A finance manager in Lagos approves a payment from a laptop in a Kano hotel, a branch accountant in Port Harcourt reads this morning’s sales figures before the shop opens. A supplier checks the status of an order without telephoning anyone. None of this needs a new kind of accounting.
It needs connections: the internet, a private network inside the business, wireless links and the networks that join computers together. This topic explains what each of them is, what each is used for, how they differ, what they bring to performance management, what they cost and risk, and the Nigerian rules that apply when a business depends on them.
It builds on the information systems topic, which explained the role, costs and benefits of a system. The next topic covers the information needed at strategic, tactical and operational levels.
In 30 seconds
The internet is a global public network of networks used to find information, communicate, trade, entertain and learn. An intranet is a private internal network of one organisation, used for secure communication, sharing documents, databases and applications, collaboration and training. An extranet is a controlled extension of the private network to selected outsiders such as suppliers and customers.
Wireless technology connects devices through radio waves without cables: Wi-Fi, Bluetooth and mobile networks. A network is a group of connected devices that share information and resources: a local area network covers an office, a metropolitan area network covers a city, and a wide area network covers a large area, the internet being the largest.
They give managers faster, more current information and lower communication costs, but they bring security, reliability, cost and data protection risks. In Nigeria, a cyber incident must be reported to the National Computer Emergency Response Team within 72 hours of detection, and a personal data breach likely to harm people must be reported to the data protection regulator within 72 hours.
Full marks come from linking each technology to a business use, a benefit and a risk.
The four technologies and how they differ
The internet
The internet is a vast, interconnected network of computers and devices across the world that lets users access information and communicate. It is a global public network: anyone with a connection and a device can use it. Its main uses are:
- Information access: searching, browsing websites and using online resources, such as government statistics, exchange rates and supplier prices.
- Communication: email, instant messaging, video calls and social media.
- E-commerce: online shopping, internet banking and financial transactions.
- Entertainment: streaming, gaming and online content.
- Education: online learning, research and educational resources.
The intranet
An intranet is a private internal network within an organisation, used for secure communication and resource sharing among employees. It uses the same technology as the internet, but it is closed to the public, and only staff who sign in can use it. Its uses are:
- Internal communication: company news, announcements and updates.
- Resource sharing: company documents, databases and applications, for example the latest price list, the budget file or the policy manual.
- Collaboration: working on projects, sharing files and communicating within teams.
- Training: access to training material and resources.
The extranet
An extranet is the part of an organisation’s private network that is opened, with controls, to selected outsiders, such as suppliers who check stock levels, customers who track orders, or auditors who receive documents. It sits between the open internet and the closed intranet. Access is by individual sign-in, and each outsider sees only what they need.
Wireless technology
Wireless technology lets devices connect to networks and the internet without physical cables, using radio waves or other electromagnetic waves. Examples are Wi-Fi, Bluetooth and cellular networks (fourth and fifth generation, written 4G and 5G). Its uses are:
- Internet access: through Wi-Fi hotspots or cellular networks.
- Device connectivity: linking smartphones, tablets and computers to networks.
- Data transfer: sharing files and data without cables.
Networks
A network is a group of interconnected devices that can communicate and share resources. It is used for communication (sharing information between devices), resource sharing (shared printers, storage and software) and collaboration (working together on projects and files). Networks are classified by the area they cover:
- Local area network (LAN): a small area, such as a home or one office or one building.
- Metropolitan area network (MAN): a city or metropolitan area, such as the branches of a bank in Lagos.
- Wide area network (WAN): a large geographic area, such as head office in Kano linked to depots in several states. The internet is the largest wide area network.
A business often joins its sites with a virtual private network (VPN), which sends private traffic through the public internet in encrypted form, so that remote staff and branches behave as if they were on the same private network.
What they bring to performance management, and what they risk
Benefits
- Faster, more current information. Branch results, stock levels and cash positions reach managers as events happen, not weeks later in a printed pack, so control action is earlier.
- Wider information. The internet gives cheap access to external information on customers, competitors, suppliers, regulation and markets, which the previous topic showed is needed for planning.
- Lower communication and distribution cost. Email, video calls and an intranet replace couriers, printing, travel and meetings.
- Shared, consistent information. One current version of the budget, price list or policy on the intranet avoids the errors of several outdated copies.
- Collaboration. Teams in different places work on the same files and can agree budgets and targets faster.
- Flexibility and mobility. Wireless access lets managers and staff work from anywhere, and lets a business add a workstation without new cabling.
- Reach. E-commerce and internet banking open new markets and payment methods.
