We have expanded our capacity and competences to handle some specialized services such as:
We have successfully carried out IFRS conversions for many clients in oil & gas, non-bank Financial Institution, Construction, Trading, and Marketing & Advertising industries.
1. International Financial Reporting Standards (IFRS)
On 28 July 2010, the Nigerian Federal Executive Council (FEC) approved January 2012 as the effective date for the convergence of accounting standards in Nigeria (SAS or NGAAP) to International Financial Reporting Standards (IFRS). The FEC also directed the Financial Reporting council (FRC) to take further necessary actions to give effect to the decision.
On 3rd September 2010, FRC announced a staged implementation for significant public interest entities by January 2012; other public interest entities by January 2013 and SMEs by January 2014.
IFRS is the collection of financial reporting standards developed by the International Accounting Standards Board (IASB), an independent International Standards setting organization. The aim of IFRS is to provide “a single set of high quality, global accounting standards that require transparent and comparable information in general purpose financial statements.
This means that if your company has not converted to IFRS already, you ought to have started the conversion since January 2014 because your financial report for 2014 MUST be in IFRS. You do not need to wait until January 2015 to convert so that you will not run into difficulties in getting most information to complete the conversion.
Should you need our services for the conversion to IFRS, please feel free to contact us.
2. Transfer Pricing Policy Design Implementation & Filing
By the provisions of the Income Tax (Transfer Pricing) Regulation No 2 of 2012, taxpayers are required to file returns of transactions carried out with connected persons (TP Returns) beginning from the basis period after the 2nd day of August 2012. Consequently, the first sets of TP returns are expected to be rendered beginning from January 2014.
Elements of Transfer Pricing Documentation
The three principal elements of transfer pricing documents are:
· TP Policy;
· TP Returns
· TP Documentations
Transfer Pricing Policy (TPP):
TP Policy (TPP) is a document that contains the guiding principles to be adopted by an entity or a group in transfer pricing decisions.
TPP allows for a holistic approach to transfer pricing issues; it integrates the pricing of inter-company transfers with day-to-day operations.
A comprehensive transfer pricing policy will take into account all aspects of business transactions and the business (operational) model.
Types of TP Policy
Contains policies that are applicable throughout the group irrespective of jurisdiction of operation and is usually Head office based.
Usually developed from the group policy in order to take care of differences in:
· Local legislation & TP rules
· Business environments across the globe
· Other peculiarities of the local entities
Features of TP Policies
TP Policy gives guidance to members of a group on how the transfer of goods, services and intangibles within members of the group should be priced. Other features include:
A typical TP Policy shall contain:A typical TP Policy shall contain:
WHO SHOULD FILE TP RETURNS?
The duty to file TP returns applies to all companies and entities that are liable to income tax and who are members of a Nigerian or international group of companies or otherwise connected to one or more companies in Nigeria or overseas.
The following are deemed to be connected persons:
How should Transfer Pricing Returns be filed?
Taxpayers are advised to take the following steps to properly file their TP returns:
A connected taxable person shall record, in writing or any other electronic device or medium, sufficient information or data with an analysis of such information or data to verify that the pricing of controlled transactions is consistent with the arm’s length principle and the connected taxable person shall make such information available to the Service upon written request by the Service” --- Regulation 6(1) 1
Scope of TP Documentation
Please note that this is not all that you need to know about Transfer Pricing Regulation but the basic, sufficient to keep you running. For details contact your Tax Advisers.