Financial Q&A: Your Questions Answered
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Financial and Tax Compliance
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How do I prepare for tax audits?
In 2026, the Nigeria Revenue Service (NRS) uses a "Digital-First" audit approach. This means they often start with a Desk Examination—where they use AI to compare your bank account activity (reported quarterly by banks) against your tax filings—before ever visiting your office.
What payroll records must I maintain?
In 2026, payroll compliance is a high-priority area for the Nigeria Revenue Service (NRS) and State Internal Revenue Services (like LIRS). Under the Nigeria Tax Administration Act (NTAA) 2025, manual spreadsheets are now considered "high-risk," and you are required to maintain digital-first records for a minimum of 6 years.
How do I account for foreign currency transactions?
In 2026, the Nigeria Tax Act (NTA) 2025 has introduced strict rules for foreign currency transactions to prevent "tax leakage" through exchange rate manipulation. While you follow IAS 21 for your accounting books, the tax authorities require specific adjustments for your tax returns. Here is the 2026 framework for handling foreign currency in your business:
Who can audit my accounts?
In 2026, the question of "who" can audit your accounts is strictly regulated to ensure the integrity of the financial system. Not every accountant is an auditor, and using the wrong person can lead to your filings being rejected by the CAC or the NRS. To legally audit a company in Nigeria, a person or firm must meet these three non-negotiable criteria:
Do my accounts need to be audited?
In 2026, the short answer is: It depends on your turnover. Under the Nigeria Tax Act 2025 and CAMA 2020, most small businesses are now officially exempt from the expensive requirement of a professional external audit.