AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
Most Canadian businesses keep their books and report tax in Canadian dollars, so every naira or US dollar transaction is converted to CAD at a rate you can show. The CRA tells corporations to use the Bank of Canada daily rate, but the Bank does not publish a naira rate, so you need a documented, consistent method for NGN. A company can elect a different tax reporting currency only for the British pound, euro, Australian dollar, US dollar or yen, never the naira.
Start with one question: what is your functional currency?
Accountants use the term functional currency for "the currency of the primary economic environment in which the entity operates", in the words of the IFRS Foundation's summary of IAS 21. For a Toronto company that sells to Canadian customers, pays Canadian rent and staff, and buys some services from Lagos, that is the Canadian dollar. Naira and US dollars are then foreign currencies, and every transaction in them has to be expressed in CAD in the ledger.
Some businesses run by Nigerians abroad look different. A company that invoices almost everything in US dollars, borrows in dollars and prices its contracts in dollars may have a stronger case for USD as its functional currency for accounting purposes. That is a judgement for you and your accountant under the accounting framework you report under, and it is separate from the tax question below.
Tax reporting is in CAD unless you elect otherwise
For income tax, a Canadian corporation reports in Canadian dollars by default. The CRA's functional currency page (modified September 2026) allows an election to report in another currency, but only "the British pound, the Euro, the Australian dollar, the U.S. (United States) dollar and the Japanese yen". The election is filed on Form T1296 "within the first 61 days of the tax year to which the election applies". The naira is not on the list, so a business cannot report its Canadian tax in NGN, whatever share of its trade is with Nigeria.
When converting, the same CRA page says to "use the Bank of Canada daily exchange rate, to 4 decimal places, of the particular day", and the rate of the closest preceding day when none is quoted. This is where naira creates a practical gap: the Bank of Canada's daily table (dated 23 October 2026 when we checked) lists 24 currencies, including the US dollar, pound and euro, but not the Nigerian naira.
A workable method for naira entries
Because there is no official CAD/NGN rate from the Bank of Canada, you need a method you can explain and repeat. Common approaches, to agree with your accountant, are:
- Use the actual conversion. When naira is bought or sold, the CAD that left or arrived is the best evidence of the rate for that transaction. Keep the conversion confirmation.
- Cross through the US dollar. Take the Central Bank of Nigeria's published NGN/USD rate for the day and the Bank of Canada USD/CAD rate for the same day, and multiply. Record both figures and the source.
- Pick one source and keep it. Whatever you choose, use it for the whole year and write it down in a one-page accounting policy note. Switching sources to get a better answer is what a reviewer looks for.
Worked example: one month of mixed entries
Example only, with made-up rates. A Calgary design firm pays a Lagos illustrator ₦1,800,000, receives US$4,000 from a client, and pays C$2,500 rent.
| Entry | Original amount | Rate used (example) | CAD in the ledger |
|---|---|---|---|
| Illustrator invoice | ₦1,800,000 | 1 CAD = ₦1,100 (actual conversion) | C$1,636.36 |
| Client receipt | US$4,000 | 1 USD = 1.3800 CAD (Bank of Canada) | C$5,520.00 |
| Rent | C$2,500 | none needed | C$2,500.00 |
Check: 1,800,000 ÷ 1,100 = 1,636.36; 4,000 × 1.38 = 5,520. If the US dollars sit in a USD account until month end and the rate moves, the CAD value of that balance changes too. That difference is an exchange gain or loss, explained in recording FX gains and losses on naira payments, and the year-end rate question is covered in which Bank of Canada rate to use for year-end naira balances.
Records that hold the method together
The CRA requires records to "be supported by documents", to be reliable and complete, and to be kept "in English, French, or a combination of these two languages". Most Nigerian invoices are in English already; anything in another language needs a translation kept alongside it. Records must be kept for six years from the end of the tax year they relate to, at your place of business or residence in Canada unless the CRA gives written permission otherwise, and the CRA treats records held outside Canada and accessed electronically from Canada as not kept in Canada. For each foreign-currency transaction keep:
- The invoice or contract in its original currency.
- The bank or account statement showing the money moving.
- The rate used, with its source and date.
- Any conversion confirmation showing the rate and fee charged.
Run separate ledger accounts for each currency balance you hold (a naira account, a USD account) so the CAD value of each can be revalued on its own. Accounting software with multicurrency support does much of this; see setting up QuickBooks Online multicurrency with naira. This is information, not accounting or tax advice.
Where Pryme fits
A Pryme Business Account can be opened from Canada and holds NGN, USD, GBP and EUR with local account details for each, so money stays in the currency it arrived in until you decide to convert. When you do, Swap shows the rate first and the fee on its own line before you approve, which gives you the conversion record your books need. Outside Nigeria, Pryme's financial activities are carried out through regulated partners.
Questions people ask
Can my Canadian company keep its books in naira?
You can track naira balances in a naira ledger, but tax reporting is in Canadian dollars unless you elect a functional currency, and the CRA allows only the pound, euro, Australian dollar, US dollar and yen for that election.
Which exchange rate does the CRA want for naira?
The CRA's functional currency page points to the Bank of Canada daily rate, but the Bank does not publish a naira rate. Use a documented, consistent method, such as the actual conversion or a cross rate through the US dollar, and keep the evidence.
Do I need a separate bank account for each currency?
It is not a legal requirement, but holding each currency in its own account and ledger makes revaluation and reconciliation far simpler.
How long do I keep the naira invoices?
Six years from the end of the tax year they relate to, in English or French, and kept in Canada unless the CRA gives written permission otherwise.
Sources
- CRA: Functional currency (modified 14 Sep 2026) · accessed Oct 2026
- Bank of Canada: Daily exchange rates (table dated 23 Oct 2026) · accessed Oct 2026
- IFRS Foundation: IAS 21 The Effects of Changes in Foreign Exchange Rates (overview page) · accessed Oct 2026
- CRA: Your responsibilities and the requirements for the records the law requires you to keep (modified 17 Jun 2025) · accessed Oct 2026
- CRA: Where to keep your records, how long to keep them (modified 3 Aug 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.