The Accountant-Jan-Feb 2017

JOURNAL OF THE INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS OF KENYA 

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JANUARY - FEBRUARY 2017 

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KEY AUDIT 

MATTERS 

Tailored to provide relevant 

information to intended users 

THE POWER OF A 

WRITTEN PLAN 

DEVOLUTION AND 

THE COOPERATIVE 

MOVEMENT 

DISCOVER YOUR 

ALLERGY TRIGGERS 

IMPORTANCE OF 

CORE VALUES IN 

AN ORGANIZATION

TABLE OF CONTENTS 

4 

Financial 

reporting and 

assurance 

The Accountant’s ever Expanding 

Reporting Responsibilities 

20 

FiRe AWARD 2016 

10 

COVER STORY 

KEY AUDIT MATTERS 

62 

pen off 

The 2030 Agenda for 

Sustainable Development 

58 

TRAVEL 

Brexit makes Britain a 

bargain family holiday 

destination 

www.icpak.com 

Members of the Council 

Chairman 

FCPA Fernandes Barasa 

Vice Chairman 

FCPA Julius Mwatu 

Chief Executive 

CPA Dr. Patrick Ngumi 

(PhD) 

Council Members 

FCPA Pius Nduatih 

FCPA Wycliffe Shamiah 

CPA Geofrey Malombe 

CPA Obare Nyaega 

CPA Rose Mwaura 

CPA Susan Oyatsi 

Ms. Damaris Kimosop 

CPA June Kivinda 

CPA Samuel Okello 

Head of Publication/Editor 

Mbugua Njoroge 

mbugua.njoroge@icpak.com 

Editorial Consultant 

Angela Mutiso 

Marketing & Advertising 

Ideation Marketing 

info@ideationmarketing.co.ke 

Tel: +254 719 650 423 

Staff Writer 

Valerie Alusa 

Design, Layout & Print 

Colour Print 

Publication and Circulation 

ICPAK, CPA Centre, Thika Road 

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Email: memberservice@icpak.com 

The Accountant is published every 2 months by the Institute of Certified Public Accountants of Kenya. Views expressed in the journal do not necessarily reflect those of the institute, authors 

firms or employers. Reproduction of any article in this journal without permission is prohibited. The editor reserves the right to use, edit or shorten articles for accuracy, space and relevance. 

JANUARY - FEBRUARY 2017 1

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Email: accountant@icpak.com 

Address: ICPAK, CPA Centre, Thika Road 

P. O. Box 59963 - 00200 Nairobi Kenya 

2 JANUARY - FEBRUARY 2017

EDITORIAL 

Dear Reader, 

Happy New Year! 

With effect from 31st December 2016, 

ISA 701 requires the description of - Key 

Audit Matters (KAM) to be tailored to the 

facts and circumstances of the individual 

audit engagements and the entity. This 

will provide relevant and meaningful 

information to intended users of the 

auditor’s report. It is however expected 

that KAM will vary in terms of the number 

and selection of topics addressed and the 

nature in which they may be described. 

Unless law or regulation prescribes 

otherwise, when KAM are communicated, 

auditors are required to include certain 

introductory language under the heading 

Key Audit Matters in a separate section 

of the auditor’s report. Our cover story 

provides in-depth information on this. 

A derivative security is generally 

referred to as a financial contract whose 

value is derived from the value of an 

underlying asset or simply underlying. 

There are a wide range of financial 

assets that have been used as underlying, 

including equities or equity index, fixedincome 

instruments, foreign currencies, 

commodities, credit events and even 

other derivative securities. Depending on 

the types of underlying, the values of the 

derivative contracts can be derived from 

the corresponding equity prices, interest 

rates, exchange rates, commodity prices 

and the probabilities of certain credit 

events. Find these facts in the economy 

segment where we discuss the role of 

commodities and derivatives markets on 

Kenya’s economic growth. 

Currently several NSE listed firms 

are looking for a strategic 

investor or issuing right issues 

to raise the working capital 

level. A positive cash flow from 

operations implies that a firm 

was able to generate enough 

cash from continuing operations 

without the need for additional 

funds and shall give high returns to the 

shareholder. Some firms created this 

through dividends payment freezing. 

A negative cash flow from operations 

indicates that additional cash inflows 

were required for day-to-day operations 

of the firm/s. Find this report in Finance 

and Investment. In another article under 

this segment the author says that when 

informing to an audience that they can 

have profits but no money in the bank 

or incur losses and have money in the 

bank, the participants are astonished. 

Then on pointing out to a new venture 

business owner that profits do not equate 

to salary, they are mystified. Read it; it is a 

captivating story. 

In Public Policy, we discuss 

strengthening the Office of the Auditor 

General. Significant attention is being 

given to security apparatus of the country 

(in the past). This is done in order to 

secure our borders and maintain law and 

order internally - including shutting out 

oversight agencies from policing them; 

The National Assembly is not spared, 

ostensibly due to confidentiality. Under 

the 2010 constitution, the Office of the 

Auditor General has been mandated to 

audit all public institutions. In order to 

discharge this role in an effective way, 

sufficient funds should be allocated to 

protect public interest. 

Any organization needs good 

management for long-term success and 

efficient operation. Energy management 

is no different. However, the management 

of energy is often neglected, although 

there is considerable potential to save 

energy and reduce costs. At the same 

time, there is increasing pressure from 

rising energy prices, climate change 

legislation and the need to be seen 

to be environmentally responsible 

by customers and stakeholders. 

Saving energy makes business 

sense, and having a structured, 

co-ordinated and integrated 

approach maximizes these 

benefits. However, without good energy 

management, cost-effective opportunities 

can be easily overlooked. We reveal more 

in the environment section. 

It is said that the longest journey 

in the world begins with a single step. 

The Financial Reporting (FiRe) Award 

was launched in Kenya in 2002 and is 

today believed to be the most prestigious 

and coveted award in East Africa for 

Financial Reporting. The promoters of 

the FiRe Award were delighted to mark 

the 15th Anniversary of the Award 

whose 2016 theme was; Accountable 

governance for excellence and reliability 

in financial reporting in East Africa. We 

have a comprehensive analysis of the 

latest edition of this event. Barclays Bank 

of Kenya was declared overall winner. 

Additionally, Barclays won in the banking, 

listed, governance and in the International 

Financial Reporting Standards (IFRS) 

categories. It is a delight to win the 

FiRe Award whose value and popularity 

continues to be felt beyond its borders. 

In the health segment, we discuss 

allergies. As an allergy sufferer you should 

take control over the food you eat. Either 

make a list or track of the foods you are 

allergic to and ensure you exclude them 

from your diet. Consume foods that you 

have no trouble with and let them be as 

natural as possible. As often as possible, 

cook your own food and when you go 

to restaurants, make certain that the 

ingredients included in the food you are 

going to eat, agree with your system. 

Enjoy these wonderful articles plus all your 

regular features and have a Blessed and 

Prosperous New Year! 

Mbugua Njoroge 

Editor 


Financial reporting and assurance 

THE ACCOUNTANT’S EVER 

EXPANDING REPORTING 

RESPONSIBILITIES 

By FCPA Jim McFie, a Fellow of the Institute of Certified Public Accountants of Kenya 

The fourteenth session of the 

United Nations Conference 

on Trade and Development 

(UNCTAD) took place in 

Nairobi from Sunday 17th 

July to Friday 22nd July this year. On 

Thursday 21st July, there was a discussion 

on the International Standards on 

Accounting and Reporting (ISAR) “Highlevel 

Policy Dialogue on Sustainability 

Reporting” under the theme entitled 

“Building productive capacity to transform 

economies”. 

The UNCTAD secretariat pointed 

out that in the post-2015 era, resource 

allocation decisions need to be made with 

a new mind-set that puts the Sustainable 

Development Goals (SDGs) at the centre. 

This will have implications for enterprises 

and their reporting requirements and 

practices. In producing the goods and 

services that the global community 

consumes, enterprises utilize human, 

natural and financial resources that 

need to be recognized, measured and 

reported on, considering the targets and 

challenges of the SDG agenda. Policy 

makers, regulators, enterprises, financiers, 

and other stakeholders need to develop 

and agree on ways to enhance the role 

of accounting and reporting in assessing 

the contribution of the private sector 

towards attaining the SDGs. The session 

will facilitate an exchange of views on 

ways and means to enhance the role of 

corporate reporting as a tool to assess 

the private sector’s contribution to the 

SDGs. It will also contribute to gaining 

insights on main trends and challenges 

in the area of sustainability reporting, and 

strengthen institutional links with key 

stakeholders to facilitate progress towards 

the harmonization of accounting and 

sustainability reporting requirements. 

The discussion addressed the following 

issues: (a) Enhancing corporate disclosure 

and facilitating comparable and verifiable 

corporate reporting on SDG performance; 

(b) Promoting behavioural change at the 

enterprise level to support the attainment 

of the SDGs; and (c) Supporting SDGrelated 

investment decision making 

with reliable and comparable corporate 

disclosure. 

But some international accounting 

bodies, and multinationals, are also 

addressing an even more important topic: 

the question of human rights. Since 

2008, when the UN Human Rights 

Council unanimously endorsed the UN 

Protect, Respect and Remedy (PRR) 

Framework, it has been globally accepted 

that businesses have a responsibility to 

respect internationally recognised human 

rights. The human rights in question 

address social, economic, cultural, civil and 

political concerns. They are expressed in 

the International Bill of Human Rights 

and the Declaration on Fundamental 

Principles and Rights at Work of the 

International Labour Organization (ILO). 

Divided into three pillars, the PRR 

Framework sets out the complementary 

roles of the private and public sectors 

regarding business and human rights: 

Pillar 1: States have a duty to protect, 

respect and promote human rights; 

Pillar 2: Companies have a responsibility 

to respect human rights; and 

Pillar 3: Victims of business-related harm 

should have access to a remedy 

In establishing the ‘corporate 

responsibility to respect human rights’, 

Pillar 2 describes a fundamental 

responsibility of all enterprises irrespective 

of their size, purpose of business or 

where they operate. Importantly, this 

responsibility exists irrespective of a 

government’s ability to protect, respect and 

support citizens’ rights (Pillar 1). 

The UN PRR Framework was enhanced 

in 2011 when the UN Human Rights 

Council unanimously agreed the Guiding 

Principles on Business and Human Rights 

(henceforth the Guiding Principles). They 

detail how the UN Framework should be 

interpreted and provide top-level guidance 

on implementation. 

Today, they are the de facto standard for 

what constitutes good corporate behaviour. 

Many different types of organisations 

around the world, including large and 

small enterprises representing diverse 

industry sectors, accept, endorse and use 

them in their day-to-day activities. 

