A professor of Accounting at Babcock University, Prof. Ishola Akintoye has said that the current financial reporting system was inadequate to address the strategic earning of corporate and individual entities. This according to him is because sustainability accounting was yet to be incorporated in the current financial reporting.
Delivering the university’s 28th inaugural lecture, with the theme, ‘Accounting: A Mismanaged Concept Requiring Urgent Re-Definition’, Akintoye noted that the efficiency of sustainable accounting report would impact greatly on sustainable financial report.
The university don stated that the past conceptual framework for the definition of Accounting “cannot be adequate in driving accounting in the contemporary times and in the future.”
According to him, “If efforts are not made for an urgent redefinition of Accounting, the entire accounting building which is currently cracking will sink beyond redemption.”
Akintoye disclosed that he and a team of Accounting experts were developing a new Accounting Model named ‘Sustainability Accounting’ which goes beyond the current assumption of stability and growth, to bring in economic, environmental and social factors.
Furthermore, he said that the team of experts were leveraging on the Global Sustainability Index which had been developed for countries of the world to provide direction for government, private sectors and individuals as targets for all activities to be achieved in 2030.
According to Akintoye, the sustainable development targets were 17 and they include no poverty, zero hunger, good health and wellbeing, quality education, gender equality, clean water and sanitation, affordable and clean energy, decent work and economic growth, industry, innovation and infrastructure, reduced inequality, sustainable cities and communities. Others include responsible consumption and production, climate action, life below water, life on land, peace and justice, and strong institutions partnership all of which are required to achieve this goal.
He asserted that an efficient sustainable financial report would enhance decision-making of the total stakeholders and guarantee the going concern of the business as well as the society in general.
The university don therefore recommended that the federal Ministry of Education and the National Universities Commission must include in the Accounting Curriculum at every level of education, the subject of strategic accounting and sustainability accounting; that the practice of Accounting must demonstrate and emphasise driving the future rather than short or medium term in the private and public sector of any economy if long term sustainability would be actualised; the need to include human and environmental assets in the venture capital in business commencement and in evaluation of the strength and weakness of a company; government in all countries should insist through their local regulatory agencies that environmental cost and human capital be revealed in the statement of financial position of all corporate entities for public consumption.