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Taxation For Nigerian Musicians…..A Simple Guide

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In this blogpost we are going to get specific and take you through how taxation affects musicians and how best to avoid/reduce taxes. Remember Tax Avoidance is not a crime but tax evasion is.

Musicians like every other businesses are designed to make profit. They earn revenue by selling records and making profit by deducting expenses from the revenue that they derive from the records sold. However, before they enjoy the profits that they earn they must pay taxes, which by law are mandatory. How they pay taxes can be in two ways depending on the legal form of the music career. The legal form can either be as a Business or as an individual. As a business the musician registers a company and transfers all his earnings  to the company (estate). For better illustration, we will use an artiste who’s real name is Nosa and stage name Djinee. Nosa can decide to transfer earnings from his recordings to a company named Djinee Ltd (after his stage name). On the other hand he can decide to get all his revenue in his name (Nosa) just like a Sole Trader would. Either form attracts different a tax treatment. Let us first explore the revenue and expense profile of a musician.

Revenue and Expenditure of a Musician

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Musicians earn revenue from royalties, album sales, stage and tour performances, signature bonuses, endorsements etc. They can also earn revenue from other sources such as selling branded products and services. For example, selling fashion items in their names, owning a recording studio and charging artiste for using it, owning a record label themselves, writing songs for others, producing songs for other artiste or even appearing in movies. All of this make up the income an artiste can receive.

Expenditures

Artiste like every other business must incur expenses before their records can be released and also incur promotion and selling expenses after they are released. They also pay lawyers, accountants, managers, band (if they have one), rents, mortgage (not common in Nigeria), tour expenses, and off course maintain a lifestyle. These are expenses that they incur regularly. However, not all of these expenses qualify for tax exemptions. Meaning the tax man does not recognize them all as expenses which must be deducted before tax is paid. And as such expenses that are not recognized will be taxed, which in effect may increase the amount of tax a musician gets to pay.

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With this in mind we can now explore how each of these expenses affect Djinee as he decides whether his revenue will accrue to Nosa or to Djinee Ltd. If he represents himself then he falls under the Personal Income Tax Bracket. If he falls under Djinee Ltd then he falls under the Corporate Income Tax bracket. Take note of these two as they each have their unique tax implication.

Revenue

Revenue as Nosa – In Nigeria, an individual is liable to pay tax on income derived from Nigeria and globally. Meaning if Nosa earns income from playing in South Africa he is also liable to pay tax from the income derived from there. The tax is paid to the state the musician resides in. For example, if he lives in Lagos then he must pay that tax to the Lagos State Government.

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GTBank 728 x 90

Revenue as Djinee Ltd – Djinee Ltd is a company and as such all revenues derived in Nigeria and abroad is subject to corporate income taxation. As the owner of the Djinee Ltd he will earn dividends from the profit after tax from his business. That dividend will be subject to 10% withholding tax and will be the final tax that he pays. Remember, the dividend is paid to him as Nosa not as Djinee Ltd. For example, Djinee Ltd earned a profit before tax of N10m in the year. He is then taxed 30% of the profit giving him a profit after tax of N7m. Djinee Ltd then decides to pay all of its N7m to Nosa who owns 99% of the company (A company by law must be owned by 2 people) that is N6,930,00. Before paying the N6.93m Djinee Ltd must deduct 10% that is  N693,000, bringing the net amount paid to Nosa Ltd to N6,237,000. That amount will be taxed again in the hands of Nosa as a personal income. Now if Nosa also decides to earn a salary as the owner he will be further subjected to (Pay As you Earn) PAYE. The same tax employees pay.

Djinee Ltd is also expected to remit Value Added Tax on behalf of the Government for the services rendered, in this case singing.  Meaning, whenever he serves his bill to show organizers or sells tickets for shows he organizes he must include a VAT of 5% to the bill/ticket and remit such to the FIRS. VAT is applicable to both Djinee and Nosa.

Expenses

The major difference between the two entities is how expenses are treated. The Inland Revenue has clearly spelled out a list of expenses that can be deducted from revenue before tax can be charged. So, the more expenses that get deducted the less tax you are likely to pay. Since there are numerous expenses musicians incur we will single out the ones that we feel are most common. As Nosa, his tax status falls under Pay As you Earn (PAYE) or Direct Assessment. Direct Assessment is a form of personal income tax that self employed people pay. PAYE is easy to calculate and quite straight forward. However, taxing individuals such as sole traders, businesses registered with a business name or even a partnership can be quite tricky. To address that for example, the Lagos State Government came up with a schedule detailing different taxes that apply to different earning. So, we will concentrate on companies and individuals such as sole traders (excluding employees).