The PRR Framework and Guiding 

Principles mark a significant moment in 

history. For the first time, it is globally 



accepted that companies should consider 

and proactively assess the human rights 

impacts associated with their business 

actions, activities and relationships. Where 

relevant, they should address how they 

impact the lives of all their stakeholders, 

irrespective of the national laws where they 

operate. The expectation that organisations 

must ‘know and show’ is central to both 

the PRR Framework and the Guiding 

Principles. Companies should be able to 

demonstrate that they understand their 

impact on the human rights of their 

stakeholders. Both instruments outline a 

practical framework of human rights due 

diligence, which should dovetail with the 

existing risk-management processes that 

businesses operate. 

A human rights due diligence process is 

intended to identify, prevent, mitigate and 

account for how a company addresses its 

adverse human rights impacts. It is based 

on four key steps: 

Step 1: Assessing actual and potential 

human rights’ impacts; 

Step 2: Integrating and acting on the 

findings; 

Step 3: Tracking responses; and 

Step 4: Communicating about how 

impacts are addressed. 

While accountants may not be directly 

focused on conducting a human rights 

due-diligence process, they should still 

be aware of what it is and its key role in 

identifying the company’s human rights 

risks and impacts. 

Depending on the organisational structure, 

the actual process may be undertaken by 

sustainability/ corporate responsibility 

teams, internal or external risk assessors or 

specialist consultants. It should, however, 

include input from people and functions 

from across the business. Accountants 

have a major role in considering how a 

due diligence process can be adequately 

resourced and managed to complement 

existing risk-management systems. They 

should also be involved in reviewing 

findings and acting on any issues that 

come to light. 

Since 2011, there have been 

increasing signs of diverse and influential 

organisations around the world accepting 

the Guiding Principles. These are 

manifested in various ways, from adoption, 

adaptation and implementation to their 

use as the inspiration behind similar 

initiatives to guide and influence the 

actions of others. Evidence of action 

indicates a move towards alignment and 

convergence. 

To underscore ‘acceptance in practice’, 

various organisations have taken steps 

to either apply or adapt the Guiding 

Principles according to their geographical, 

sectoral or operational circumstances. 

Accountants should have the skills 

to develop risk reviews and corporate 

processes, often working with multiple and 

complex scenarios. With their professional 

objectivity, they are well placed to 

contribute to auditing and monitoring 

policies and actions. They can also help in 

the execution of strategic initiatives. 

When it comes to safeguarding 

reputation, such scrutiny is crucial. 

Accountants should be able to map out 

risk and opportunities, enabling them to 

engage with the Guiding Principles and 

identify both how their business might 

impact human rights and how human 

rights abuses might impact their business. 

To do so, they must manage and draw 

insights from corporate information and 

metrics. Companies already engaging 

in responsible business practices and 

applying human rights frameworks will 

gain significant advantage over those 

failing to recognise their importance. 

Companies also need to be confident in 

explaining new priorities to a wide range 

of stakeholders, supported by metrics that 

clearly justify their decisions. Having a 

clearer understanding of the implications 

of human rights to the business will 

also help financial decision making by 

highlighting areas where investment is 

required and enabling the evaluation of 

procurement options and performance. 

In recent years, non-financial factors 

have become a required element of 

corporate reporting. Finance professionals 

have a key role in identifying, measuring 

and analysing information that helps 

explain how their business creates value, 

both for itself and for wider society. 

Accountants must recognise their 

ethical and professional responsibilities, 

both to the codes of their professional 

body and particularly in relation to 

delivering objectivity, independence and 



integrity. Using this lens, they are well 

placed to review human rights impacts 

and determine how prepared their 

organisations are in terms of applying the 

Guiding Principles. 

Finance professionals play a crucial 

role in supporting and enabling longterm 

sustainable business success. They 

have an equally important obligation to 

ensure that their employers recognise the 

relevance of human rights in business, 

and that the success of their business 

operations should not come at the expense 

of the human rights of other people. 

What should finance professionals do 

specifically in relation to human rights? 

Here is some guidance: One, enquire: 

(a) Has the organisation made a public 

commitment to respecting human rights? 

This may take the form of a human 

rights policy, or the inclusion of a human 

rights statement within its policies on 

sustainability, corporate responsibility or 

other matters. It may also take the form 

of a public endorsement of the Guiding 

Principles. 

(b) Has the organisation signed up to a 

responsible business standard or initiative 

that includes a commitment to observing 

human rights (such as the UN Global 

Compact)? 

Accountants 

have a 

major role in 

considering how 

a due diligence 

process can 

be adequately 

resourced and 

managed to 

complement 

existing riskmanagement 

systems. 

(c) Has the organisation signed up to 

a sectoral initiative that has its own 

responsible business standard including a 

commitment to observing human rights? 

(An example is the International Council 

on Mining and Metals [ICMM].) 

(d) Has the organisation’s HR function 

developed systems to monitor issues such 

as gender equality in the workplace or 

beyond? 

(e) Is the procurement function aware of 

any requirements for companies to respect 

human rights? Or does it undertake 

human rights due diligence? 

(f ) How does the internal communications 

function share messages and help embed 

practices on the company’s position, 

policies and processes relating to respect 

for human rights? 

Two, keep apprised of: 

(a) Changes in the regulatory and legal 

landscape concerning business and 

human rights-related issues, such as 

new legislation or the development of 

National Action Plans on Business and 

Human Rights by either host or home 

governments. 

(b) New and relevant developments in the 

business and human rights field regarding 

business reporting and performance, 

such as the Corporate Human Rights 


Financial Reporting and Assurance 

Global Business 

Initiative on Human 

Rights (GBI) & 

Clifford Chance, 

Published on: 8 

November 2015 

Benchmark, the UN Guiding Principles 

Reporting Framework and the Business 

and Human Rights Assurance Framework. 

Three, review: 

(a) Any existing business strategy or 

plan. Look for strategic priorities that 

may adversely impact the human rights 

of stakeholders. If these are not apparent, 

make the case for considering how 

the company will address and manage 

its impact on the human rights of its 

stakeholders as one of the business’s 

ongoing strategic objectives. 

(b) Research gathered from different teams 

– look for any potential or actual human 

rights risks to the company, or impacts on 

stakeholders. Either of these may signal 

a ‘red flag’ (a legal risk that will require 

urgent action). 

(c) Reports addressing the human rights 

risks or impacts relating to relevant aspects 

of the organisation’s business (such as a 

project, operation or relationship). Upon 

reviewing, determine how any impacts to 

stakeholders and risks to the business that 

you identify may affect the organisation’s 

financial position. 

(d) Contracts – look for opportunities 

to insert the organisation’s human rights 

responsibilities into contracts with thirdparty 

suppliers, contractors and other 

players. The wording should unequivocally 

state the organisation’s commitment to 

upholding respect for internationallyrecognised 

human rights, elaborate on how 

it conducts its business and convey to third 

parties the need for them to adhere to the 

contract. 

(e) Insurance policies – seek any clauses 

that have a crossover with human rights 

impacts. If the wording is vague, consider 

asking the insurer to include specific 

clauses that safeguard the organisation’s 

activities, actions or relationships with 

respect to human rights. Alternatively, 

ask for the wording to be strengthened to 

ensure that your organisation is covered 

regarding any violation of human rights. 

Four, be alert to: Existing or legacy 

human rights issues in any merger, 

acquisition or divestiture prospect or 

related partnership. If these are not 

apparent, ensure that the due diligence 

process includes consideration of existing 

or legacy human rights issues. 

Five, ensure: 

(a) That new business/business 

development teams thoroughly assess 

the human rights situations in countries 

where the company may be embarking on 

a merger, acquisition or other investment. 

(b) That, when placing orders, the buying 

function considers the organisation’s 

responsibility to respect the human rights 

of its suppliers and associated contractors. 

Six, consider: 

(a) Adding human rights risks into existing 

risk management processes. 

(b) Adding human rights impacts by 

stakeholder into existing risk registers. 

(c) Developing key performance indicators 

(KPIs) that will help the company measure 

and track how it respects human rights and 

does not adversely impact on the rights of 

stakeholders. 

Seven, work with: Corporate reporting/ 

responsibility/sustainability/human 

resource (HR) or other related business 

functions to: 

(a) Develop relevant KPIs that will help 

the organisation determine how it respects 

human rights in all of its activities; 

(b) Establish and agree on the company’s 

management-reporting systems 

addressing non-financial issues such as 

human rights; 

(c) Develop and use appropriate nonfinancial 

KPIs that relate to the relevant 

business function’s interaction with human 

rights issues; and 

(d) Encourage training and development 

to improve understanding and awareness of 

relevant processes and policies, particularly 

for the functions that are most affected. 

Eight, allocate funding for: 

(a) Human rights country-risk analysis – 

this may be carried out internally if there 

is appropriate in-house human rights 

expertise, or externally via an expert 

independent consultant or consultancy. 

Free resources such as the Human Rights 

and Business Country Guide are helpful 

first guides to in-country human rights 

situations. 



(b) Stakeholder engagement, which 

may be needed to ascertain that a 

project or operation is not adversely 

impacting stakeholders’ rights. (Effective 

stakeholder engagement requires specific 

expertise and skills and ideally should be 

carried out by an independent provider 

to help engender trust in the process.) 

(c) Human rights impact assessment 

– assessing an organisation’s adverse 

impacts on the human rights of its 

stakeholders requires specialist expertise 

and skills. Similar to stakeholder 

engagement, the impact assessment 

process would be more trusted if carried 

out by a reputable, independent third 

party, potentially working alongside 

the organisation. The Guide to 

Human Rights Impact Assessment 

and Management11 provides a good 

overview of an assessment process. 

(d) Remediation and reparation – it 

is advisable to ring-fence funds for 

any corrective actions that may need 

to be addressed and for situations that 

could potentially trigger a reparation or 

compensation claim. 

(e) Learning and development – the 

business may benefit from engaging with 

organisations that consider and address 

business and human rights issues and 

offer peer-to-peer learning opportunities 

(eg. the Global Business Initiative on 

Human Rights). Some organisations 

offer sector-specific support on human 

rights (e.g. ICMM), while others, such 

as the 80+ Local Networks of the UN 

Global Compact, convene based on 

geography. 

(f ) Training – ensuring that relevant 

employees understand that concern 

for human rights is an important 

commitment of the company. Training 

on business and human rights is 

becoming more sophisticated, ranging 

from online courses to bespoke sessions 

tailored to an organisation’s needs. The 

organisation needs to decide what type 

of training is needed (awareness-raising 

or capacity-building) and who should be 

trained (all employees or specific teams). 

Nine, challenge: 

(a) Information and data compiled by 

business functions such as the corporate 

social responsibility/ sustainability 

teams. Ensure that this effectively 

identifies the organisation’s human 

rights risks and impacts associated with 

its business. 

In 2015, Unilever 

became globally 

recognised as the 

first company to 

publish a standalone 

human rights 

report based on 

the UN Guiding 

Principles Reporting 

Framework. The 

company’s longerterm 

aim is for 

every employee 

and supplier to 

have an appropriate 

understanding of the 

Guiding Principles. 

