Accountancy as a professional and managerial function was imported into Nigeria just like any other white collar job by the British colonialists through their various commodities trading companies and supporting financial institutions. The Royal Niger Company and the Bank of British West Africa (now First Bank Plc) were at the forefront of introducing and developing modern accounting through the mentorship and regulation of the established accountancy practices in their motherland (the United Kingdom).
Prior to the advent of modern accounting, the traditional Africans were not known for large scale commercial activities as most communities live on subsistence agriculture. Except for the traditional aristocracy who kept large stock of farm produce and domestic animals which require one form of stewardship or the other, other individuals keep simple and straight forward records either by mental recognition or by the use of sticks and pebbles to keep record of their stocks. The Igbos have an indigenous writing system called insibidi which was basically used to keep household records of kings, oracles and chief priests with laid out succession plans with little reference to its use for the purpose of recording commercial transactions. Due to the incursion of the islamists from across the Sahara desert, the northern Nigerian Muslims inherited the Arabic language through faith training and have used it as a form of recording valuables, commercial transactions and computing tax payable by merchants and farmers to the emirs. It is not too clear, however, whether the Yorubas or Binis have a former method of recording commercial or financial transactions during the pre-colonial era.
When formal western education came into Nigeria via the missionaries and colonialists, formal and large scale commercial activities were ignited and this gave rise to the need to keep track of business and personal financial transactions via a formal accounting system. This was achieved gradually with the introduction of such tools as “reckoners” which act as traders’ calculators and cash or sales registers which act both as stock control book and sales control book. Accountancy became a formal profession when it became necessary that owners of a business must be divorced from the management of the firm.
Modern double entry accounting was discovered by Friar Luca Pacioli (1455-1517) and that discovery helped to improve firms’ managerial effectiveness as well as quicken the rapid growth of economies during the industrial revolution in Europe. The improvements in industrialization gave birth to the establishment of national accounting institutes all over Europe spilling over to the Americas. The fore runner to the accountancy profession in the former British colonies including Nigeria is the Institute of Chartered Accountants in England and Wales (ICAEW) which was established in 1880.
The practice of accounting in Nigeria became pronounced with the establishment of the first professional accounting association in the country established by a group of returnee ICAEW trained accountants headed by the Doyen of Accountancy and the first Chartered Accountant in Africa, Akintola Williams who qualified as ACA (ICAEW) in 1949. This body known as the Association of Accountants in Nigeria (AAN) which metamorphosed through an Act of Parliament (no 15 of 1965) into the first indigenous professional accounting body in Nigeria known today as the Institute of Chartered Accountants of Nigeria (ICAN). It was and is still charged with the responsibility of training and certifying professional accountants in Nigeria as well as issuing out guidelines on the practice of accounting in Nigeria. It now shares such responsibilities with the Association of National Accountants of Nigeria (ANAN) formed in 1979 but formerly recognized vide a government decree in 1993.
ICAN & ANAN
The two accounting bodies in Nigeria, ICAN and ANAN, are mostly divided on policy issues and matters relating to joint cooperation in the past unlike the cohesion existing between the 6 professional accounting bodies in the UK. However, the need to have ANAN under the umbrella of the International Federation of Accountants (IFAC), have ushered in some points of agreement which now made ICAN (a foundation member of IFAC) to agree to mentor and work together with ANAN on matters relating development, training and regulation of the accounting profession and its practice within the Nigerian federation. Despite the new found love, the level of cohesion between the two bodies is still weak while each body still prefers to hold on to its membership training, acquisition and certification style, with ICAN having overwhelming edge in membership and clientele.