Advertising agencies have been advised to take cognisance of events in the economy and comply with all regulatory and tax policies in order to survive the tough business environment in the country.
These views were expressed by speakers at the 2020 Business Outlook Seminar of the Association of Advertising Agencies of Nigeria (AAAN), which was held yesterday in Lagos. The theme of the seminar was “Nigerian Business Environment in the year 2020: Implication for Advertising Agencies.”
Delivering the keynote address, the Partner and Head of Andersen Tax LP, Mr. Emeka Onwuka, explained that the Nigerian economy was projected to grow by 2.4 per cent in 2020. Onwuka attributed the anticipated economic growth to the early passage of the 2020 budget, the enactment of the 2019 Finance Act, stability of oil price in the international market and the growth of the non-oil revenue sectors among others.
He, however, stated that government must be interested in helping businesses to thrive. He also advised economic actors to avoid decisions that would affect them and the economy negatively.
“Government plays a central role in the life of businesses. I always joke that government is an executive holder in every business in Nigeria. So, government should be interested in how businesses thrive because it is when businesses thrive that government should thrive,” he said.
Onwuka also warned advertising agencies to be tax compliant and ensure that they keep adequate records of their financial transactions in order to avoid the wrath of the tax regulatory agencies.
“The tax law by its nature is dynamic because government is supposed to tax businesses as businesses earn every day. So, it is best practice to update your taxes as the businesses change. One good thing about the change of taxes in the new Finance Act is that government didn’t impose it on us. It was actually done in consultation with the private sector.
“So, the first thing that every business must do is to have a plan to become compliant. Have your own tax strategy and finance strategy because tax does not exist in isolation. Tax follows accounting. You must treat tax matters extremely carefully because even if there is a dispute, whoever is mediating would have to see the facts sooner or later,” he said.
The Publisher and Chief Executive Officer of BusinessDay, Mr. Frank Aigbogun, stated that there were positives signs from the Nigerian economy, particularly with the recently released figures that showed that the economy grew by 2.27 per cent.
Aigbogun told the agencies to monitor important changes in the market and be able to proffer solid advice to their clients based on their knowledge of the market.
On his part, the Executive Director of First City Monument Bank, Mr. Olu Akanmu, pointed out that advertising agencies were no longer getting expansive briefs as their clients are suffering the low purchasing power of Nigerian consumers.
Akanmu said that advertising agencies should reinvent their operations by setting up autonomous digital platforms and targeting clients who are not the high-end corporate businesses.
Earlier in his welcome address, the President of AAAN, Mr. Ikechi Odigbo, said the seminar was pertinent as it would help all practicing advertising agencies to better understand the business environment and gain tips on how to plan pragmatically for the 2020 financial year.