Effects of IFRS adoption on the financial statements of Nigerian listed entities: the case of oil and gas companies

On 28 July 2010, the Nigerian Federal Executive Council approved January 1, 2012 as the effective date for the convergence of Nigerian Statement of Accounting Standards (SAS) or Nigerian GAAP (NG-GAAP) with International Financial Reporting Standards (IFRS). By this pronouncement, all publicly listed companies and significant public interest entities in Nigeria were statutorily required to issue IFRS based financial statements for the year ended December, 2012. This study investigates the impact of the adoption of IFRS on the financial statements of Nigerian listed Oil and Gas entities using six years of data which covers three years before and three years after IFRS adoption in Nigeria and other African countries. First, the study evaluates the impact of IFRS adoption on the Exploration and Evaluation (E&E) expenditures of listed Oil and Gas companies. Second, it examines the impact of IFRS adoption on the provision for decommissioning of Oil and Gas installations and environmental rehabilitation expenditures. Third, the study analyses the impact of the adoption of IFRS on the average daily Crude Oil production cost per Barrel. Fourth, it examines the extent to which the adoption and implementation of IFRS affects the Key Performance Indicators (KPIs) of listed Oil and Gas companies. The study further explores the impact of IFRS adoption on the contractual relationships between Nigerian Government and Oil and Gas companies in terms of Joint Ventures (JVs) and Production Sharing Contracts (PSCs) as it relates to taxes, royalties, bonuses and Profit Oil Split. A Paired Samples t-test, Wilcoxon Signed Rank test and Gray’s (Gray, 1980) Index of Conservatism analyses were conducted simultaneously where the accounting numbers, financial ratios and industry specific performance measures of GAAP and IFRS were computed and analysed and the significance of the differences of the mean, median and Conservatism Index values were compared before and after IFRS adoption. Questionnaires were then administered to the key stakeholders in the adoption and implementation of IFRS and the responses collated and analysed. The results of the analyses reveal that most of the accounting numbers, financial ratios and industry specific performance measures examined changed significantly as a result of the transition from GAAP to IFRS. The E&E expenditures and the mean cost of Crude Oil production per barrel of Oil and Gas companies increased significantly. The GAAP values of inventories, GPM, ROA, Equity and TA were also significantly different from the IFRS values. However, the differences in the provision for decommissioning expenditures were not statistically significant. Gray’s (Gray, 1980) Conservatism Index shows that Oil and Gas companies were more conservative under GAAP when compared to the IFRS regime. The Questionnaire analyses reveal that IFRS based financial statements are of higher quality, easier to prepare and present to management and easier to compare among competitors across the Oil and Gas sector but slightly more difficult to audit compared to GAAP based financial statements. To my knowledge, this is the first empirical research to investigate the impact of IFRS adoption on the financial statements of listed Oil and Gas companies. The study will therefore make an enormous contribution to academic literature and body of knowledge and void the existing knowledge gap regarding the impact and implications of IFRS adoption on the financial statements of Oil and Gas companies.

Investigating the role of glutathione and glutathione biosynthetic genes in the adaptation of Anopheles gambiae to insecticides

Malaria remains a serious public health challenge in the tropical world, with 584,000 deaths globally in 2013, of which 90% occurred in Africa, and mostly in pregnant women and children under the age of five. Anopheles gambiae (An. gambiae) is the principal malaria vector in Africa, where vector control measures involve the use of insecticides in the forms of long-lasting insecticide-treated nets (LLINs) and indoor residual spraying (IRS). The development of insecticides resistance mitigates these approaches. Glutathione (GSH) is widely distributed among all living organisms, and is associated with detoxification pathways, especially the Glutathione S-transferases (GSTs). Its direct involvement and relevance in insecticide resistance in An. gambiae has not been determined. Thus, this work examines the contribution of GSH, its biosynthetic genes (GCLM, GCLC) and their possible transcriptional regulator Nrf2 in insecticide resistance in An. gambiae sampled from agricultural setting (areas of intensive agriculture) and residential setting (domestic area). Bioinformatics analysis, W.H.O. adult susceptibility bioassays and molecular techniques were employed to investigate. Total RNA was first isolated from the adults An. gambiae mosquitoes raised from agricultural and residential field-caught larvae which had been either challenged or unchallenged with insecticides. Semi-quantitative RT-PCR using gel image densitometry was used to determine the expression levels of GCLM, GCLC genes and Nrf2. Bioinformatics’ results established the presence of putative AGAP010259 (AhR) and AGAP005300 (Nf2e1) transcription factor binding sites in An. gambiae GCLC and GCLM promoters in silico. An. gambiae s.l. studied here were highly resistant to DDT and permethrin but less resistant to bendiocarb. Both knockdown resistance (kdr) mutation variants L1014S and L1014F that confers resistance to pyrethroid insecticides were identified in both An. coluzzii and An. arabiensis sampled from northern Nigeria. The L1014F was much associated with An. coluzzii. A significant positive correlation (P=0.04) between the frequency of the L1014F point mutation and resistance to DDT and permethrin was observed. However, a weak or non-significant correlation (P=0.772) between the frequency of the L1014S point mutation and resistance was also found. L1014S and L1014F mutations co-occurred in both agricultural and residential settings with high frequencies. However, the frequencies of the two mutations were greater in the agricultural settings than in the residential settings. The levels of total, reduced and oxidized GSH were significantly higher in mosquitoes from agricultural sites than those from residential sites. Increased oxidized GSH levels appears to correlate with higher DDT resistance. The expression levels of GCLM, GCLC and Nrf2 were also significantly up-regulated in adults An. gambiae raised from agricultural and residential field-caught larvae when challenged with insecticide. However, there was higher constitutive expression of GCLM, GCLC and Nrf2 in mosquitoes from agricultural setting. The increased expression levels of these genes and also GSH levels in this population suggest their roles in the response and adaptation of An. gambiae to insecticide challenges. There exists the feasibility of using GSH status in An. gambiae to monitor adaptation and resistance to insecticides.