AN EXPLORATORY STUDY ON PROSPECTS AND CHALLENGES OF XBRL ADOPTION IN NIGERIA

Abstract

The information technology revolution has profound implications on financial reporting, financial information preparers and users. Today, speed, quality, accuracy and transparency are components for timely and useful corporate reports. This study explores the concepts, potential benefits and challenges of implementing eXtensible Business Reporting Language (XBRL) in Nigeria. The study uses both primary data and secondary data sources towards achieving its stated objectives. It reviews, existing literature in the context of developing countries, to analyze the prospects of XBRL adoption in Nigeria. Whereas interviews were conducted with stakeholders relevant to the process of XBRL adoption in Nigeria. Also, the study reports XBRL adoption effort in Nigeria. Findings indicate that there is a lack of awareness about XBRL among key stakeholders, including professional accountants. It was also found that there are inter-stakeholders’ rivalry which hampered the formation of XBRL Provisional Nigerian Jurisdiction thus the drive for the implementation of XBRL requires greater cooperation and collaboration of the major stakeholders, including government regulators, professional accountancy organizations, public entities, technology experts, educators, investors and other users of financial reports. The study concludes that XBRL could benefit stakeholders across the supply chain in corporate reporting, and there were options to address the challenges. It recommends that the authorities should consider persuasion for voluntary regulatory compliance with XBRL reporting system by large entities rather than mandatory compliance. The initiative for the establishment of XBRL Nigeria Provisional Jurisdiction should be accelerated and sustained towards fast XBRL adoption in Nigeria.