(b) Action plans drafted by the corporate 

social responsibility/sustainability and 

other relevant teams. Discuss solutions 

with them to ensure that the agreed 

approaches are cost-effective and meet the 

needs of the affected stakeholders. 

Finally, revisit: All human rightsrelated 

policies, processes and systems that 

have been developed and implemented; 

ascertain their effectiveness and make all 

appropriate adjustments 

In 2015, Unilever became globally 

recognised as the first company to publish 

a stand-alone human rights report based 

on the UN Guiding Principles Reporting 

Framework. The company’s longer-term 

aim is for every employee and supplier to 

have an appropriate understanding of the 

Guiding Principles. However, with 172,000 

employees, 76,000 suppliers and sales in 

more than 190 countries, this ambition 

presents a number of challenges. The report 

highlights Unilever’s efforts to embed and 

promote human rights practices in the 

business. It identified the salient issues 

faced by the company as discrimination, fair 

wages, forced labour, freedom of association, 

harassment, health and safety, land rights 

and working hours. With potentially 

millions of stakeholders in the organisation’s 

value chain, Unilever operates an ecosystem 

in which it can control some parts 

and only influence others. It also recognises 

the need for continuous improvement, with 

transparency and accountability being the 

critical drivers. And it understands that 

identifying problems in the value chain, 

then seeking feedback and sharing the 

knowledge gained, helps it to address those 

problems. Unilever identified issues of 

harassment as the issue that was most often 

reported internally in 2014, particularly 

in the agricultural sector. In response, the 

company launched three initiatives to 

combat sexual harassment in the Kericho 

tea plantation in Kenya. Community 

outreach, safety talks and targeted training 

exercises led to positive results and ongoing 

progress will be publicly reported. While 

Unilever understands the importance of 

quantitative and qualitative data collection 

and interpretation across multiple 

geographies, it has found gaps in readily 

available information. To bridge these gaps, 

the company is involving cross-functional 

teams, from procurement and finance to 

investor relations and human resources 

(HR), in assessing risk and identifying the 

value proposition. By compiling this first 

report, Unilever has committed itself to 

building frameworks for improved data 

collection, verification and analysis. This 

will feed into how the company continues 

to identify and remediate human rights 

challenges. 

Accountants’ responsibilities are always 

increasing: the profession needs persons 

who are widely educated and who can 

teach themselves a wide variety of skills: it 

is unfortunate that accounting is way down 

on the list of the most desired professions 

for youngsters to enter; every accountant 

in Kenya has to raise the quality of his or 

her work so that the importance of the 

profession is promoted. 


COVER STORY 

KEY AUDIT MATTERS 

By CPA Victor Kipkoech, kipkoechvictor@gmail.com 

Key Audit Matters (KAM) 

are those matters that in 

an auditor’s professional 

judgment were of most 

significance during the audit 

of financial statements of the period under 

review. As from 31st December 2016, ISA 

701 requires the description of KAM to 

be tailored to the facts and circumstances 

of the individual audit engagements and 

the entity in order to provide relevant and 

meaningful information to intended users 

of the auditor’s report. It is expected that 

KAM will vary in terms of the number 

and selection of topics addressed and the 

nature in which they may be described. 

Contextual Information 

Required to Be Included in the 

Auditor’s Report in Relation 

to KAM 

Unless law or regulation prescribes 

otherwise, when KAM are communicated, 

auditors are required to include the 

following introductory language under the 

heading “Key Audit Matters” in a separate 

section of the auditor’s report. 

Key Audit Matters 

Key audit matters are those matters that, 

in our professional judgment, were of most 

significance in our audit of the financial 

statements of the current period. These 

matters were addressed in the context 

of our audit of the financial statements 

as a whole, and in forming our opinion 

thereon, and we do not provide a separate 

opinion on these matters. 

Although standardized in nature, 

this language is intended to provide 

an appropriate context for users of the 

auditor’s report to understand the new 

concept of KAM – in particular that the 

communication of KAM: 

• Is not intended to imply that the matter 

has not been appropriately resolved by 

the auditor in forming the opinion on the 

financial statements. 

• Is not intended to represent or imply 

discrete opinions on separate elements of 

the financial statements. 

In addition, the Auditor’s 

Responsibilities for the Audit of the 

Financial Statements section of the 

auditor’s report will include the following 

description in relation to KAM. 

From the matters communicated 

with those charged with governance, 

we determine those matters that were 

of most significance in the audit of the 

financial statements of the current period 

and are therefore the key audit matters. 

We describe these matters in our auditor’s 

report unless law or regulation precludes 

public disclosure about the matter or 

when, in extremely rare circumstances, 

we determine that a matter should not 

be communicated in our report because 

the adverse consequences of doing so 

would reasonably be expected to outweigh 

the public interest benefits of such 

communication. 

Determining KAM, Including 

the Number of KAM for a 

Particular Engagement 

KAM should be specific to the entity 

and the audit that was performed in 

order to provide relevant and meaningful 

information to users. Therefore, ISA 701 

includes a judgment based decision making 

framework to help auditors determine 

which matters, from those communicated 

with those charged with governance (ISA 

260), are KAM. This decision making 

framework was developed to focus 

auditors on areas about which users have 

expressed interest. In particular, areas of 

the financial statements that involved the 

most significant or complex judgments by 

management and areas of auditor focus in 

accordance with the risk-based approach 

in the ISAs. 

The number of KAM that will be 

communicated in the auditor’s report may 

be affected by the complexity of the entity’s 

business and industry, and the facts and 

circumstances of the audit engagement. It 

is envisaged that there will be at least one 

KAM for an audit of a listed entity. 

Required Elements in the 

Description 

The description of a KAM is always 

required to include a reference to the 

related disclosures, if any, in the financial 

statements and address: 

• Why the matter was considered to be 

one of most significance in the audit and 


COVER STORY 

KAM should be specific to the entity and 

the audit that was performed in order to 

provide relevant and meaningful information 

to users. Therefore, ISA 701 includes a 

judgment based decision making framework 

to help auditors determine which matters, 

from those communicated with those 

charged with governance (ISA 260), are 

KAM. This decision making framework was 

developed to focus auditors on areas about 

which users have expressed interest. 

therefore determined to be a KAM. 

• How the matter was addressed in the 

audit. 

The requirement in ISA 701 relating 

to the description of a KAM is intended 

to provide sufficient and balanced 

explanation about the matter. However, 

the level of detail in the description of 

each KAM is a matter of professional 

judgment, and may vary depending on 

the specific facts and circumstances of the 

particular engagement. 

The International Audit and Assurance 

Standard Board was of the view that this 

flexibility is important to enable auditors 

to be as entity specific and audit-specific 

as possible in the description of a KAM, in 

order to mitigate concerns from intended 

users that communication of KAM could 

quickly result in more standardized 

communications. 

Presentation 

The order of presentation of individual 

matters within the KAM section of the 

auditor’s report is a matter of professional 

judgment. For example, such information 

may be organized in order of relative 

importance, based on the auditor’s 

judgment, or may correspond to the 

manner in which matters are disclosed in 

the financial statements. The auditor is also 

required to include subheadings for each 

individual KAM to further differentiate 

the matters. 

The examples below represent extracts 

of what may be included in a KAM 

description and the level of detail that may 

be included in the description of a KAM 

in the auditor’s report. 

a) Why the matter was determined to be 

a KAM 

The description of a KAM in the auditor’s 

report is intended to provide insight to 

intended users as to why the matter was 

determined to be a KAM (i.e., why it 

was a matter of most significance in the 

audit of the financial statements of the 

current period). ISA 701 also provides 

robust guidance to support the judgment 

based decision making framework in 

determining the relative significance of a 

matter communicated with those charged 

with governance and whether such a 

matter is a KAM. 

Entity-specific information included 

in a KAM that relates to a matter 

disclosed in the financial statements is 

intended to be consistent with those 

disclosures and should not result in the 

auditor inappropriately providing original 

information about the matter or the entity. 

b) How the Matter Was Addressed in 

the Audit 

The description of a KAM in the auditor’s 

report is also intended to describe how 

the matter was addressed in the audit. 

The amount of detail to be provided in 

the auditor’s report to do so is a matter of 

professional judgment. ISA 701 explains 

that auditors may describe how a KAM 

was addressed in the audit by describing 

aspects of the auditor’s response or 

approach that were most relevant to the 

matter or specific to the assessed risk of 

material misstatement, a brief overview of 

procedures performed; an indication of the 

outcome of the auditor’s procedures, or key 

observations with respect to the matter, or 

some combination of these elements. 

If the auditor provides an indication of 

the outcome of the auditor’s procedures in 

the description of a KAM, care is needed 

to avoid the auditor giving the impression 

that the description is conveying a 

separate opinion on an individual KAM 

or that in any way may call into question 

the auditor’s opinion on the financial 

statements as a whole. 

c) Reference to the Related 

Disclosure(s) in the Financial 

Statements 

The auditor’s communication of KAM in 

the auditor’s report is not intended to be a 

substitute for the inclusion of appropriate 

and relevant financial statement 

disclosures, because management is 

responsible for providing information 

about the financial statements and the 

entity. 

The description of a KAM in the 

auditor’s report will always refer to 

any related disclosures in the financial 

statements. Reference to any related 

disclosures enables intended users to 

further understand how management 

has addressed the matter in preparing 

the financial statements. In addition to 

referring to related disclosure(s), the 

auditor’s description of a KAM may 

draw attention to key aspects of such 

disclosures. Therefore, the extent of 

disclosure by management about specific 

aspects of a particular matter in the 

financial statements may help the auditor 

in describing how those specific aspects 

were addressed in the audit such that 

intended users can understand why the 

matter is a KAM. 


MANAGEMENT 

INCUMBENCY AND 

DEEP END DIVING 

Emerging Business Risks 

By CPA Charles Mwitari, charles.mwitari@gmail.com 

There has always existed the 

ever-present possibility of an 

adverse event affecting the 

business performance. The 

business managers have for a 

long time focused on physical risks which 

could destroy the business assets such as 

fire or accidents. 

Development of insurance industry 

and products responded well to these 

risks and can now cover most of the risks 

associated with business disruptions. The 

other traditional risk is the loss of revenue 

through theft and frauds, mainly caused by 

weaknesses in internal controls. This risk 

was quickly addressed internally through 

creation of internal audit departments. 

The external auditors further gave their 

assurance by confirming the Financial 

Statements presented the true and fair 

view or otherwise. 

So why business failures while the 

most obvious risks have already been 

taken care of? The recent revelation of 

billions of Kenya shilling losses at the 

Premier Africa Airline, Kenya Airways 

and Uchumi Supermarkets Ltd revealed 

an emergence of new kinds of risks that 

need to be proactively addressed. The 

two, have significant shareholding by 

the ‘taxpayers’ through the government 

which has invested public funds in 

them, they are significant to the country 

as flagship brands hence attract a lot 

of public sympathy when they are in 

financial trouble and the government is 

often obliged to dip into public coffers 

to rescue them. An analysis of the main 

causes of these business failures will help 

bring out the new risks that need to be 

managed. The two companies expanded 

their business operations at a very fast rate 

resulting into a case of putting the “Cat 

before the Horse”. Today’s shareholder 

is interested in returns in both dividends 

and capital gains and not mere public 

stunts in the name of business expansion. 

