Dynamics of Accounting Theory and Practice: Accounting Issues of Loan Loss Provisioning and Measurements of Financial Instruments of Nigeria Qouted Banks

This research examines the changes in theory and practice of loan loss provisioning (LLPs) under IFRS and CBN prudential guideline and banks classification and measurement of financial instruments in the balance sheet by listed Deposit Money Banks (DMBs) in Nigeria. Data were drawn for a period of six years (2010-2015) post –IFRS. The data were analyzed using simple percentages, graph and tables to empirically investigate the difference between the IFRS and CBN provisioning models. Banks were grouped into two, the too-big-to- fail banks and smaller- banks. The findings, i observed that both groups adopt mixed attribute accounting (MAA) model in classifying and measuring financial securities and that the dynamic forward looking LLPs that will replace IAS 39 is a right decision by standard setters. Analysis of the data showed a clear stand of IASB and CBN, while the former emphasize on transparency the later is interested on stability of the financial industry. The study recommended that accounting principles and rules should be harmonized to reduce diversities of professional judgment and discretion in financial reporting. There should be synergy between the regulators and accounting standard setters (CBN and IASB). The stability of the financial system and providing faithful and relevant information to investors and other segments of the society should be a paramount objective of the two bodies and preparers of financial statements.