Recording and Studio Cost

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Recording and Studio cost are cost such as production, sound engineering, editing, mixing, mastering etc. For Djinee Ltd, these costs can be deducted from revenue before paying tax. For Nosa as a businessman, the expense will equally be deductible before tax is paid. However, it is important to note that if the studio is located in a private apartment that he owns, the tax authority may not view it as a legitimate expense meant for business. It might be seen as a hobby and not necessarily a true business cost. So artiste should be careful how they designate the destination of their studio.

Rent of Studio

Musicians also rent studios whenever they want to record music. That expense is also allowable for tax purposes as it is seen as a proper expense (incurred during the ordinary course of business). It also applies to Djinee Ltd and to Nosa (our working examples). However, as indicated above, if the Studio is in a private residence, it may not qualify as a true expense. Meaning, if the studio is located in the private residence of Don Jazzy and is also used for pleasure, the tax authority may on technical grounds dismiss this as an expense. So be careful where you record your music.

Professional/Consultancy Fees

There is hardly any musician who does not have a Manager. Managers, Lawyers, Accountants, Make Up Artiste etc all provide professional services for the artiste for a fee. These fees are also deductible before arriving at the tax payable. These apply to businesses and individuals as well. Remember, when paying consultants the fees you must deduct a 10% withholding tax (WHT) from their invoice. If Djinee Ltd deducts the WHT, they remit them to the Federal Inland Revenue Service. If it’s Nosa making the deductions, he remits them to the State Inland Revenue Service where he resides, in this case Lagos State. Musicians must obtain receipts for these payments otherwise the tax authorities will not consider it as an expense. It is usual for providers of these services to collect money without issuing receipts. But that is not an excuse in the eye of the law. Also note that if the artiste fails to deduct withholding tax, the artiste (Djinee Ltd/Nosa in this case) will be liable to that too.

 Equipment Cost

Musicians can either buy or rent equipment, which are used to record their music and/or play on tours. If the equipment is rented, then the rental payments are seen as an expense and as such are deductible for tax purposes. This also applies to Djinee Ltd and Nosa. However, it is a different treatment if the equipment’s are bought and owned by the Djinee Ltd/Nosa. Usually, asset cost (which include musical equipment) is depreciated over the life of the asset. For example, if a set of drums cost N500k and it is expected to have a useful life of 5 years, then each year a sum of N100k (N500k/5) will be written of as expense for the asset. Unfortunately, whilst the business recognizes this as a cost, the revenue service does not. Rather they employ a different method called Capital Allowance, in determining how that cost is accounted for. Capital Allowances when calculated will be relieved against the taxable profit of the business. Capital Allowances apply to both companies and sole proprietorship.

 Media, Publicity and Marketing

Musicians also spend money on media and publicity. Media and publicity involves payment for radio ads, tv ads, marketing, adverts, telephone cost, photography, photo shoots etc. These are all allowable expenses and are tax deductible for both individuals and companies. As mentioned, efforts should be made to keep receipts for payments.

Interest on Loans

Just like any other business, musicians can obtain loans from businesses to pay for recording, marketing and promotion of their music. The interests on those loans are also tax deductible and equally apply to individuals (Nosa) and Companies (Djinee Ltd). Suffice to add that for individuals like Nosa, they can also deduct interest on loans that was used to pay for owner-occupier houses. An Owner Occupier House is a house occupied by the owner and financed by a mortgage institution.  This does not apply to corporates like Djinee Ltd.

 Other Issues of note

Itinerant Worker

Itinerant workers are those whose works often have to be carried out in different locations in Nigeria for a minimum of 20days in at least three years of any assessment year. For example, assuming Nosa is invited to perform a series of shows for Globacom in the South East for a period of three months. He gets to perform in all the major towns in Imo State for 25days, Enugu for another 21 days and Anambra for a month. In this instance, Nosa will be liable to pay tax on income earned to the state Internal Revenue Services of Imo, Enugu and Anambra States respectively.

Losses

Musicians can also incur losses during the course of the financial year. Meaning if a musician should incur a loss due to poor record sales and lack of endorsements, poor ticket sales for shows he will only be made to pay minimum tax. For example Nosa spends N5m to push out and album and spends another N2m promoting it. He then earns total revenue for the year of N6m from record sales, endorsements etc. giving him a loss of N1m. He will only pay minimum tax that year. If by the next year album sales pick up and he makes a profit of N1m, he will still not pay tax as the N1m losses he got in the year before will be relieved against the N1m profit he earned in the current year.

