ICANFinancial AccountingRegulatory Framework and Conceptual Framework2025

Goldleaf Nigeria Plc prepares financial statements for the year ended 31 December 2023. Total assets are ₦850,000,000, revenue is ₦1,200,000,000, and profit before tax is ₦95,000,000. Under Section 394 of CAMA 2020, which category does Goldleaf Nigeria Plc fall into, and what audit requirement applies?

ALarge company; statutory audit by an external auditor registered with ICAN or ANAN is mandatoryCORRECT
BMedium company; a review engagement rather than a full audit is sufficient
CSmall company; exempt from statutory audit provided shareholders unanimously agree
DMicro company; only management accounts filed with the CAC are required
AI
Toaster Teacher
Why the answer is A, and why the others tempt you.
Under CAMA 2020, a company is classified as large if it exceeds at least two of three thresholds: turnover above ₦120 million, total assets above ₦60 million, or more than 20 employees. Goldleaf Nigeria Plc far exceeds both the turnover and total assets thresholds, making it a large company subject to mandatory statutory audit. Small companies meeting the exemption criteria under CAMA 2020 may be audit-exempt, but that exemption does not apply here.
Want this in Pidgin, Yoruba, Igbo or Hausa? Sign up free →

Practice more Financial Accounting questions

ICAN Financial Accounting has thousands more questions like this — with Worked answers on every one.

Start practicing free →See all Financial Accounting questions