- Training and control. Staff can learn and be tested online, and managers can monitor activity and performance remotely.
Risks and limitations
- Security. Connection to the internet exposes the business to hacking, malware and fraud. Wireless signals can be intercepted if they are not protected, and a lost phone with access to company data is a breach waiting to happen.
- Reliability and dependence. If the network or the internet link fails, work stops. Power cuts and weak links add to this risk in many Nigerian locations, so back-up links and power are part of the cost.
- Cost. Equipment, installation, subscriptions, bandwidth, maintenance, security software and training. Costs rise with the number of sites.
- Information overload and poor quality. More access gives more information, much of it irrelevant or unreliable. The external information limits listed in the previous topic apply to the internet in full.
- Misuse and lost productivity. Staff may use the internet for personal purposes, so a usage policy and monitoring are needed.
- Unequal access and change. Staff without skills or connections are left out, and resistance to change may slow adoption.
- Legal exposure. Holding and moving personal data over networks brings duties under Nigerian law, described next.
Nigerian rules that apply to networked systems
- Reporting cyber incidents. The Cybercrimes (Prohibition, Prevention, etc.) Act 2015, as amended by the Cybercrimes (Prohibition, Prevention, etc.) (Amendment) Act 2024, which was signed on 28 February 2024, requires a cyber threat or incident affecting a computer system or network to be reported to the National Computer Emergency Response Team (National CERT) within 72 hours of its detection. The earlier rule was seven days from the occurrence.
- Personal data breaches. Under section 40 of the Nigeria Data Protection Act 2023, a controller must notify the Nigeria Data Protection Commission within 72 hours of becoming aware of a breach likely to put people’s rights and freedoms at risk. Where the risk is high, the people affected must also be told.
- Moving data abroad. Using an internet service that stores data in another country is a cross-border transfer. It is allowed where the receiving country gives a level of protection consistent with the Act, or where other safeguards are in place, under the Act and the Commission’s 2025 implementation directive. Check where a cloud provider stores data before using it for customer or staff records.
- Internet service providers. The Nigerian Communications Commission’s Internet Code of Practice 2026, as reported by law firms in July 2026, requires internet access providers to notify the Commission and affected consumers within 48 hours of a breach involving consumer data. This binds the provider, not its business customers, but a business should make sure its contract with a provider obliges prompt notice to it.
In an exam answer, treat these as costs and controls: staff to detect and report incidents, encryption, access control, back-up, and a written incident plan. Confirm the current Commission and regulator notices before advising a real client.
Sources and references
- Cybercrimes (Prohibition, Prevention, etc.) Act 2015, as amended by the Cybercrimes (Prohibition, Prevention, etc.) (Amendment) Act 2024.
- Nigeria Data Protection Act 2023, section 40, and the Nigeria Data Protection Commission, General Application and Implementation Directive 2025 (in force from 19 September 2025).
- Nigerian Communications Commission, Internet Code of Practice 2026.
These points are stated as at 6 November 2026.
Costing a network decision
Most questions turn these technologies into a cost-benefit decision, using the layouts from the previous topic. The additional layouts are:
- Annual saving from replacing a manual process. Number of units × cost per unit per period × number of periods (for example printing and courier cost for each branch each month × branches × 12).
- Cost of downtime. Hours of downtime × cost per hour of lost work. A back-up link is worth buying if the downtime cost it saves is more than its cost.
- Present value of costs. Initial cost + annual running cost × annuity factor. When two options give the same benefits, choose the one with the lower present value of costs, then weigh the non-financial factors.
- Break-even level. The value of an uncertain variable (such as downtime hours) at which two options have equal present value of costs.
Annuity factors are shown to four decimal places, money is in ₦ million to two decimal places unless stated, and each answer is rounded once, at the end.
Worked examples
Example 1: an intranet replaces printed packs. Eko Plastics Limited sends printed monthly performance packs by courier to six branches at ₦95,000 per branch per month. An intranet would replace the packs. Set-up costs ₦4.50m and running costs are ₦1.20m a year. Required: the annual saving, the net annual saving and the payback period.
- Annual saving.
₦0.095m × 6 branches × 12 months = ₦6.84m. - Net annual saving.
6.84 − 1.20 = ₦5.64m. - Payback.
4.50 ÷ 5.64 = 0.80 years, about 9.6 months. - Comment. The saving is clear, so the case is strong. The company must add access controls, because performance packs are confidential and an intranet that is open to every employee shows each branch’s results to all.
