Summary
The Financial Reporting Council of Nigeria (FRCN)
has revoked Rule 4 of the FRCN Rules through a public notice (PN)
dated 11 July 2019. Based on Rule 4, transactions that require
approval or registration with statutory bodies could only be
accounted for in audited financial statements after such
registration had been made or approval obtained from the relevant
regulatory body. Thus, with this revocation, companies would now be
able to accrue for expenses incurred in respect of transactions
that are yet to be registered or approved by the relevant statutory
or regulatory body.
Details
FRCN is the regulatory body responsible for supervising how
financial transactions are reported in the audited financial
statements. As part of its functions, it is also responsible for
the issuance and setting of accounting standards adopted by
preparers of financial statements and reports in
Nigeria. In 2016, the FRCN issued Rule 4, which mandated
business entities to
