ABSTRACT

This research "Preparation of Financial statements; challenges and effects of the adoption of International Financial Reporting standards (IFRS) in Nigeria" was designed to bring to lime light the challenges and effects the adoption of IFRS has on the preparation of financial statement in Nigeria. in conducting this research data were collected from 30 respondents (using questionnaires) and analyzed using the regression and correlation sampling techniques which gave result to the following findings: The adoption of International Financial Reporting Standards (IFRS) in the preparation of financial statements in Nigeria has proved very difficult and challenging even though its adoption is expected to have a positive effect on the Nigerian companies and Nigeria at large. Very few Nigerian companies have adopted some part of the lFRS while quite a larger number are skeptical and unwilling to give up their old standards (statement of Accounting Standards, SAS) for this new one. This could be blamed on the variations in accounting policy disclosure amongst countries, unfamiliarity with standards, imbalance in the financial sector of Nigeria, variation, of figures in. financial statement on the introduction of IFRS, change in accounting policies, extra expenses in the training of staff on the application of lFRS, complexity and difficulty of IFRS application, lack of enforcement by the Nigerian Accounting Standard Board (NASB) and also on the irrelevance of seme IFRS to the Nigerian situation. It is however very important that the adoption of lFRS is enforced in Nigeria not only in the preparation of financial statement but, every aspect of Accounting since it enhances accountability, transparency, efficiency, uniformity, comparability, globalization and effective global market. SAS as it stands is faced with numerous limitations ranging from its limited coverage to its outdated standards this therefore makes the adoption of IFRS very paramount to the development and globalization of Nigeria as this will increase her attractiveness not only to investors but to the world at large.