Kenya Airways “Project Mawingu” 

focused on acquiring bigger airplanes 

worth billions of shillings with a view 

of operating new routes in Africa, Asia 

and Europe. Unfortunately the expected 

business did not come through due to 

various factors which though unforeseen 

are not unlikely and should have been 

factored in the business formulation stage. 

A ‘what if ’ approach would have advised 

a more cautious expansion. The Ebola 

outbreak in parts of West Africa, security 

threats due to increased terrorist attacks 

and downturn in tourism resulted into 

idle-capacity while the assets acquired 

through debt arrangements continued 

draining the limited resources. In 

2014/2015 the Pride of Africa reported 

Kshs.25.7 billion loss and went further to 

report a half year loss of ksh.11.9 billion 

in 2015/16. Uchumi Supermarkets 

followed very much the same path by 


MANAGEMENT 

The business stakeholders who include 

shareholders, boards, industry regulators 

including Capital Markets Authority, 

Government Ministries, the National 

Treasury, professional bodies including 

ICPAK and the general public should be 

watchful when the same “drivers “ start 

becoming synonymous with the “vehicle” 

and when they seek support to implement 

capital intensive projects. 

opening multiple branches in Kenya, 

Uganda and Tanzania. It also reported a 

loss of Kshs.3.4 billion in 2014/2015. In 

both cases the management teams and 

the respective boards were found to have 

been in place for over a decade resulting 

into complacency and ideology failure, 

they were seeking a quick and long term 

turn-around solution to the business. 

They were found in bed with their equally 

long serving auditors who dropped their 

guard as the friendship blossomed. This is 

the emerging business risk of incumbency 

and complacency that needs to be dealt 

with by re-invigorating and implementing 

the corporate governance and ethics 

guidelines. 

The first six years of a new 

management are usually coupled with a 

brilliant new vision, rebranding a new 

strategic plan and noticeable turnaround 

in business fortunes. However, that where 

it ends and what follows is stagnation 

or downturn as the management rides 

on their past success ignoring the need 

for continuous innovation and creativity 

and instead resorting to publicity seeking 

opportunities often on redundant and 

moribund projects. Having steered their 

organization to success, the management 

and boards realize that that they have 

limited time left and the only way, is out. 

This is when they start asking themselves 

what can the organization do for me? They 

start going against every rule of corporate 

governance and ethics and most often 

engage in business with the firm as a 

priority supplier either directly or through 

proxies resulting in conflict of interest. 

To overcome this normal curve 

denegation that, dictates the only way 

after the first five year cycle is down is to 

limit the term of the CEOs, the senior 

management and the board to a maximum 

term not exceeding six years (2 terms of 3 

years each) Such a shift would result into 

the new management picking at the apex 

of performance and thus building onto 

the successes of the previous management 

instead of waiting to build the company 

while it has degenerated into a ramshackle. 

The auditors, advisors, consultants and 

other business partners should be rotated 

on a similar or shorter term in order to 

safeguard competence and independence. 

Business strategies that significantly 

alter the business model and which have 

huge capital should be implemented using 

a phased approach and should never be a 

‘deep end dive’. As they say Rome was 

not built in a day, business success is a 

journey rather than a knee-jerk reaction. 

This allows the business to monitor and 

evaluate results and come up with a midterm 

report on whether to retreat or go 

full hog with the strategy implementation 

based on some visible results rather than 

on unguided optimism. 

The business stakeholders who include 

shareholders, boards, industry regulators 

including Capital Markets Authority, 

Government Ministries, the National 

Treasury , professional bodies including 

ICPAK and the general public should be 

watchful when the same “drivers “ start 

becoming synonymous with the “vehicle” 

and when they seek support to implement 

capital intensive projects. This should 

be a red light to conduct due diligence 

and ask hard questions on the projects 

viability and effect boardroom changes to 

encourage innovation and creativity. 

A stitch in time saves nine; better 

late than never; prevention is better than 

cure. These were indeed well thought out 

sayings; that call for action now; this is 

a call to stop incumbency and deep end 

diving in the corporate sector and save 

shareholders and the public the pain of 

losses. 

The writer is Financial Management 

Practitioner and a member of the ICPAK 

Finance and Strategy committee 


MANAGEMENT 

EFFECTIVE LEADERSHIP 

THROUGH 

DEEP REFLECTION 

By CPA Joseph Nyanchama, nyanchamajoseph@gmail.com 

A 

story is told that one night 

a man was relaxing with his 

newspaper after a long day at 

the office. His son who wanted 

to play kept on pestering him. 

He was fed up with his son’s disturbance 

and ripped out a picture of the globe that 

was in the paper and tore it into many tiny 

pieces. He gave it to his son and told him 

to put it back together hoping that this 

would keep the little boy busy long enough 

for him to finish reading the newspaper. 

To his amazement his son returned after 

only one minute with the globe perfectly 

reassembled. When the startled father 

asked how he was able to do it, the boy 

smiled gently and replied that on the other 

side of the globe there was a picture of a 

person and he only put the person together 

and the world was okay. 

The moral of the story is that success 

on the outside begins from within. That is, 

it all starts with getting yourself together. 

In a football match for example, the 


MANAGEMENT 

team has to break after forty five minutes 

for fifteen minutes and we call this break 

“half time.” Here in the halftime, the coach 

and the team members agree to be more 

creative, more impactful, more meaningful, 

and more adventurous and find more 

learning from the opponent’s moves and 

contribution than the first half. This is the 

time to take stock, to look back on what was 

accomplished, what worked and what didn’t 

work. Plays that didn’t work can either be 

adjusted or dropped for the second half; 

new plays can be drawn up and inserted. 

Many times a good second half can depend 

on what is done during half time. In other 

words it depends on how deep the team 

members individually reflect. Abe Lincoln 

said, “If I have eight hours to chop down 

a tree, I would spend six hours sharpening 

my axe”. From this analogy of a football 

match, I realize that why most failures 

are experienced in leadership is due to the 

failure to rest, reflect and take stock on how 

we are doing. If you cannot continually rest 

and reflect, you cannot know when you 

drifted from your purpose. 

Each leader should know that we were 

made on purpose for a purpose. Most 

leaders say they want riches. What they 

need I think is fulfillment of a purpose. 

Happiness comes when we abandon 

ourselves for a purpose. Don’t be a leader 

who does not know where you are leading 

your company to. Reflect all the time. 

Remember that growth for the sake of 

growth is the ideology of the cancer cells. 

Accumulating riches which is ill gotten is 

an aimless growth which is as dangerous 

as cancer cells which grow only to kill. 

Remember that without purpose the only 

thing you can do is to get old. Gilbert 

Arland said “When an archer misses the 

mark, he turns and looks for the fault 

within himself. Failure to hit the bull’s eye 

is never the fault of the target.” To improve, 

improve yourself. 

I would say here that one of the critical 

success factors which is key for one at 

leadership, be it in business or politics and 

is usually overlooked is relaxation and deep 

reflection. As a leader you need to know 

how to reflect and relax so that you can 

replenish your energies for the struggles 

facing you tomorrow. Lincoln went to 

the theatre about a hundred times while 

he was in Washington and although he 

suffered from a certain melancholy, he had 

a tremendous sense of humor and would 

entertain people long into the night with 

his stories .Franklin Roosevelt was the same 

way, he had this certain hour every evening 

during world war two when he just couldn’t 

talk about the war. He needed to remain 

free from thinking the bad things for a few 

hours or he would play with his stamps. 

This ability to recharge your batteries in the 

midst of great stress and crisis is crucial for 

successful leadership. 

When you relax and reflect deeply you 

start to experience extraordinary amount of 

emotional intelligence. You are now able 

to acknowledge your errors and learn from 

your mistakes to a remarkable degree. You 

realize that you are able to put past hurts 

behind yourself and you never allow wounds 

to fester. In fact you become aware of 

hindsight bias. What you should have done 

always seems clearer in retrospect than it 

was at the time. As the Danish philosopher 

Soren Kierkegaard put it “life can only be 

understood backwards, but it must be lived 

forward”. You cannot understand things 

backwards until you start to reflect while 

you are in a 

relaxed mode. 

Failing to 

create time 

for deep 

reflection and 

relaxation is 

like saying 

you are so 

busy driving 

that you don’t 

have time to 

stop at the 

petrol station 

and refuel 

your car. 

Descartes 

made many 

of his most 

important 

intellectual 

discoveries 

while relaxing 

in bed and 

Newton 

formulated 

the laws of 

gravity while 

meditating 

under an 

apple tree. 

Archimedes 

stumbled 

upon the 

laws of 

hydrostatics 

while soaking 

in a hot bath and Mozart composed one 

of his most famous pieces over a game 

of billiards. Elias Howe a Massuchettes 

instrument maker was deep in sleep when 

he had a bizarre dream. In it he was being 

chased by a man carrying a long spear with 

a small hole at the end of it .This served as 

the inspiration for his invention that later 

became known to the world as the sewing 

machine. Even Jesus Christ fasted for forty 

days and forty nights and after that he gave 

one of the most outstanding sermons-the 

sermon on the mountain. 

As leaders you need to relax and reflect 

deeply if you have to be effective. Even the 

challenge we face as a nation of corruption, 

it requires deep reflection if it has to be 

overcome. All is not lost. A game is won 

or lost in the second half. Take the time 

you are reading this article as your halftime, 

make appropriate adjustments and you will 

win the game. 


ADVERTORIAL 

THE 2 ND LADIES LEADERSHIP & 

ACCOUNTABILITY CONFERENCE 

Theme: Corporate Governance in a Dynamic World 

Date: 8th to 10th March, 2017 

Venue: Sarova White Sands Beach Resort & SPA, Mombasa 

BACKGROUND 

The 2nd Leadership and Accountability 

Forum is a continuation of the delightful 

Inaugural Ladies Leadership and 

Accountability Conference held in March 

2016 at Sarova White Sands Beach 

Resort & SPA, Mombasa. It builds on 

the initial theme of having women as 

architects and champions of leadership 

and accountability in Kenya by focusing 

on their role in corporate governance in 

a changing and dynamic world. As the 

gender agenda continues to take shape 

in Kenya and across the world, 

women are finding themselves 

increasingly at the helm of 

change. This conference 

reinforces and prepares 

them to take up leadership 

challenges even as they 

champion for accountability 

in both corporate and 

political spheres. 

The conference 

builds on the realization 

that despite the fact that 

women comprise a little 

over half of Africa’s 

growing population and 

their contribution to 

the region’s economy 

is extensive; women 

continue to form the 

majority of the poor in 

Africa. 