Example 2: cabled or wireless office network. A firm must choose between a cabled network and a wireless one, both over four years with a cost of capital of 15% (annuity factor 2.8550). Cabled: installation ₦8.00m, maintenance ₦0.60m a year, expected downtime 8 hours a year. Wireless: installation ₦5.50m plus security equipment ₦1.20m, maintenance ₦0.90m a year, expected downtime 10 hours a year. Each hour of downtime costs ₦150,000 in lost work.
Required: the present value of costs of each option, and the downtime at which the wireless option costs the same as the cabled one.
- Cabled, annual cost.
0.60 + (8 × 0.15) = ₦1.80m.
Present value 1.80 × 2.8550 = ₦5.14m.
With installation: 8.00 + 5.14 = ₦13.14m. - Wireless, annual cost.
0.90 + (10 × 0.15) = ₦2.40m.
Present value 2.40 × 2.8550 = ₦6.85m.
With installation and security equipment (5.50 + 1.20 = 6.70): 6.70 + 6.85 = ₦13.55m. - Difference. The wireless option costs about ₦0.41m more in present value.
- Break-even downtime.
The most the wireless option may cost a year to equal the cabled option is (13.139 − 6.70) ÷ 2.8550 = 2.2553.
Less maintenance of 0.90 leaves 1.3553 for downtime, and 1.3553 ÷ 0.15 = 9.04 hours.
If the wireless network is down for fewer than 9.04 hours a year, it is cheaper. - Advice. The options are close, so non-financial factors decide: wireless gives mobility and easier expansion, and cabled gives reliability and easier security. The firm should test the downtime estimate, because it decides the choice.
Expect variants: a different number of years, residual values for equipment, downtime that differs by option, or a choice between a leased line and a VPN. Lay out the working the same way.
Common mistakes
- Mixing up the internet and the intranet. The internet is public and global; the intranet is private and internal.
- Giving a definition and stopping. Each technology needs a use, a benefit and a risk in the context of the business in the question.
- Calling every link a wide area network. Match the network to its reach: one building is local, a city is metropolitan, several states are wide area.
- Listing benefits without risks. Security, reliability and data protection are expected in a “discuss” answer.
- Forgetting running costs and downtime in a cost comparison.
- Quoting old reporting periods. The cyber incident report is due within 72 hours of detection, not seven days.
Quick revision
- Internet: global public network. Intranet: private internal network. Extranet: private network opened to selected outsiders.
- Wireless: no cables; Wi-Fi, Bluetooth, mobile networks. Uses: internet access, device connectivity, data transfer.
- Network: connected devices sharing communication, resources and collaboration. Local, metropolitan and wide area.
- Benefits: speed, wider information, lower cost, shared information, collaboration, mobility, reach.
- Risks: security, reliability, cost, overload, misuse, legal exposure.
- Nigeria: report cyber incidents to National CERT within 72 hours of detection; report personal data breaches likely to cause harm to the Commission within 72 hours.
How the marks are earned
- Distinguish or explain: a definition of each item plus the point of difference, about two marks each.
- State uses: one mark each, tied to a business activity.
- Discuss benefits and risks: both sides, with the business context, about one point per mark or two, and a conclusion.
- Calculate and advise: show the layout, give the figure, then give the decision with a non-financial reason.
Practice questions
These are original questions, written in the style of the Skills examination. Work each one before you open the answer.
Recall check: multiple choice
Question 1. An intranet is:
- A global public network
- A network of suppliers only
- A private internal network used by an organisation for secure communication and sharing
- A wireless network only
Show the answer
C. It is closed to the public and used by staff.
Question 2. The internet is best described as:
- A global public network for communication and information sharing
- A private network of one company
- A single office network
- A network of printers
Show the answer
A. Anyone with a connection can use it.
Question 3. A network covering one office building is a:
- Wide area network
- Metropolitan area network
- Extranet
- Local area network
Show the answer
D. A local area network covers a small area such as an office.
Question 4. A network linking the branches of a bank across one city is a:
- Local area network
- Metropolitan area network
- Wide area network
- Intranet only
Show the answer
B. A metropolitan area network covers a city.
Question 5. Which is an example of wireless technology?
- Fibre-optic cable
- Ethernet cable
- Wi-Fi
- Coaxial cable
Show the answer
C. Wi-Fi connects devices by radio waves, without cables.
Question 6. The internet is an example of a:
- Wide area network
- Local area network
- Metropolitan area network
- Personal intranet
Show the answer
A. It spans the world and is the largest wide area network.
Question 7. Which is a use of an intranet?