What about Cost of Expensive Fashion items, Cars, Bikes Etc?

Musicians also spend a lot of money maintaining a luxurious lifestyle. It’s an essential ingredient in the whole presentation and persona of an artiste. It helps them with brand recognition and helps attract a very large fan base. So they end up buying expensive cars, watches, clothes, shoes, spend large sums of money in clubs and organizing parties etc. Even their “cribs” are well furnished to give a very stylish and tasteful appearance after all this is what makes them who they are. An artiste is revered not only by how talented he is but also by his appearance, “swag”, and strong persona. All of this point to earning him more money. Whilst all this hold true it might not qualify for tax deductions as the tax authorities view it as personal cost rather than cost reasonably incurred for the business. Think about it, how do you determine exactly how the cost of a shoe helps Nosa earn a kobo of revenue? An escape route might however be the ability to include some of those cost as costume cost. After all an artiste needs to buy costume whenever he is going on stage. Cars can also be included as part of the asset of the business provided it is not specifically designated to Nosa. Meaning it is a pool car. If these can be proven without reasonable doubt then these cost may perhaps be deductible before tax is computed.

Finally

Taxation is an integral part of our everyday business life and as such must be taken seriously. As musicians announce juicy contracts and flash expensive jewelry in parties and shows they should remember the taxman is on the sidelines watching. Very soon the Lagos State Government (especially) will start throwing their searchlights more aggressively on them. So, musicians must ensure that they have good accountants that can help with their taxes. Accountants are equally as important as Managers and lawyers. You can learn more on how to avoid taxes in the Tutorial section of my blog

Updated 16/7/2012. See earlier version below

……………………………………………………………………………………………………………….

I have blogged severally about taxation as it affects individuals and companies. However, in this blogpost we are going to get specific and take you through how taxation affects musicians and how best to avoid taxes. Remember Tax Avoidance is not a crime bu tax evasion is.

Musicians like every other businessmen are designed to make profit. They earn revenue by selling records and making profit by deducting expenses from the revenue that they earn. However, before they enjoy the profits that they earn they must pay taxes which by law are mandatory. How they pay taxes can be in two ways depending on the legal form of the music career. The legal form can either be as a Business or as an individual. As a business the musician registers a company and transfers all earnings he earns to the company (estate) that he incorporates. For example, using an artiste who’s real name is Nosa can decide to transfer earnings from his recordings to a company named Djinee Ltd (after his stage name). On the other hand he can can decide to get all his revenue in his name (Nosa) just like a Sole Trader would. Either form attracts different tax treatment. Let us first explore the revenue and expense profile of a musician.

Revenue and Expenditure of a Musician

Musicians earns revenue from royalties from album sales, stage and tour performances, signature bonuses, endorsements etc. They can also earn revenue from other sources such as branding products and services and selling them. For example, selling fashion items in their names, owning a recording studio and charging artiste for using it, owning a record label themselves, writing songs for others, producing songs for other artiste or even appearing in movies. All of this form income for the artiste.

Expenditures

Artiste like every other business must incur expenses before their records can be released and also incur expenses in promotion and selling of the records after they are released. They also pay lawyers, accountants, managers, band (if they have one), rents, mortgage (not common in Nigeria), tour expenses, and offcourse maintain a lifestyle. All of these are expenses that they incur regularly. However, not all of these expenses qualify for tax exemptions. Meaning the tax man does not recognize them all as expenses which must be deducted before tax is paid. And as such expenses that are not recognized will be tax which in effect may increase the amount of tax a musician gets to pay.

With this in mind we can now explore how each of these expenses affect Djinee if he decides his revenue will accrue to Nosa or to Djinee Ltd. If he is represented by himself then he falls under the Personal Income Tax Bracket. If he falls under Djinee Ltd then he falls under the Corporate Income Tax bracket. Now note this two as they each have their unique tax implication.

Revenue

Revenue as Nosa – In Nigeria, an individual is liable to pay tax on income derived from Nigeria and globally. Meaning if Nosa earns income from playing in South Africa he is aso liable to pay tax from the income derived from there. The tax is paid to the state the musician resided in. For example, if he lives in Lagos then he must pay that tax to the Lagos State Government.