As the thirst for 

qualified women to 

take up leadership 

positions in both corporate and political 

spheres grows and the opportunities for 

women participation increase, a number of 

bottlenecks that constrain the development 

of women leaders have to be overcome. 

The socialization and stereotypes of female 

roles in society, lack of opportunities for 

women and inadequate organizational 

support among other tailbacks need to be 

explored and addressed if women are to 

succeed. 

WOMEN AND CORPORATE 

GOVERNANCE 

It has been rightfully observed that the 

corporate world is a place of societal social 

power, it is a place of conflicts of power, and 

even conflicts between people. And whilst 

most of these conflicts are regulated, more 

or less effectively, by the good governance 

standards, the quest for greater efficiency 

and ‘feminisation’ of Boards is a significant 

potential lever of change. Indeed, more 

and more women have slowly been 

brought into positions of power within 

government, corporations, academic 

institutions and other organizations. As 

such, inquiries into the presence and 

progress of women on boards especially on 

their role in corporate accountability is of 

critical importance. 

A recent study by the African 

Development Bank (AfDB 2015) 

observed that Women hold 12.7% of 

board directorships (364 out of 2,865) in 

307 listed companies based in 12 African 

countries. This is 4.6% lower than the 17.3% 

women’s representation on the boards of 


ADVERTORIAL 

the 200 largest companies globally. Even 

though Kenya had the highest percentage 

of women board directors in Africa 

at 19.8% as per the report, it has been 

observed that the proportion of women 

fall quickly up the corporate hierarchy. 

Progress across African countries has been 

patchy within and between countries with 

minimal women’s presence on boards. 

At a time when private sector growth 

in the continent is reaching unprecedented 

levels, efforts must be initiated to explore 

how women are involved – all the way from 

providing tertiary services to being at the 

decision making tables. Statistics indicate 

that even in the business world, the climb 

to the top can be particularly steep for 

women. A recent study on Fortune 500 

companies revealed that in US alone, even 

though women filled 52 percent of the 

professional jobs in the United States, a 

look at Fortune 500 board seats indicated 

that women formed a paltry 16.9 percent 

of the board seats. The statistics could be 

worse in Kenya and in Africa in general. 

CONFERENCE OBJECTIVES 

The conference aims to 

a) Foster Corporate leadership that 

enhances accountability and societal values 

by exploring the challenges, experiences, 

visions and achievements that continue 

to shape women leadership in the country 

and in the region. 

b) Explore the emerging trends in 

business and entrepreneurship and present 

opportunities to women. The dynamics 

of technology and an ever changing 

global market calls for; re-branding, reengineering 

and perpetual re-orienting, 

hence a total CONSOLIDATION of all 

gains to suit the day. 

c) Encourage and stir women leadership 

and participation in governance and 

accountability efforts towards revitalized 

corporations and societal good. 

Specifically, the participants will 

• Be accorded opportunities for 

networking with the diverse professionals 

creating new friendships, partners and 

mentors 

• Learn: discuss new ideas and 

opportunities during plenary sessions 

featuring influential and successful women 

in government and industry. 

• Identify and unlock leadership 

potential and skills 

• Be re-energized for relevance, 

effectiveness and efficiency in their 

corporate and professional life. 

TARGET PARTICIPANTS 

The conference targets CEOs, Directors 

and Women in Boards, Women Business 

leaders and Entrepreneurs; top, senior 

and middle lady managers in both private 

and public sector organizations; National 

and County Governments Ministries, 

Departments and Agencies: mentors, 

upcoming entrepreneurs, seasoned and 

aspiring politicians, Academicians, 

researchers and graduate students from 

both public and private institutions, NGOs, 

CSOs, and International Organizations 

with a focus on gender empowerment, 

entrepreneurship, leadership and 

accountability. 

KEY CONFERENCE TOPICS 

The following are the key conference 

topics: 

• Re-engineering Accountability 

in Kenya: Women’s role in shaping 

leadership and accountability in Kenya; 

• The Visionary Leader: Identifying and 

Developing leadership potential 

• Women and the Board Room dynamics 

• Executive Coach and Mentorship 

– Enhancing Excellence, Emotional 

Intelligence and Personal Branding 

• Feminization and Development - 

Bursting the Myths on the gender agenda 

• Women in ICT Entrepreneurship: 

Leveraging Technological Innovation for 

growth. 

• Women Leadership in Kenya’s Political 

Environment – Involvement and 

Participation in the 2017 elections and 

beyond 

• Scaling up enterprises; Women 

Leadership in Visioning and expanding 

organizations and enterprises 

What’s more: Networking and recreation 

sessions, Touring of Sites, CSR and 

Outdoor Activities 

CONTACT: 

Physical Address: CPA Centre Ruaraka, Thika Rd, 11th Floor 

Address: P.O. BOX 62914 00200 Nairobi 

Tel: +254 720 016556, Email: awak@awak.co.ke, Website: www.awak.co.ke 

Follow us: 

# womenleaders2017 

www.awak.co.ke 

Email: awak@awak.co.ke 

Tweet: @AWAK_2016 


ECONOMY 

THE ROLE OF COMMODITIES 

AND DERIVATIVES MARKETS ON 

KENYAN ECONOMIC GROWTH 

By Ndirangu Ngunjiri, operations@watermarkconsultants.com 

A 

derivative security is generally 

referred to as a financial 

contract whose value is 

derived from the value of an 

underlying asset or simply 

underlying. There are a wide range of 

financial assets that have been used as 

underlying, including equities or equity 

index, fixed-income instruments, foreign 

currencies, commodities, credit events and 

even other derivative securities. Depending 

on the types of underlying, the values of 

the derivative contracts can be derived 

from the corresponding equity prices, 

interest rates, exchange rates, commodity 

prices and the probabilities of certain 

credit events. There are four main types 

of derivatives contracts: forwards; futures, 

options and swaps. 

Derivatives have a long history and 

early trading can be traced back to Venice 

in the 12th century. Credit derivative 

deals at that period took the form of 

loans to fund a ship expedition with some 

insurance on the ship not returning. Later 

in the 16th century, derivatives contracts 

on commodities emerged. During that 

time, the slow speed in communication 

and high transportation costs presented 

key problems for traders. Merchants thus 

used derivatives contracts to allow farmers 

to lock in the price of a standardized grade 

of their produce at a later delivery date. 

Kenya’s financial markets have reached 

the level of sophistication from which 

it can move to the next stage with the 

introduction of derivative markets (both 

financial and commodity derivatives). 

Kenya can develop active agricultural and 

minerals derivative products but, first, 

Kenya needs to improve the spot markets 

for agricultural products which would 

improve prices for farmers and improve 

food security. This will help potatoes 

farmer in Molo to sell his produces at a 

better price and will be able to determine 

the selling price during planting. The 

Nairobi Securities Exchange (NSE) 

and Mombasa tea auction are ripe for 

commodities market. 

These instruments help economic agents 

to improve their management of market 

and credit risks. They also foster financial 

innovation and market developments, 

increasing the market resilience to shocks. 

The main challenge to capital market 

authority (CMA) will be to ensure that 

derivatives transactions are being properly 

traded and prudently supervised. This 

entails designing regulations and rules that 

aim to prevent the excessive risk-taking 

of market participants while not slowing 

the financial innovation aspect. And it 

also calls for improved data quantity and 

quality to enhance the understanding of 

derivatives markets, if properly handled 


ECONOMY 

derivatives can bring substantial economic 

benefits. 

A number of fundamental changes in 

global financial markets have contributed 

to the strong growth in derivative markets 

since the 1970s. First, the collapse of the 

Bretton Woods system of fixed exchange 

rates in 1971 increased the demand for 

hedging against exchange rate risk. The 

Chicago Mercantile Exchange allowed 

trading in currency futures in the following 

year. Second, the changing of its monetary 

policy target instrument by the US 

Federal Reserve (FED) promoted various 

derivatives markets. 

Derivatives allow users to meet the 

demand for cost-effective protection 

against risks associated with movements in 

the prices of the underlying. In other words, 

users of derivatives can hedge against 

fluctuations in exchange and interest rates, 

equity and commodity prices, as well as 

credit worthiness. Specifically, derivative 

transactions involve transferring those 

risks from entities less willing or able to 

manage them to those more willing or able 

to do so. 

Central clearing of derivatives 

transactions and more robust 

collateralization are important for 

mitigating counterparty risk in OTC 

markets. In addition, CMA and Nairobi 

Securities Exchange can design new rules 

to improve post-trade price transparency 

and encourage the migration of trading 

in some actively over the counter (OTC) 

traded products to exchanges. 

Some firms can use derivatives to obtain 

better financing terms. For example, banks 

will offer more favorable financing terms 

to those firms that have reduced their 

market risks through hedging activities 

than to those without. Fund managers 

can use derivatives to achieve specific asset 

allocation of their portfolios. For example, 

passive fund managers of specific indextracking 

funds may need to use derivatives 

to replicate exposures to some not so liquid 

financial assets. 

With Nairobi securities exchanges 

becoming important sources of investment 

Kenya can develop 

active agricultural 

and minerals 

derivative products 

but, first, Kenya 

needs to improve 

the spot markets for 

agricultural products 

which would improve 

prices for farmers and 

improve food security 

capital for large corporations, The 

Safaricom experience has revived debate 

on whether exchanges are capable of 

promoting economic growth. Suspicions 

over its weaknesses are not without basis. 

The absence of laws regulating trading 

in derivatives was largely blamed for 

the 2007 global financial crisis. If such 

practices could happen on the world’s 

biggest exchanges, how can Kenyan 

fragile economies withstand the whims of 

markets? 

The small size of Nairobi securities 

market and the absence of liquidity 

are often cited by foreign investors as 

the major impediments to investing 

in Kenya. East Africa Community has 

recommended merging its security market 

into regional exchanges as one solution. 

“A regional exchange should mean more 

liquidity — the lifeblood of exchanges — 

by making stocks available to a wider range 

of investors, 

Derivatives, if properly handled, 

should help improve the resilience of the 

system and bring economic benefits to the 

users, and expected to grow further with 

financial globalization. However, past 

credit events exposed many weaknesses 

in the organization of derivatives trading. 

The aim is to minimize the risks associated 

with such trades while enjoying the 

benefits they bring to the financial system. 

An important challenge is to design new 

rules and regulations to mitigate the risks 

and to promote transparency by improving 

the quality and quantity of statistics on 

derivatives markets. 


The FiRe AWARD 2016 

ACCOUNTABLE GOVERNANCE 

RELIABILITY IN FINANCIAL 

Compiled by Angela Mutiso, cananews@gmail.com 

Barclays Bank Bags Overall 

Prize 

It is said that the longest journey in 

the world begins with a single step. The 

Financial Reporting (FiRe) Award was 

launched in 2002 and is today believed to 

be the most prestigious and coveted award 

in East Africa for Financial Reporting. 

