The Financial Reporting Council of Nigeria has announced plans to formally incorporate Islamic Finance Services into the country’s financial reporting framework.

The FRC said this integration will involve adopting standards issued by the Accounting and Auditing Organisation for Islamic Financial Institutions.

This was disclosed in a statement on Monday by the FRC Executive Secretary and CEO, Dr. Rabiu Olowo, while speaking at the seventh Africa Islamic Finance Conference in Lagos.

He noted that the move aligns with the Council’s mandate to set, monitor, and enforce financial reporting standards in Nigeria.

Dr. Olowo emphasized that the rapid growth of Islamic finance in the country, including Islamic banking, Sukuk issuances, Takaful insurance, and non-interest capital market products, calls for consistent and globally comparable reporting standards.

“This sector has become a dynamic contributor to financial inclusion, infrastructure financing, and ethical investment alternatives.

“However, this growth brings with it the obligation for regulators to ensure that financial reporting for Islamic Finance Services is consistent, reliable, and globally comparable,” he stated.

Olowo added that adopting AAOIFI standards would complement existing IFRS practices while offering a specialized framework tailored to the unique contracts and financial instruments of Islamic finance.

Vice President Kashim Shettima, represented by the President’s Special Adviser on Economic Affairs, Dr. Tope Fasua, noted that “Islamic finance has emerged as a powerful ally, grounded in ethics, fairness, and shared prosperity.”

Also at the conference, the 14th Emir of Kano and former Governor of the Central Bank of Nigeria, Muhammadu Sanusi II, expressed his delight at the sector’s growth.

“We are beginning to see geometric growth in the number of banks that have been licensed and the number that have applied for licences. Islamic financing, at its core, invests in real assets like roads, power plants, water and digital networks. In Nigeria, for instance, constant access to electricity will easily create a $1tn economy.

“Islamic financing fits perfectly with infrastructure finance more than any other system because it is built on truth, where every financing is tied to a real, tangible asset that creates jobs and long-term value,” Sanusi II said.