How Accountancy Profession Will Help Achieve Nigeria’s Digital Future
To the consumer, digital transformation might appear seamless: new services and products appear all the time, and with the push of a button we discover new levels of convenience and efficiency. But behind every success story is hard work, careful planning, and constant adaptation. Given the complexity of this transformation, at nearly every point in the journey, professional accountants can help Nigerian businesses achieve their financial goals and grow into market-leading positions.
A strong foundation for digital growth
Key components of a society-wide transformation are falling into place. Already about 104 million Nigerians access the internet and 33 million are active on social media, with WhatsApp, Facebook, YouTube and Instagram as the most used social media platforms.
As an increasing number of Nigerians join their peers online and connect via social media, higher expectations are likely to follow for digital services, such as e-commerce and high-speed internet access.
Democratisation of access to technology has already disrupted major industries and reshaped everyday decisions. For example, the widespread use of on-call vehicle drivers, such as Uber, has disrupted the traditional taxi industry in many countries. We are likely to see decentralisation in the financial sector, as well—with a direct connection to the accountancy profession.
Partnering for transformation
As an innovator in high-tech services, Nigeria has already made an international statement.In just the past year, Nigerian fintech start-up Paystack was acquired for $200 million, while another local fintech start-up Flutterwave announced it raised US$170 million. Continued innovation and growth are certain to come as Nigeria’s sizeable and vibrant younger generationsbring their skills and passions into the workforce.
Of course, the rest of the world is transforming as well—and the global pandemic has accelerated this trend. In a recent McKinsey survey, many corporate executives reported that their companies had responded to the pandemic by moving 20 to 25 times faster on digitalisation than they had thought was possible. Necessity has forced the pace of change, and enterprises of all sizes are adjusting to this new reality.
Most of Nigeria’s businesses are small- and medium-sized enterprises (SMEs). Like SMEs everywhere, they face a steep learning curve to manage their finances amid rapid digitalisation. For technology-based start-ups, assessing value is crucial to raising money and earning trust. Professional accountants are trained in assessing finances and making projections; they can help business owners to understand exactly how a firm might be struggling—for example, from a decline in in-person transactions and a rise in e-commerce—and to respond accordingly as an organisation.
As new digital-first SMEs form, they will have questions about getting started, including things as basic as applying for a business loan. Before long, entrepreneurs with non-finance backgrounds will find that the finance function is invaluable for understanding how a business is performing in real time, how it has performed in the past, and what to expect next.
Beyond the right set of technical skills, the accountancy profession also has an international Code of Ethics, with principles-based guidance for serving the public interest around the world. Professional accountants also have an exceptionally wide view and deep understanding of how organisations create long-term value. They are natural advisors for SMEs looking for candid, well-informed and professional counsel on financial management and corporate strategy.
Taking action to build a sustainable economy
Nigeria has the building blocks for continued growth and prosperity. The issue now is how Nigeria can ensure that its digital economy advances to its full potential over the long-term. The global digital economy is measured in trillions of dollars, and it will only grow. Every country will feel these effects and look for ways to compete and capitalise.
Digital transformation is not an isolated trend. We are in a long period of disruption and uncertainty with much at stake, including human health, the health of the planet and equality. Technology can bring better healthcare, more accessible education, wider job opportunities, and remarkable economic growth to meet these challenges. The key will be prioritising sustainability and fairness in the way Nigeria’s digital economy grows—and in how its benefits are felt.
Nigeria needs to build an economy that is capable of withstanding further crises, that creates sustainable jobs, develops relevant skills and rewards innovation while protecting the environment—the ultimate source of safety and livelihoods. The ongoing crises of COVID-19 and climate change require today’s decision makers to plan not just for months or years, but for decades. This is no easy task, and countries around the world are facing similar issues. Nigeria, as a country of SMEs and as a leader in digitalisation, can find the right advice and skills through partnership with the accountancy profession.
Processes and plans must be set today. Every organisation will need a strong strategy in placeas they ready themselves for digitalisation; everyone will be looking for trusted advisors. Professional accountants,who are fluent in finance and guided by an ethical duty to serve the public interest, are well qualified to support companies through these changes.
The talent pool in Nigeria is vast. Building a stronger, sustainable economy—based on creating strong manufacturing and service industries—will require the skills of its young and aspiring digital entrepreneurs.
. Johnson is the President, International Federation of Accountants (IFAC).