The promoters of the FiRe Award were 

delighted to mark the 15th Anniversary 

of the award whose 2016 theme was; 

Accountable governance for excellence 

and reliability in financial reporting in 

East Africa. 

Barclays Bank of Kenya was the overall 

winner of the 15 edition of the Financial 

Reporting (FiRe) Award. Additionally, 

the bank won in the banking, listed, 

governance and in the International 

Financial Reporting Standards (IFRS) 

categories. Of course there were several 

other winners in various categories in this 

well attended event that took place at the 

Windsor Hotel in Nairobi. 

The idea behind it is - to strengthen 

financial markets and attract investment. 

Business entities would have to make 

disclosure of their activities to enable 

a wide range of stakeholders to use 

such information in making economic 

decisions. For 15 years, the FiRe award 

has continued to thrive and has held an 

annual gala dinner in which the winners 

are presented at a colorful ceremony by 

The Institute of Public Accountants of 

Kenya (ICPAK); The Capital Markets 

Authority (CMA) ; The Nairobi Securities 

Exchange (NSE) and the Public Sector 

Accounting Standards Board (PSASB); 

who are the joint promoters. 

Over the years, the FiRe Award has 

recognized and awarded the best reporting 

entities in East Africa. The award is 

aimed at promoting integrated reporting 

through enhancing accountability, 

transparency and integrity in compliance 

with appropriate financial reporting 

framework and other disclosures on 

governance, social and environmental 

reporting by private, public and other 

entities in East Africa. 

Highlights of the 2016 FiRe 

Award 

The PSASB Chairman, Mr Bernard 

Ndung’u, who is also the Director General 

of Accounting and Quality Assurance 

Services at the National Treasury, said 

303 public sector entries participating 

in 2016, is a clear indication that the 

decision to adopt the International 

Public Sector Accounting Standards 

in 2014, as the reporting framework, 

is bearing fruit. The public Institutions 

include; Ministries, Departments and 

Agencies, State Corporations and Semi- 

Autonomous Government Agencies, and 

the County Governments. In addition 

to the 303 public sector entries, there are 

another 96 entries from across East Africa 

in the financial services sector, industrial, 

commercial and services sector, public 

benefits organizations, pension schemes 

and learning institutions, bringing the 

total entries to 399 in 2016 compared to 

376 in 2015. Mr Ndung’u said; ‘’Increased 

participation by the public sector 

underpins the commitment to more open 

accountability in the use of public funds 

and offers the entities an opportunity 

to be assessed against global standards’’. 

The CMA Chief Executive, Mr. Paul 

Muthaura, noted; “responsible financial 

reporting contributes significantly to 

Barclays Bank employees celebrate their win together 

with Ms Olajobi Makinwa, UN Global Compact Head of 

Transparency 20 JANUARY & Anti - FEBRUARY Corruption 2017 Initiatives


FOR EXCELLENCE AND 

REPORTING IN EAST AFRICA 

ICPAK CEO 

CPA Dr. Patrick Ngumi (PhD) 

NSE CEO 

Mr. Geoffrery Odundo 

PSASB Chairman 

CPA Bernard Ndung’u 

Capital Markets Authority CEO 

Mr. Paul Muthaura 



ICPAK Chief Executive Officer CPA Dr. Patrick Ngumi 

presents an award to Kenya Bankers Association 

Chief Finance Officer Mr. Kennedy Mutisya. 

ensuring that financial information put 

out by the entities is reliable and enables 

investors make informed decisions as 

they participate in the capital markets”. 

The NSE Chief Executive, Mr. Geoffrey 

Odundo, said; “The increased public sector 

participation in FiRe Award, will enhance 

accountability and transparency of public 

institutions, thereby increasing their 

attractiveness to investors and catalyzing 

economic growth “. The ICPAK Chief 

Executive, Dr. Patrick Ngumi, observed; 

‘’the entry of public sector in the FiRe 

Award creates expectations of enhanced 

disclosures of financial and non-financial 

information by public sector entities and 

contributes significantly to buttressing 

the informative value of public sector 

financial reporting as envisaged in the 

Public Financial Management Act, 2012’’. 

The awards focus on voluntary 

disclosure of relevant information in 

annual reports that go significantly 

beyond the minimum legal and regulatory 

requirements. The awards continue to 

be important for stakeholders and are 

expected to embed a stronger financial 

reporting culture in Kenya. Participating 

entities benefit from an evaluation 

feedback which helps them to improve 

their reporting every year. Entry for Fire 

Award is open to all entities and no 

charges are levied. Ms Olajobi Makinwa; 

The UN Global Compact Head of 

Transparency and Anti-Corruption 

Initiatives responsible for the UN 

Global Compact’s 10th principle on 

Transparency and Anti-Corruption was 

the Guest of Honour during the 

Fire Award Gala Dinner and 

Award Ceremony, Ms Olajobi 

in her address, commended 

Kenyan companies for advancing 

principles of good corporate 

governance as well as sustainability 

reporting stressing that, “culture 

of accountability is key to 

social economic empowerment, 

especially in Africa where cases of 

poor governance abound.” 

Jim McFie, a Fellow of the 

Institute of Certified Public 

Accountants of Kenya and FiRe 

Award Chief Judge had this to 

say: “The first sub-four minute 

mile in the world under timed 

conditions was run on 6th May 

1954 at Oxford University’s Iffley 

Road Track by a post-graduate 

medical student, Roger Bannister. 

Bannister was born on 23rd 

March 1929, and is still alive today 

at the age of 87. You can watch that race 

on YouTube. Also watch “Jim Ryun vs 

Kip Keino, London 1967” and “Keino 

vs Ryun, 1500m, 1968 Olympic Games, 

Mexico City”: these two videos show 

how Kichoge learnt his lesson in 1967 

in London and used the knowledge he 

gained in that race to win the second of 

many gold medals Kenya has won in the 

Olympics: Kipchoge displayed tenacious 

will power and determination, to go 

on and win a race that he had already 

dropped out of due to illness. The strong 

desire to win nudged him out of his 

hotel room, from where jogged to arrive 

at the stadium just before the start of 

the 1,500m race. Kipchoge won the race 

a clear 20m ahead of the pack to win 

that precious gold medal. In the same 

FCPA Dr. James 

Boyd McFie (PhD) 

Mexico City Olympics, Naphtali Temu 

took Kenya’s first ever gold medal: his 

win in the 10,000m race, marked Kenya’s 

triumphant entry into the big league 

of athletics. People around the world 

today know Kenya for many reasons: but 

the peoples of the world are constantly 

reminded of Kenya’s existence by Kenyan 

athletes winning marathons and races all 

over the world. 

But what does this have to do with 

the Financial Reporting Excellence, or 

the FiRe, Award? A lot: these victories in 

athletics are not solely due to the Godgiven 

gifts of the people born with these 

talents; they are the result of years of 

hard work. These athletes start training 

when they are at school where they are 

spotted by trainers who go out of their 

way to develop young women and men 

into world champions. Kipchoge did 

not beat Jim Ryun in 1967, just as in the 

1952 Olympics in Helsinki, Bannister 

finished fourth in the 1,500 metres. But 

both men used the “defeat” in the earlier 

race to win in the later race. Kipchoge’s 

win in Mexico City was a triumph: but 

when that first sub-four-minute mile was 

run by Bannister, a great feat in that year, 

the time was six tenths of one second shy 

of four minutes: in the last 50 years the 

mile record has been lowered by almost 17 

seconds: currently, it is held by Morocco’s 

Hicham El Guerrouj, who ran a time of 

3:43.13 in Rome in 1999. Somehow, the 

human race gets better and better at what 

it does if the stakes are high enough: and 

the same is true for the FiRe Award: each 

year it becomes harder and harder to win 

the best overall prize, and the many prizes 

contested for across the different sectors. 

So, which entity won the coveted FiRe 

Award this year? Barclays Bank of Kenya 

Limited was the overall winner this year 

2016: they (the Barclays team) have 

competed many times before and have 

sometimes won and sometimes not: close 

behind Barclays were Sameer Africa, the 

2015 FiRe Award winner; third, or second 

runners up as we like to say in Kenya, were 

Standard Chartered Bank – who were very 

close to Sameer Africa. The three annual 

reports were high quality documents. 

Barclays were two and a half, and three 

and a half, percentage points higher than 

Sameer Africa and Standard Chartered 

respectively in IFRS compliance; Barclays 

were one point four, and zero point nine, 

percentage points higher than Sameer 

and Standard Chartered on corporate 

governance disclosure. All the other 



PICTORIAL 

Barclays Bank employess lifting high Overall Trophy and other trophies 

won during this year’s Financial Reporting Award at the FiRe Award 

From left: NSE CEO Geoffrey Odundo, UN Global Compact Ms. Olajobi 

Makinwa, Barclays Bank CFO Yusuf Omari, CMA CEO Paul Muthaura 

and Benard Ndung’u Chairman Public Sector Accounting Standards 

Board celebrate the bank for emerging the overall winner 

FiRe Award 2016 Winners unveiled-FCPA Fernandes Barasa, ICPAK 

National Chairman hands over a trophy to the Office of the Controller 

of Budget staff for being winners of IPSAS Cash category 

Judicial Service representative CPA Susan Oyatsi receives 

a certificate of recognition from Benard Ndung’u Chairman 

(PSASB for being the most improved public sector entity 

From left; 

FiRe Award Chief 

Guest Ms. Olajobi 

Makinwa, ICPAK 

Chairman FCPA 

Fernandes Barasa, 

NSE CEO Geoffrey 

Odundo, CPA Patrick 

Abachi-Head of 

Secretariate PSASB 

and Capital Markets 

Authority CEO Mr. 

Paul Muthaura 



factors were most or less the same. But 

just as Kipchoge proved in Mexico City in 

1968, there is only one winner: in the 2016 

FiRe Award, that winner was Barclays – 

congratulations to them for a very fine 

Integrated Report. In the 2016 FiRe 

Award, there were more entries than ever: 

ninety six entities competed in the private 

sector part of the competition, divided into 

banks, insurance companies, industrialcommercial-services 

companies, companies 

that use the IFRS for SMEs, small 

companies which use full IFRS, SACCOs, 

Pension Funds and Not-for-profits; in 

the public sector, three hundred and three 

entities competed. Prepare yourself now for 

next year’s competition: and have Barclays 

in the cross-hairs as you aim for the gold. 

I tried to find the Barclays Bank financial 

statements for 2015 at https://www. 

barclays.co.ke/investor-relations/. However, 

each time I tried, I received a message as 

follows: “You don’t have permission to access 

/personal on this server”. Under the new 

Kenya Companies Act, all quoted companies 

must maintain websites and have their 

latest financial statements available on their 

websites for a period of at least one year: I 

am sure the non-availability of the Barclays 

financial statements is a temporary hitch: it 

is worth spending time going through the 

Barclays Integrated Report 2015 as part of 

your preparation for next year.” 