Revenue as Djinee Ltd – Djinee Ltd is a company and as such all revenues derived in Nigeria and abroad is subject to corporate income taxation. As the owner of the Djinee Ltd he will earn dividends from the profit after tax from his business. That dividend will be subject to 10% withholding tax and will be the final tax that he pays. Remember, the dividend is paid to him as Nosa not as Djinee Ltd. For example, Djinee Ltd earned a profit of N10m in the year. He is then taxed 30% of the profit giving him a profit after tax of N7m. Djinee Ltd then decides to pay all of its N7m to Nosa who owns 99% of the company (A company by law must be owned by 2 people) that is N6,930,00. Before paying the N6.93m Djinee Ltd must deduct 10% from the amount, N693,000, bringing the net amount paid to Nosa Ltd to N6,237,000. That amount will be taxed again in the hands of Nosa as a personal income. Now if Nosa also decides to earn a salary as the owner he will be further subjected to (Pay As you Earn) PAYE. The same tax employees pay.

Expenses

The major difference between the two entities is how expenses are treated. The Inland Revenue has clearly spelled out list of expenses that can be deducted from revenue before tax can be charged. So, the more expenses that get deducted the less tax you are likely to pay. Since there are numerous expenses musicians incur everyday we will single out the ones that we feel are most common. As Nosa, his tax status falls under Pay As you Earn (PAYE) or Direct Assessment. Direct Assessment is a form of personal income tax that self employed people pay. PAYE is easy to calculate and quite straight forward as can be seen here. However, taxing individuals such as sole traders, businesses registered with a business name or even a partnership can be quite tricky. To address that for example, the Lagos State Government came up with a schedule detailing different taxes that apply to different earning. So, we will concentrate on companies and individuals such as sole traders (excluding employees)

Recording and Studio Cost

Recording ans Studio cost are cost such as production, sound engineering, editing, mixing, mastering etc. For Djinee Ltd, this cost will be deducted from revenue before paying tax. For Nosa as a businessman, the expense will equally be deductible before tax is paid. However, it is important to note that if the studio is located in a private apartment that he owns, the tax authority may not view it as a legitimate expense meant for business. It might be seen as a hobby and not necessarily a true business cost. So artiste should be careful how they designate the destination of their studio.

Rent of Studio

Musicians also rent studio’s whenever they want to record music. That expense is also allowable for tax purposes as it is seen as a proper expense. It also applies to Djinee Ltd and to Nosa (our working example). However, as indicated above, if the Studio is in a private residence, it may not qualify as a true expense. Meaning, if the studio is located in the private residence of Don Jazzy and is also used for pleasure, the tax authority may on technical grounds dismiss this as an expense. So be careful where you record your music.

Professional/Consultancy Fees

There is hardly any musician who does not have a manager. Managers, Lawyers, Accountants, Make Up Artiste etc all provide professional services for the artiste for a fee. These fees are also deductible before arriving at the tax payable. This applies to businesses and individuals as well. Remember, when paying consultants the fees you must deduct a 10% withholding tax (WHT) from their invoices. If Djinee Ltd deducts the WHT, they remit them to the Federal Inland Revenue Service. If it’s Nosa making the deductions, he remits them to the State Inland Revenue Service where he resides, in this case Lagos State. Musicians must obtain receipts for these payments otherwise the tax authorities will not consider it as an expense. It is usual for providers of this services to collect money without issuing receipts. Also note that if the artiste fail to deduct witholding tax Djinee Ltd/Nosa will be liable to that too.

Equipment Cost

Musicians can either buy or rent equipments which are used to record their music and/or play on tours. If the equipment is rented, then that cost is deductible for tax purposes. This also applies to Djinee Ltd and Nosa. However, it is a different treatment if the equipments are bought and owned by the Djinee Ltd/Nosa. Usually, asset cost (which musical equipments are) are depreciated over the life of the asset. For example, if a set of drums cost N500k and it is expected to have a useful life of 5 years, then each year a sum of N100k (N500k/5) will be written of as expense for the asset. Unfortunately, whilst the business recognizes this as a cost, the revenue service does not. Rather they employ a different method called Capital Allowance, in determining how that cost is accounted for. Capital Allowances when calculated will be relieved against the taxable profit  of the business. Capital Allowances apply to both companies and sole proprietorship.

Media, Publicity and Marketing

Musicians also spend money on media and publicity. Media and publicity involves payment for radio ads, tv ads, marketing, adverts, telephone cost, photography ,photo shoots etc. These are all allowable expenses and are tax deductible for both individuals and companies. As mentioned, efforts should be made to keep receipts for payments.

