250 18,750 50,000 At December 31, 2023 10,000 20,000 13,000 43,000

Who Must Prepare Financial Statements?

All Registered Companies

Company Type	Requirement
Public companies	Full IFRS, audited
Private companies (large)	IFRS/IFRS for SMEs, audited
Private companies (small)	IFRS for SMEs, may be exempt from audit

Small Company Exemptions

Under CAMA, small companies may be exempt from audit if they meet criteria:

Turnover below threshold
Assets below threshold
Employee count below threshold

Check current thresholds and conditions.

IFRS vs IFRS for SMEs

Full IFRS

Required for:

Listed companies
Banks and financial institutions
Insurance companies
Large companies meeting criteria

IFRS for SMEs

Permitted for:

Private companies
Not publicly accountable
Not required to use full IFRS

Key Differences

Area	Full IFRS	IFRS for SMEs
Complexity	More complex	Simplified
Disclosures	Extensive	Reduced
Options	More choices	Fewer options
Updates	Frequent	Less frequent

Filing Requirements

CAC Filing

Annual returns include:

Financial statements
Auditor's report (if applicable)
Directors' report
Filing fee

Filing Deadline

Within 42 days after the Annual General Meeting, and AGM must be held within 6 months of year-end.

Year-End	AGM Deadline	Filing Deadline
December 31	June 30	Mid-August

Penalties for Late Filing

Offense	Consequence
Late filing	Penalties
Non-filing	CAC enforcement
False information	Criminal liability

Tax Filing Alignment

CIT Returns

CIT returns include financial statement information:

Revenue and expenses
Taxable profit computation
Filed within 6 months of year-end

Reconciliation

Financial statements must reconcile to tax returns:

Accounting profit → Taxable profit
Tax adjustments disclosed
Supporting schedules provided

How Finora Supports Financial Reporting

Real-Time Financial Statements

Generate statements anytime:

Statement of Financial Position
Statement of Profit or Loss
Statement of Cash Flows
Trial Balance

IFRS-Ready Format

Reports follow IFRS presentation:

Proper classifications
Required line items
Standard formats

Period Comparisons

Compare with prior periods:

Current vs previous year
Current vs budget
Trend analysis

Audit Trail

Support audit requirements:

Complete transaction history
Document attachments
User tracking

Export and Reporting

Format	Use
PDF	Presentation and filing
Excel	Analysis and audit
Print	Physical copies

Frequently Asked Questions

Do all companies need audited accounts?

Most Nigerian companies require audited accounts. Small companies meeting specific criteria may be exempt. Check CAMA provisions and your company's status.

Can I prepare financial statements myself?

Yes, but statutory financial statements typically require professional preparation and audit. Consider engaging accountants for compliance.

What's the penalty for wrong financial statements?

Misleading financial statements can result in penalties for directors, CAC sanctions, and potential legal action from affected parties.

Do I need to file financial statements if I'm not trading?

Dormant companies still have filing obligations. File dormant company accounts or consider voluntary strike-off if permanently inactive.

When do I need to transition to IFRS?

Nigerian companies should already be using IFRS or IFRS for SMEs. If not, transition should happen immediately.

Conclusion

Nigerian companies have clear financial statement requirements:

Prepare complete financial statements per IFRS
File with CAC within deadlines
Obtain audit unless exempt
Align with tax filings

Proper financial statements are essential for:

Legal compliance
Tax compliance
Business management
Stakeholder confidence

Finora generates IFRS-ready financial statements from your accounting data, ensuring you always have accurate reports for management, compliance, and filing.

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