- Selling to the public online
- Sharing company news and training material with employees
- Streaming films
- Browsing competitors’ websites
Show the answer
B. Internal communication and training are intranet uses.
Question 8. A main risk of connecting a business system to the internet is:
- Fewer users
- Less information
- Lower cost
- Exposure to cyberattacks and data breaches
Show the answer
D. Security is the first risk to name.
Question 9. Under the Cybercrimes Act 2015 as amended in 2024, a cyber threat or incident must be reported to the National CERT within:
- Seven days of its occurrence
- 24 hours
- 72 hours of its detection
- 30 days
Show the answer
C. The amendment replaced seven days from occurrence with 72 hours from detection.
Question 10. An extranet is:
- A private network opened, with controls, to selected outsiders such as suppliers
- The public internet
- A network inside one machine
- A cable between two printers
Show the answer
A. Each outsider sees only what they need.
Section B style: written questions
Question 11 (10 marks). (a) Explain the difference between the internet, an intranet and an extranet. (6 marks) (b) State FOUR uses of an intranet in a company. (4 marks)
Question 12 (15 marks). Lekki Retail Limited has eight stores. It sends weekly stock reports by courier at ₦55,000 per store per month, and the finance manager travels to the stores at a cost of ₦3.6m a year. A private network linking the stores would remove both costs. It would cost ₦12.0m to set up and ₦2.4m a year to run, and would last three years. The cost of capital is 15% (annuity factor for three years: 2.2832).
(a) Calculate the net annual saving. (4 marks) (b) Calculate the payback period. (3 marks) (c) Calculate the net present value. (5 marks) (d) Advise whether the company should proceed, including the risks to be controlled. (3 marks)
Question 13 (20 marks). Arewa Distributors Limited has its head office in Kano and depots in four states. (a) Name the type of network best suited to (i) the computers on one floor of the head office, (ii) the four branch offices within Kano city, and (iii) links between Kano and the depots in other states.
(6 marks) (b) Discuss the benefits and risks of letting managers read company data on their personal phones over wireless connections. (8 marks) (c) The company’s main link is down for 14 hours a year, and each hour costs ₦220,000. A back-up link would cost ₦1.1m a year and cut the downtime to 3 hours a year. Calculate the net annual benefit of the back-up link and advise.
(4 marks) (d) State the reporting duties if a cyber incident also exposed customers’ personal data. (2 marks)
Model answers
Show the model answer to Question 11
(a) The internet is a global public network of networks that anyone can use for information, communication, trade and learning (2). An intranet is a private internal network of one organisation, open only to its staff, for secure communication and sharing of documents and applications (2).
An extranet is the part of the private network opened, with controls, to selected outsiders such as suppliers, customers or auditors, who see only what they need (2).
(b) Internal communication such as news and announcements; resource sharing such as documents, databases and applications; collaboration on projects and files; and training (1 each).
Show the model answer to Question 12
(a) Courier 8 stores × ₦0.055m × 12 = 5.28; travel 3.60; total saving 8.88; less running costs 2.40 = ₦6.48m a year (4).
(b) 12.00 ÷ 6.48 = 1.85 years (3).
(c)
- 6.48 × 2.2832 = 14.80
- less 12.00 = +₦2.80m (5).
(d) Proceed: the net present value is positive and the payback is well inside the three-year life. Control the risks: encrypt the links and control who can sign in, arrange a back-up connection because the stores will depend on it, train the staff, and report any cyber incident within 72 hours of detection (3).
Show the model answer to Question 13
(a) (i) Local area network (2). (ii) Metropolitan area network (2). (iii) Wide area network, with a virtual private network if the traffic uses the public internet (2).
(b) Benefits:
- managers get information at once and can decide and control without waiting to be in the office
- decisions are faster
- work is flexible
- no new equipment is bought by the company
Risks: a lost or stolen phone exposes company data; unsecured public Wi-Fi can be intercepted; malware on a personal device can reach company systems; the company has less control over personal devices; personal data on the phones brings duties under the Nigeria Data Protection Act 2023; and support and policy costs arise.
A sound policy requires passwords or biometrics, encryption, the ability to wipe a lost device, approved apps and staff training. Conclude that the benefits justify the arrangement only if these controls are in place (any eight points, one mark each, with a conclusion).
(c)
- Downtime saved (14 − 3) = 11 hours × ₦0.22m = ₦2.42m
- less cost of the link ₦1.10m = ₦1.32m net benefit a year.
- Buy the back-up link (4).
(d) Report the cyber incident to the National CERT within 72 hours of detection (1), and report the personal data breach to the Nigeria Data Protection Commission within 72 hours of becoming aware of it, if it is likely to put people’s rights and freedoms at risk (1).
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