Interest on Loans

Just like any other business, musicians can obtain loans from businesses to pay for recording, marketing and promotion of their music. The interest on those loans are also tax deductible and equally applies to individuals (Nosa) and Companies (Djinee Ltd). Suffice to add that for individuals like Nosa, they can also deduct interest on loans that was used to pay for owner occupier houses. This does not apply to corporates like Djinee Ltd.

Other Issues of note

Itinerant Worker

Itinerant workers are those who’s work often have to be carried out in different location in Nigeria for a minimum of 20days in at least three years of any assessment year. For example, assuming Nosa is invited to perform a series of shows for Globacom in the South East for a period of three months. He gets to perform in all the major towns in Imo State for 25days, Enugu for another 21 days and Anambra for a month. In this instance, Nosa will be liable to pay tax on income earned to the state Internal Revenue Services of Imo, Enugu and Anambra States respectively.

Losses

Musicians can also incur losses during the course of the financial year. Meaning if a musician should incur a loss due to poor record sales and lack of endorsements, poor ticket sales for shows he will only be made to pay minimum tax. For example Nosa spends N5m to push out and album and spends another N2m promoting it. He then earns a total revenue for the year of N6m fom record sales, endorsements etc. giving him a loss of N1m. He will only pay minimum tax that year. If the next year album sales pick up and he makes a profit of N1m, he will still not pay tax as the N1m losses he got in the year before will be relieved against the N1m profit he earned in the current year.

What about Cost of Expensive Fashion items, Cars, Bikes Etc?

Musicians also spend a lot of money maintaining a luxurious lifestyle. Its an essential ingredient in the whole presentability and persona of an artiste. It helps them with brand recognition and helps attract a very large fan base. So they end up buying expensive cars, watches, clothes, shoes, spend large sums of money in clubs and organizing parties etc. Even their “cribs” are well furnished to give a very stylish and tasteful appearance after all this is what makes them who they are. An artiste is revered not only by how talented he is but also by his appearance, “swag”, and strong persona. All of this point to earning him more money. Whilst all this hold true it might not qualify for tax deductions as the tax authorities view it as personal cost rather than cost reasonably incurred for the business. Think about it, how do you determine exactly how the cost of a shoe helps Nosa earn a kobo of revenue? Hard to determine. An escape route might however be the ability to include some of those cost as costume cost. After all an artiste needs to buy costume whenever he is going on stage. Cars can also be included as part of the asset of the business provided it is not specifically designated to Nosa. Meaning it is a pool car. If these can be proven without reasonable doubt then these cost may perhaps be deductible before tax is computed.

Finally

Taxation is an integral part of our everyday business life and as such must be taken seriously. As musicians annouce juicy contracts and flash expensive jewelry in parties and shows they should remember the tax man is on the sidelines watching. Very soon the Lagos State Government especially will start throwing their search lights more aggressively on them. Based on this, musicians must ensure that they have good accountants to help with their taxes. Accountants are equally as important as Managers and lawyers. You can learn more on how to avoid taxes in the Tutorial section of this blog

 

 

 

Patricia

Ugo Obi-chukwu "Ugodre" is a chartered accountant with over 16 years experience in financial management, corporate finance and financial analysis. He is also a retail investor and a personal finance advocate with over a decade experience investing in the Nigerian stock market. Ugo is the founder/Publisher of Nairametrics and blogs regularly on the website.

3 Comments

3 Comments

  1. Joseph

    March 15, 2015 at 1:12 am

    Hey there,
    Great post really found it enlightening.
    Have a few questions though.
    You said the withholding tax paid by Djinee ltd to Nosa is a final tax yet Nosa still pays income tax on it. Could you please explain why..is it because Djinnee Ltd is not a quoted company??
    As regards the issue of itinerant workers is he going to pay income tax to each of those states or on the income he derived there or simply to his principal place of residence

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Big 4 earn N 7.53 billion auditing Nigeria’s biggest companies

A ranking of which audit firms earned the most of 25 of the largest companies on the NSE.

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Big 4 earn N 7.53 billion auditing Nigeria’s biggest companies, PWC, KPMG, Deloitte

The four biggest audit firms in Nigeria PWC, KPMG, Deloitte, Ernst and Young earned a sum of N7.53 billion as audit fees from Nigeria’s most capitalized firms in 2019.     

The fees were earned by auditing 25 of the largest companies on the Nigerian stock exchange. According to data from Nairalytics, a research arm of Nairametrics, the four firms increased their revenue by 5% compared to N7.17 billion generated from the same companies in 2018. Nairalytics based its analysis on quoted companies as they are by law required to publish their annual reports. Private companies are not mandated to publish their annual reports in Nigeria.  

