Elvis Onuora & Co (Chartered Accountants)
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We have expanded our capacity and competences to handle some specialized services such as:

  1. Conversion from NGAAP to IFRS
  2. Deferred tax computations in line with IFRS/IAS
  3. Transfer Pricing policy design, implementation and filing in line with The Income Tax (Transfer Pricing) Regulation No. 01, 2012.
  4. Accounting software installation, customization and training
  5. Executive job placement.

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

Group TPP:

Contains policies that are applicable throughout the group irrespective of jurisdiction of operation and is usually Head office based.

Local TPP:

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:

  1. It is a document that is put in place long before any controlled        transaction actually takes place;
  2. TP  policy  documents  are  fairly permanent in nature; they do not change often.
  3. It provides a future view of likely inter-company transfers;
  4. TP  policy  explains  how  all  such controlled transactions shall be priced  by  connected  persons  (if and when they occur).
Contents of TP Policy

A typical TP Policy shall contain:A typical TP Policy shall contain:

  1. Name of members of the group and organisational structure;
  2. Ownership  or  control  linkages  of connected entities;
  3. Outline or a brief description of the business activities of the group       and its members;
  4. Type of inter-company transactions that may occur;
  5. The  flow  or  anticipated  flow  of controlled transactions;
  6. TP Method that may be adopted for the pricing for each type of      controlled transactions; and
  7. List   of   comparables   that   the company may use.



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:

  1. A company or entity in which the reporting company or entity has  50% or more ownership or control;
  2. An individual, company or entity that directly or indirectly owns or controls 50% or more of the reporting company or entity;
  3. A company or entity who is a member of the group of which the reporting company or entity is a member;
  4. Companies in which the same person has control, or a person has control of one and another person connected with him or her has control of the other;

How should Transfer Pricing Returns be filed?

Taxpayers are advised to take the following steps to properly file their TP returns:

  1. Obtain   the   TP   Declaration or Disclosure Form for free;
  2. Complete the forms appropriately, clearly and correctly;
  3. The forms should be printed and signed by the relevant officers;
  4. Make a copy of the audited financial statements (in detailed format);
  5. Make a copy of the income tax self-assessment;
  6. Make a copy of the income tax computation and all relevant schedules;
  7. Write a covering letter for the TP returns;
  8. Package  all  documents into  an envelope or appropriate packaging; i) Label the envelop or package “TP RETURNS”; and
  9. Deliver package with covering letter to the tax office at the same time that the company is filing its income tax returns

TP Documentation

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

  1. Information about the associated enterprises (with whom transactions were carried out);
  2. The nature of the controlled transaction (giving detail description, volume, value);
  3. Transfer pricing method adopted showing reasons why the method was considered most appropriate;

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.