History of the accounting profession in Nigeria

The general history of accounting can be traced to after God drove Adam and Eve from the Garden of Eden. The scriptures make it clear that men started learning new tasks themselves and were putting them to use. This includes building and of course accounting (although, not alrighty stated). However, accounting can be traced to the Italian merchants who employ the services of stewards in taking care of their business endeavors. To make it understandable, we have divided the historical development of accounting into six sections. 

Before the Industrial Revolution

Before the Industrial Revolution in Europe, accounting was done and known. Also, Luca Paciolo introduced the double-entry system of bookkeeping in 1494 leading to the theory and practice of the subject as it is taught in schools today. It is believed that Paciolo was not the first person to mention the term double entry principle. They believe that it was widely used by stewards who helped merchants at that time to record their transactions. In Luca Paciolo's books Summa de Arithmetica, geometrica, proportionate el proportionalita, he also explains journal books, ledger books, and trial balance.

During the Industrial Revolution

The Industrial Revolution changed the game of accounting. It was during this time professional bodies sprang out to help the various factories that were established throughout Europe in the early 19th century. It was during this period that profit and loss statements and balance sheets were introduced along with value-added statements and statements of flow of funds. Also, to ensure that all accountants have one mind in the preparation of these statements, the accounting standards were established and professional accountants were taught these standards to enable them to serve businesses effectively. 

Before 1960 Independence

The history of accounting in Nigeria can be traced to the colonial masters, the British government. From 1914 when Nigeria was formed some forms of taxation were enforced by the British government. Also, they bring in companies including Barclays Bank, now the first bank in Nigeria before independence. This would have provided many Nigerians the privilege to travel to the United Kingdom to learn accounting and acquire professional certification.

From 1960 to 1999

The accounting profession got its roots more stable in Nigeria when the Institute of Chartered Accountants of Nigeria (ICAN) was established. This body spearheaded the accounting profession in Nigeria down to this day. Other accounting bodies such as the Association of National Accountants of Nigeria (ANAN) and the Chartered Institute of Taxation Nigeria (CITN) were formed. The goal of establishing these two additional bodies was to reduce the monopoly gained by ICAN over the years. 

History of Accounting from 1999 to present days

The introduction of civilian or democratic rule in 1999 changed the accounting game. As a result, the first democratically elected president introduced the use of GSM and this led to the World Wide Web, internet, and computers in Nigeria. Companies are behind in adopting this technology. As a result, accounting software was being used by these companies instead of manual accounting that was done before 1999. 

Other events such as the adoption of the international financial reporting standards by the accounting standard board in Nigeria (known as the Financial Reporting Council Nigeria) took effect. Also, there was a memorandum of agreement by ICAN, ANAN, and CITN in the practice of accounting. Members of ICAN and ANAN were to practice the audit profession. While CITN members are to focus on taxation.

The future of the accounting profession

With the introduction of artificial intelligence in 2023, critics believe that it will bring an end to the accounting profession. But with further research, it has been proven that AI cannot replace the profession. Instead, it is believed that it will enhance it and make professional accountants more effective and efficient in carrying out their tasks. Companies like Sage and QuickBooks are adding AI to their software to improve the job of the finance professional.