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Competition between the big 4 audit firms as they are classified intensified in the period under review as our research showed that PWC carted with the highest share having earned auditing some of the largest companies on the stock exchange. KPMG was a close second and is often thought to be the largest audit firm in the country by revenue when you add several other privately listed firms that they audit.  

However, in this analysis, we looked at figures contained in the audited accounts of the largest 25 companies on the stock exchange who make up over 80% of market capitalization.  The companies include, Access Bank, GT Bank, Dangote Sugar, Dangote Cement, Zenith Bank, UBA, Guinness Nigeria, NB Plc, Intl. Breweries, BUA Cement, NASCON, Dangote Sugar. Others include, Fidelity Bank, Total Plc, Flour Mills Plc, Transcorp, Seplat, Sterling Bank, FBNH, Stanbic IBTC, Union Bank, Custodian Investment, Nestle, Unilever and FCMB.

READ MORE: NNPC releases audited financial statements, refineries record losses of N154 billion

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PWC  

PWC grew its income from N3.39 billion in 2018 to N3.59 billion in 2019. Its earnings are diversified across banking, brewery, consumer goods and cement sectors. The banking sector contributed a significant 91.8% (N3.29 billion) of its total income, one of which includes GT bank, the most capitalized bank on the stock market. The audit firm received N791 million from the bank representing 23% of total revenue earned by the firm.  

PWC was on the books of MTN Nigeria in 2018, earning N271 million from auditing their accounts but has been replaced by another firm, Grant Thornton in 2019. However, it replaced that loss with a N389 million increase in income from banking between 2018 and 2019.  

Banking – 2018 N2.9 billion/ 2019 N3.2 billion.  

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Brewery – 2018 N98 million/2019 N98 million  

Cement – 2018 N39 million/2019 N114 million  

Consumer Goods – 2018 N71 million/2019 N80 million  

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Telecomm – 2018 N271 million/ 2019 Nil

Companies – Access Bank, FBNH, GT Bank, UBA, Guinness Nigeria, International Breweries, BUA Cement, Dangote Sugar, NASCON. 

READ ALSO: Some experts are uncertain of what to expect from money markets in H2 2020


KPMG  

The international audit firm grew its earnings by 5.5% from its 8 clients on our list from N2.37 billion received in 2018 to N2.51 billion in 2019. The banking sector remained a dominant source of revenue for the audit firms with about 76% of total revenue accrued. Zenith Bank paid KPMG about N892 million in audit fees in 2019 representing 35.6% of the audit firms’ earnings auditing top firms. Zenith Bank is also Nigeria’s most profitable bank. KPMG also audited a diversified list of quoted companies across the banking, cement, consumer goods and oil & gas sectors.  

Banking – 2018 N1.8 billion/ 2019 N1.88 billion.  

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Cement – 2018 N128 million/2019 N128 million  

Consumer Goods – 2018 N404 million/2019 N443 million  

Oil and Gas – 2018 N36 million/ 2019 N46 million  

Companies – FCMB, Stanbic IBTC, Union Bank, Zenith Bank, Lafarge, Flour Mills Plc, Unilever, Total Plc. 


EY  

Ernst and Young came third on our list with a total earning of N746 million in 2019 from five companies on our tracker list. The five companies include, Fidelity bank, Sterling bank, Custodian Investment, Transnational corporation and Seplat Petroleum.  

However, the firm’s earnings recorded a slight decline when compared to N752 billion recorded in 2018. This was due to the reduction in audit fees received from Seplat Petroleum. EY only has two banks on its list and this includes Fidelity and Sterling Bank both contributing a combined N414 million in earnings last year.     

Banking – 2018 N413 million/2019 N414 million  

Oil and Gas – 2018 N180 million/2019 N170 million  

Others – 2018 N159 million/2019 N162 million.  

Companies –Fidelity Bank, Sterling Bank, Seplat, Transcorp, Custodian Investment 


Deloitte  

The oldest indigenous accounting firm in Nigeria earned a total of N691.6 million in audit fees in 2019 compared to N660 million in 2018. Surprisingly, Deloitte does not have any of the major banks included in our list but works with Ahmed Zakaria to audit the accounts of one of the largest cement company in the country, Dangote Cement. Other companies on the list include, Presco, Nigerian Breweries, and Nestle Nigeria.  

Deloitte in Nigeria is a merger between Akintola Williams and Deloitte Global.  