Meanwhile, in his address to the media 

during the post gala dinner conference, 

FCPA Julius Mwatu Vice Chairman of 

ICPAK said (excerpts); “arising from this 

year’s evaluations, we can confidently report 

that FiRe Award has come of age. The 

promoters are pleased to note that we had 

a total of 399 entries where 303 entries were 

received from public sector and 96 entries 

from the private sector. We commend 

Public Sector Accounting Standards Board 

(PSASB) for bringing on board public 

sector entities. 

Notwithstanding, we would like to give 

a highlight of areas that we think need 

improvement for both public and private 

entities: 

i. Report of the Independent Auditor 

All the private sector entities that submitted 

their annual report and financial statements 

had unqualified opinion. For Public sector 

entities, since the award is mandatory, 

all entities are received and review in 

accordance with Section 194(4) of the PFM 

Act, 2012, which provides that “The Board 

shall monitor the adherence to the standards 

by all State organs and public entities.” 

ii. Companies Act Requirements Cap 486 

The increased 

public sector 

participation in 

FiRe Award, 

will enhance 

accountability and 

transparency of 

public institutions, 

thereby increasing 

their attractiveness 

to investors 

and catalyzing 

economic growth. 

In a number of entities that submitted their 

annual reports and financial statements, 

there was no linkage between the companies’ 

act and the financial statements. Under 

section 148 of the Companies Act, Cap 

486, a company is required to present the 

balance sheet and profit and loss account. 

Management should ensure that they 

include a statement of compliance with the 

Companies act. 

iii. Public Finance Management Act 2012 

The PFM Act 2012 is applicable to all public 

sector entities and seeks to ensure effective 

management of public finances by the 

national and county governments as well as 

state corporations. The act lays down some 

of the disclosures that are to be provided 

by entities. During the evaluation the main 

non-compliance issues included: - 

• Failure to include the name and signature 

of the accounting officer who signed 

the annual report and audited financial 

statements. 

• The disclosures of assets and liabilities 

require significant improvement to facilitate 

inventory of assets. 

• Analysis of pending bills, outstanding 

imprest and other payables – several entities 

simply provided a listing as opposed to 

including aged analysis. 

• Very few entities presented a statement 

of the national government entity’s 

performance against predetermined 

objectives – this can be achieved by providing 

a detailed performance reports template for 

MDAs and other entities to populate which 

links the strategies of the entities to its 

performance and budget(s) 

Governance Reporting 

The FiRe Awards evaluation for 2016 

took into account the new developments 

which included the Mwongozo - the Code 

of Governance for State Corporations 

issued in January 2015, and the Code 

of Corporate Governance Practices for 

Issuers of Securities to the Public 2015. 

It was noted that a number of entities are 

yet to incorporate some of the changes 

introduced and the evaluators hope that by 

next year (2017) there should be significant 

improvements in the reporting and practices 

of governance.” 

THE PRE-FiRe AWARD 

CONFERENCE 

On Thursday, October 27 2016 before the 

Gala dinner, a Pre - FiRe Award conference 

was held at Safari Park Hotel in Nairobi 

with the same theme. The following topics 

were discussed; 

• The FiRe Awards 2016 Trends and 

Evaluation Process – the Judges’ perspective 

• Will your Governance Practices stand 

the test of time? 

• Transparency and Accountability in 

Government Accounting – the journey 

• Past winners’ experience; Return of 

investment of improved financial reporting 

• The new auditor’s report and its 

informative value 

• The future of organization reporting 

in East Africa – exploring integrated and 

sustainability reporting in East Africa 

Benefits of Participation 

One of the major benefits of participating 

in the FiRe Award is that each institution 

that submits its financial accounts also 

receives Individual feedback from the FiRe 

Award evaluators, a confidential assessment 

of the highlights and shortcomings of their 

documentation. The feedback is intended 

to enable the institution to improve 

on its reporting and by extension its 

communication with stakeholders. 

You are encouraged to participate. 

The promoters thank the 2016 judges and 

evaluators for their hard work and dedication 

in reviewing the 399 annual reports and 

audited financial statements of entities 

that entered the competition in 2016. Their 

volunteer contribution elevates the overall 

quality of corporate reporting in the East 

African Region. Without their dedication and 

sturdiness, no award would be presented. 



FiRe Award Promoters Congratulate 

Winners of 2016 FiRe Award edition 

FiRe Award promoters congratulate winners of 2016 FiRe Award Edition. The award seeks to promote integrated reporting 

through enhancing accountability, transparency and integrity in compliance with appropriate financial reporting framework and 

other disclosures on governance, social and environmental reporting by private and public sectors domiciled in East Africa. The 

annual Award is organized by the Public Sector Accounting Standards Board (PSASB), Capital Markets Authority (CMA), Nairobi 

Securities Exchange (NSE), and the Institute of Certified Public Accountants of Kenya (ICPAK). 

The winners honored in each industry are as follows: 

NO 

CATEGORY 

WINNER 

1ST RUNNER UP 

2ND RUNNER UP 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

Agriculture 

Bank 

Independent Offices & 

Constitutional Commissions 

Industrial, Commercial & 

Services 

Insurance 

Micro Finance Institutions 

MINISTRIES 

Not for Profit 

Sacco 

SME 

LISTED 

STATE CORPORATIONS 

AND SEMI-AUTONOMOUS 

GOVERNMENT AGENCIES 

(SAGAs) 

IPSAS CASH 

IPSAS ACCRUAL 

IFRS for SME 

IFRS (Public Sector Entities) 

IFRS 

BEST PFM 

Environmental & Social 

Reporting 

Governance 

Promoters’ Recognition 

Rwanda 

Tanzania 

Uganda 

Kenya 

BEST PUBLIC SECTOR 

OVERALL 

KAPCHORUA TEA LIMITED 

BARCLAYS BANK OF KENYA 

OFFICE OF THE 

CONTROLLER OF BUDGET 

SAMEER AFRICA 

AFRICA REINSURANCE 

CORPORATION 

FAULU MICROFINANCE 

BANK 

STATE DEPARTMENT OF 

FISHERIES 

STRATHMORE UNIVERSITY 

STIMA SACCO SOCIETY 

LIMITED 

KEVIAN 


KENYA ROADS BOARD 

OFFICE OF THE 

CONTROLLER OF BUDGET 


KENYA BANKERS 

ASSOCIATION 

CENTRAL BANK OF KENYA 


KENYA UNIVERSITIES 

AND COLLEGES CENTRAL 

PLACEMENT 

UMEME LIMITED 


BANK OF KIGALI 

CRDB BANK PLC 

STANBIC BANK UGANDA 




STANDARD 

CHARTERED BANK OF 

KENYA LIMITED 

INDEPENDENT 

POLICING OVERSIGHT 

AUTHORITY 

EAST AFRICAN CABLES 

BRITAM HOLDINGS 

LIMITED 

KENYA POWER 

PENSION FUND - DC 

UN SACCO 

SAMEER AFRICA 

CENTRAL BANK OF 

KENYA 

INDEPENDENT 

POLICING OVERSIGHT 

AUTHORITY 

KENYA UNIVERSITIES 

AND COLLEGES 

CENTRAL PLACEMENT 

KENYA ELECTRICITY 

GENERATING 

COMPANY LIMITED 

EQUITY GROUP 

HOLDINGS LIMITED 

NATIONAL COUNCIL 

FOR LAW REPORTING 

BAMBURI CEMENT 

LIMITED 

SAFARICOM LIMITED 

CRDB BANK PLC 

PUBLIC SERVICE 

COMMISSION 

BRITISH AMERICAN 

TOBACCO (K) LIMITED 

JUBILEE INSURANCE 

COMPANY OF KENYA 

LIMITED 

KENYA POWER 

PENSION FUND - DB 

UNAITAS SACCO 

KENYA ELECTRICITY 

GENERATING 

COMPANY LIMITED 

STATE DEPARTMENT 

OF FISHERIES 

NATIONAL COUNCIL 

FOR LAW REPORTING 

IDB CAPITAL LIMITED 

KENYA POWER 

PENSION FUND - DC 

KCB GROUP 

BRITISH AMERICAN 

TOBACCO (K) LIMITED 


Public Policy 

DEVOLUTION AND THE 

COOPERATIVE MOVEMENT 

By Paul G., Kimanipgicheha@yahoo.com 

The cooperative sector has been 

a key driver in the Kenyan 

economy in creation of wealth 

and employment opportunities. 

The Kenyan cooperative 

movement was in 2013 ranked first in 

Africa and seventh internationally. The 

government throughout history has come 

up with strict policies that will provide 

guidance and regulation in this vibrant 

sector. 

The fourth schedule of the Constitution 

of Kenya 2010 gives counties powers to 

develop and regulate cooperative societies. 

Previously they were regulated by the 

commissioner of cooperatives whose arm 

was under the ministry of cooperatives and 

development. 

The statutes that provided for their 

creation, development and supervision 

included the Cooperative Act Cap 490 

which was last reviewed in 2004 and 

the SACCO societies Act of 2008. It 

is however important to note that the 

SACCOs that operate the Front Office. 

The emergence of the devolved units as 

a result of the operational zing of the new 

Constitution has opened a new era on how 

cooperative societies will operate within 

the country. Already several counties have 

enacted the cooperative societies Acts 

within their jurisdiction. Examples of these 

counties include Machakos and Meru. 

Others like Makueni, Kilifi, Kiambu have 

already published the relevant cooperative 

societies bills and invited members of 

public to give their input. A look into 

the already enacted and proposed county 

legislation on the cooperative societies 

shows a lot of similarities between them 

and the cooperative Act that is ceasing to 

be operational in their areas. It is important 

to note that there are key differences 

between the statutes as well. 

The county statutes will see a 

transfer of roles from the ministry of 

cooperative societies in the national level 

to the department of cooperatives in the 

county level. These County Acts create 

a directorate of cooperatives which will 

assume the role that was previously held 

by the commissioner of cooperatives. It 

is important to note that most county 

legislations are clearly stating that their 

scope does not include the deposit taking 

SACCOs whose mandate falls under the 

Sacco societies Act 2008. 

The cooperative Act provides that for a 

cooperative society to be registered, at least 

ten members must sign the application 

to be registered into the cooperative. The 

Act also provides for a minimum number 

of members for a primary cooperative 

society to be ten. The Machakos, Meru 

County cooperative Acts both provide 

that the minimum number of people who 

are eligible to form a primary cooperative 

society should be fifteen. The laws require 

that at least ten of the applicants must 

sign the application to be formed into a 

cooperative society. 