 Agriculture – 2018 N29 million/2019 N31.6 million  

Brewery –2018 N57 million/2019 N61 million  

Cement – 2018 N539 million/2019 N561 million.  

Consumer Goods – 2018 N35 million/2019 N38 million  

Companies – Presco, NB, Dangote Cement, Nestle.  


A look at what happened in 2017  

A similar study carried out by Nairametrics in 2017 showed that the big 4 audit firms earned a sum of N6.4 billion as audit fees in 2016 with PWC scooping the most earnings of N2.5 billion followed by KPMG with N2 billion. Ernst and Young also earned about N1.1 billion in 2016 and Deloitte earned N530.2 million in audit fees 

Patricia
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Coronavirus

COVID-19 Update in Nigeria

On the 2nd of July 2020, 626 new confirmed cases and 13 deaths were recorded in Nigeria bringing the total confirmed cases recorded in the country to 27,110.

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The spread of novel Corona Virus Disease (COVID-19) in Nigeria touched a new milestone as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 27,110 confirmed cases.

On the 2nd of July 2020, 626 new confirmed cases and 13 deaths were recorded in Nigeria, having carried out a total daily test of 3,063 samples across the country.

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To date, 27110 cases have been confirmed, 10801 cases have been discharged and 616 deaths have been recorded in 35 states and the Federal Capital Territory. A total of 141,525 tests have been carried out as of July 2nd, 2020 compared to 138,462 tests a day earlier.

COVID-19 Case Updates- 2nd July 2020

  • Total Number of Cases – 27,110
  • Total Number Discharged – 10,801
  • Total Deaths – 616
  • Total Tests Carried out – 141,525

According to the NCDC, the 626 new cases were reported from 20 states- Lagos (193), FCT (85), Oyo (41), Edo (38), Kwara (34), Abia (31), Ogun (29), Ondo (28), Rivers (26), Osun (21), Akwa Ibom (18), Delta (18), Enugu (15), Kaduna (13), Plateau (11), Borno (8), Bauchi (7), Adamawa (5), Gombe (4), Sokoto (1).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 10,823, followed by Abuja (2,020), Oyo (1,432), Kano (1,257), Edo (1,203), Delta (1,149) Rivers (1,114), Ogun (898),  Kaduna (818), Katsina (578), Bauchi (512), Gombe (511), Borno (501), Ebonyi (438), Plateau (393), Ondo (353), Imo (352), Abia (351), Enugu (342), Jigawa (318).

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Kwara state has recorded 269 cases, Bayelsa (234), Nasarawa (213), Sokoto (152), Osun (148), Niger (116), Akwa Ibom (104), Adamawa (89), Kebbi (81), Zamfara (76), Anambra (73), Benue (65), Yobe (61), Ekiti (43), Taraba (19), while Kogi state has recorded 4 cases.

 

READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

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Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020.

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READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous

DateConfirmed caseNew casesTotal deathsNew deathsTotal recoveryActive casesCritical cases
July 2, 2020271106266161310801156937
July 1, 2020264847906031310152157297
June 30, 202025694561590179746153587
June 29, 20202513356657389402151587
June 28, 20202486749056579007149957
June 27, 20202407777955848625148947
June 26, 20202329868455458253144917
June 25, 20202261459454977822142437
June 24, 20202202064954297613138657
June 23, 20202137145253387338135007
June 22, 20202091967552577109132857
June 21, 202020242436518126879128477
June 20, 202019808661506196718125847
June 19, 202019147667487126581120797
June 18, 20201848074547566307116987
June 17, 202017735587469145967112997
June 16, 202017148490455315623110707
June 15, 20201665857342445349108857
June 14, 202016085403420135220104457
June 13, 20201568250140785101101747
June 12, 20201518162739912489198917
June 11, 2020145546813875449496737
June 10, 20201387340938217435191407
June 9, 2020134646633654420688937
June 8, 2020128013153617404084007
June 7, 20201248626035412395981737
June 6, 2020122333893429382680657
June 5, 20201184432833310369678157
June 4, 2020115163503238353576467
June 3, 2020111663483151332975227
June 2, 20201081924131415323972667
June 1, 20201057841629912312271579
May 31, 20201016230728714300768687
May 30, 2020985555327312285667267
May 29, 202093023872612269763447
May 28, 202089151822595259260647
May 27, 202087333892545250159787
May 26, 2020834427624916238557107
May 25, 202080682292337231155247
May 24, 202078393132265226353607
May 23, 202075262652210217451317
May 22, 2020726124522110200750337
May 21, 2020701633921111190748987
May 20, 202066772842008184046377
May 19, 202064012261921173444757
May 18, 202061752161919164443407
May 17, 202059593881826159441837
May 16, 202056211761765147239737
May 15, 202054452881713132039544
May 14, 202051621931683118038154
May 13, 202049711841646107037374
May 12, 20204787146158695936704
May 11, 202046412421521090235894
May 10, 202043992481421777834794
May 9, 202041512391271174532784
May 8, 202039123861181067931154
May 7, 20203526381108460128184
May 6, 20203145195104553425071
May 5, 2020295014899548123704
May 4, 2020280224594641722912
May 3, 2020255817088240020702
May 2, 20202388220861735119522
May 1, 20202170238691035117512
April 30, 2020193220459731715562
April 29, 2020172819652730713692
April 28, 2020153219545425512322
April 27, 20201337644102559942
April 26, 20201273914152399942
April 25, 20201182873632229252
April 24, 202010951143312088552
April 23, 20209811083231977532
April 22, 2020873912931976482
April 21, 20207821172631975602
April 20, 2020665382311884662
April 19, 2020627862221704362
April 18, 2020541482021663562
April 17, 2020493511841593172
April 16, 2020442351311522772
April 15, 2020407341211282672
April 14, 202037330111992632
April 13, 202034320100912422
April 12, 20203235100852282
April 11, 202031813103702382
April 10, 20203051770582402
April 9, 20202881471512302
April 8, 20202742260442262
April 7, 20202541661442042
April 6, 2020238650351982
April 5, 20202321851331942
April 4, 2020214540251850
April 3, 20202092542251800
April 2, 20201841020201620
April 1, 2020174352091630
March 31, 202013982091280
March 30, 2020131202181210
March 29, 2020111221031070
March 28, 20208919103850
March 27, 2020705103660
March 26, 20206514102620
March 25, 2020517102480
March 24, 2020444102410
March 23, 20204010112370
March 22, 2020308002280
March 21, 20202210001210
March 20, 2020124001110
March 19, 20208000170
March 18, 20208500170
March 17, 20203100030
March 16, 20202000020
March 15, 20202000020
March 14, 20202000020
March 13, 20202000020
March 12, 20202000020
March 11, 20202000020
March 10, 20202000020
March 9, 20202100020
March 8, 20201000010
March 7, 20201000010
March 6, 20201000010
March 5, 20201000010
March 4, 20201000010
March 3, 20201000010
March 2, 20201000010
March 1, 20201000010
February 29, 20201000010
February 28, 20201100010

Patricia
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Commodities

OPEC production output now at lowest level in nearly 30 years 

Production cuts from OPEC countries and other allies have helped to revive the price of Brent Crude.

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OPEC+ Alliance, US, Russia, Canada, Mexico reach historic deal to cut 13.4 million bpd, Oil market still uncertain over the OPEC+ deal as prices react positively, 7 oil producing countries most affected by covid-19, see where Nigeria is placed

The production output of the Organisation of Petroleum Exporting Countries (OPEC) member-countries has recorded its lowest level in nearly 30 yearsdue to production cuts after demand was heavily impacted by the COVID-19 pandemic. The last time oil production was cut to 22 million barrels a day was during the Gulf War in 1991. 

Last month, OPEC cut production to 22.69 million barrels per day, in an effort to strengthen global prices for the commodity which was struggling with weak demand during a global lockdown occasioned by the pandemic. 

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OPEC leader, Saudi Arabia, has been compliant in its production cuts through the month of June. Back home, Nigeria has promised to do its parts in implementing total compliance with the cuts. 

Production cuts from OPEC countries and other allies such as Russia (OPEC+) have helped to revive the price of Brent Crude to over $40 since May, compared to record lows in the month of April. 

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While the Gulf nations have implemented further cuts, Nigeria, Angola and Iraq are still lagging in full compliance, meeting only 77%, 83%, and 70% (respectively) of their quotas. Saudi Arabia reduced production by 1.13 million barrels to 7.53 million a day in June. 

READ ALSO: Brent crude surges past $40, analyst recommends investment in crude oil derivatives

Other members like Venezuela pumped only 340,000 barrels a day in June, even though they are exempted from cuts as the country is dealing with a series of issues from US sanctions to a severe economic recession. 

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Meanwhile, Russia hit its target quota for the second month in a row as countries outside the OPEC also cut production due to falling demand impacted by the COVID-19 pandemic. 

Patricia
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