Cooperative Accounts and 

Audit 

The cooperatives acts of the counties under 

review have the same provisions as the 

previous Act within their jurisdiction. The 

drafters are also careful to acknowledge 

the role of ICPAK in formulating 

standards within the country. However 

the legislations do not only recognize the 

application of the International standards 

of Accounting but empower the institute 

to provide guidelines on the standards to 

be adopted in the country. The auditors 

that will be allowed to audit the books 

of cooperatives within a specific county 

will have to obtain registration from 

the director of cooperatives within that 

county. This means that if an auditor seeks 

to audit cooperatives from two different 

counties, he will be required by law to 

register with the directors of cooperatives 

from the two counties. This of course will 

mean added costs of seeking registration 

for auditors who have audit engagements 

with cooperative societies from different 

counties. The position that was previously 

held is that the auditors would seek 

registration from the commissioner of 

cooperatives and then practice their 

audit all over the country with a single 

registration. The devolved legislation 

brings yet another change; where the 

accounts previously being registered at 

the commissioner’s office will now be 

registered at the county directors’ level. 

Since the regulation of professionals 

falls under the national government, it is 

our hope that to facilitate the movement 

of labour and services from one county 

to another freely without the bottle 

necks that these county legislations may 

bring about, ICPAK will engage the 

county governments through the council 

of governors so that the counties can be 

able to enjoy from a pool of qualified 

Accountants dealing with their books. 

Audit sanctioned by the 

county 

Among the counties that have enacted their 

County Cooperative Acts, Meru County 

seeks to annually conduct governance, 

financial and management systems audits. 

This if carried out in the right way will 

enhance corporate governance among the 

cooperatives within the counties. 

The effectiveness of carrying out annual 

systems audits will be determined by the 

quality of the audit personnel who will 

carry out these audits. Since these audit 

recommendations will have far reaching 

effects on the systems of an individual 

cooperative, it would be necessary for 

the Counties that have provided for 

this in their legislation to engage the 

relevant professional associations and the 

stakeholders for an all effective process. 

The way forward 

Since the role of managing cooperatives 

have been devolved and the governments 

have started domesticating their laws, the 

onus is now on the various stakeholders 

to ensure that there is a smooth transition 

into the devolved system and that the 

devolved units will in turn be a platform 

for their growth and not subjugation. 

Only then can one say that (especially 

for) primary cooperatives or those that do 

not fall under SASRA will have an avenue 

to develop themselves. 


Business Practice and Development 

ICPAK Annual 

Seminar 2016 

REINVENTING CONTINUOUS 

PROFESSIONAL DEVELOPMENT 

By Gladys Kibui 

Having worked as an 

accountant for sixteen years in 

the SME sector and currently 

as a volunteer in the micro 

enterprises (informal) sector 

since 2009, I have learnt lessons worth 

sharing with fellow accountants. 

When I worked with the formal 

SME sector, I was able to participate in 

professional development though with cost 

constraints and questionable relevance of 

the training. As an accountant of a small 

organization, one has to finance his or her 

own professional development. With the 

SME sector employing almost 80% of 

labor force, most of the accountants will 

identify with my sentiments. Apart from 

fulfilling the requirements of the Institute 

at ones cost, professional development 

for non practicing accountants working 

in the SME section has little significance 

on the effectiveness of the accountant. 

Most of the professional development for 

these accountants is derived from their 

auditors in the form of regular updates, 

annual newsletters and budget review 

seminars which are free. This however 

is not considered by the institute in 

computing the annual hours required for 

professional development. If encouraging 

lifelong learning is the goal of professional 

development, this should be considered 

alongside reading and writing other related 

books and articles. 

This is not only more relevant for the 

professional development of the individual 

accountant but also for the accounting 

profession and the nation as a whole. 

The profession benefits through creating 

awareness among the business fraternity for 

a larger market of the accounting services. 

The nation will benefit through job creation 

for the accountants as well as growth of 

well managed and profitable enterprises. 

As an individual accountant, one is able to 

mentor other accountants thus encouraging 

growth in the profession. Over the period 

I worked in the SME sector, I mentored 

many accountants who have since finalized 

their professional courses. Many of these 

have not joined the institute but continue 

to work as accountants without any 

professional accountability. This not only 

hinders professional development but 

also explains the lack of accountability in 

Kenya. With these two lacking, corruption 

has been on the rise in the country to the 

shame of the accounting profession. 

It is my submission that ICPAK 

consider recognizing the professional 

development of non practicing members 

by practicing members as outlined above. 

This will not only make continuous 

professional development relevant 

affordable but also manageable, using 

the time tested participatory approach. 

Practicing accountants should be obligated 

to develop the accountants of their client 

organizations and therefore hold them 

accountable for quality results. This will 

bring to the accountability bracket the 

SMEs and body corporates who have 

always had their financial statements 

audited. This includes most nonprofit 

organizations and micro enterprises. 

The benefit of this consideration 

includes increased accountability and 

curbing of the current run away corruption. 

Another benefit is the business continuity 

and sustainability of the economy through 

growth of small audit practices as well as 

professionally managed organizations. 

In the absence of this, accountancy 

is slowly sliding to irrelevance if my 

experience in the informal sector is 

anything to go by. Lack of book keeping 

and accountability has been used both as 

a means of advancing corruption and also 

as an excuse for poverty. In the latter case, 

many of the so called micro enterprises are 

making incomes in excess of half a million 

shillings on a monthly basis but pay no 

taxes as there are no records to prove the 

same. This in effect serves to discourage 

entrepreneurial growth and accountability 

for fear of paying taxes. 

As a qualified and experienced 

accountant who has developed more 

than a dozen accountants and numerous 

successful organizations, I would qualify for 

a practicing license which is not possible 

under the current professional development 

regime. Yet most of the practicing auditors 

whom I have worked with during my 

work in the micro enterprises have relied 

on my work just as they do with the work 

of internal auditors. Further, small audit 

practitioners are not able or willing to 

partner with non practicing accountants in 

most cases. The unfortunate effect of this 

is that with the death or incapacitation 

of an audit practitioner, the practice 

comes to the end as has happened to me 

twice. The proposed system would be a 

welcome incentive for small practitioners 

to develop accountants for the benefit 

of the profession and the economy as 

a whole. The regime would also ensure 

succession planning in small audit practices 

as collaborating accountants would be 

appointed to take over the practices of 

incapacitated practitioners. This is a very 

important perspective as CPAs have been 

trusted in succession planning for client 

organizations yet they do not practice the 

same. 


Public Policy 

ISSUES OF INTEREST 

Reforming Financial Management 

In The Public Sector 

By CPA Nelson, cpanelson@nfassociates.co.ke 

Strengthening office of the 

Auditor General 

We have noticed significant attention 

being given to security apparatus of the 

country in the past in order to secure 

our borders and maintain law and order 

internally including shutting out oversight 

agencies from policing them- national 

assembly not spared in the guise of 

confidentiality. Under 2010 constitution, 

the office of the Auditor general has 

been given mandate to audit all public 

institutions. In order to discharge this role 

in an effective way, sufficient funds should 

be allocated to protect public interest. 

Eurobond saga is still fresh in our minds 

with over sh215billion still shrouded in 

mystery. The other mega scandal of 1990’s 

was Goldenberg ksh5. 8billion.The funds 

sought will be used to strengthen system 

infrastructure including partnering with 

forensic accountants to deal with mega 

crimes of the magnitude the country is 

witnessing. Kenya’s spending budget has 

grown over the years and now stands at 

ksh2.2 trillion 

Reforming financial 

management system at 

national treasury 

We are all aware National Treasury has 

been undergoing reforms over the years 

in order to deliver a master piece to the 

nation in terms of financial management 

relying in what was put in place by 

colonial treasury and financial orders that 

were put in place by past office holders 

Michuki, Mule, Nganga, Kibinge. There 

was sterling performance during their 

tenure resonating to district treasury and 

agencies. Remember there was no financial 

management act or IAS/IPSAS. 

It is reported that IFMIS was acquired 

and installed at ksh5bllion.It is now time 

we review the effectiveness of the system 

through systems audit as provided for in 

Public Audit Law 2015. Funds should be 

set aside for this mega project to assist 

National Treasury perform its oversight 

role to its agencies. 

Reports from OAG indicates auditees 

are not taking seriously audit reports., 

viewing auditors as enemies putting 

under check their high appetite for 

wasteful spending. Governments need 

to invest in developing their people; the 

most appreciable assets, to protect state 

resources. 

They should be open forums to 

discuss the output of auditor reports 

initiated by principal Auditee-National 

Treasury; targeting all heads of public 

institutions and county governments as 

a demonstration of buy in of challenges 

encountered in the use of public resources. 

This is an avenue with high payoff and the 

government should embrace and allocate 

resources for sustainability of momentum 

of change. 

Opening balances in financial 

statements 

We were made aware that the government 

has no opening balances in their financial 

statements, as echoed by AOG during 

ICPAK Annual seminar this year. No 

lightning will strike in order for this 

to be realized. We have watched this 

glaring omission since 1963.Government 

must invest in modernizing its financial 

reporting system. National Treasury should 

spearhead this exercise beginning 2017- 

2018 fiscal year. This is a mega project 

but it is being suggested at a time when 

Kenya’s resource of accountants stand at 

over 20,000 at hand to help government 

manage change. The government should 

be exhorted to provide funds to manage 

change. 

Strengthening Public 

Procurement Oversight 

Authority (PPOA) 

This is an institution that was established 

following the enactment of the Public 

Procurement Act 2005 Rules 2005 to 


Public Policy 

Government cash systems have locked out commitment 

in form of LSO/LPO from the full glare of the public 

to comprehend the magnitude of the debt load public 

institutions are carrying. Remotely NARC Government 

instituted a committee to validate debts owed to contractors 

for road projects. The exercise was a tip of the iceberg. 

bring sanity to the procurement arena. 

Just like IFMIS, PPOA as an 

institution has been in place for quite a 

while. PPOA is an oversight institution 

and requires urgent review to establish 

its effectiveness. With sh2.2 trillion 

government spending at stake following 

massive fraud, National treasury should 

allocate a sizeable amount of resources 

to power supervision of government 

procurement. and other oversight 

institutions. We must support this 

institution just like AOG and government 

internal audit department. Strengthening 

involves partnering with forensic experts 

and other disciplines to combat mega 

crimes that have brought this nation to its 

knees. 

Validation of trade creditors 

Government cash systems have locked out 

commitment in form of LSO/LPO from 

the full glare of the public to comprehend 

the magnitude of the debt load public 

institutions are carrying. Remotely NARC 

Government instituted a committee to 

validate debts owed to contractors for 

road projects. The exercise was a tip of the 

iceberg. 

Recently the government through the 

CBK approved loan facilities to counties up 

to 5% of audited revenues oblivious of the 

harm the facility does to an unsuspecting 

business community. Public institutions 

have over the years been overrunning 

their budgets and keeping undisclosed 

liabilities running into millions due to a 

flawed financial reporting system, cash 

recognition model familiar with public 

officers to the detriment of an accrual 

system which recognizes unsettled bills 

provided by the business community. This 

is called spontaneous credit as it carries no 

interest. This window of support has been 

abused to the detriment of an unsuspecting 

business community, hence the need to 

look holistically across all public entities. 

It has fuelled indiscipline in the financial 

management system. Validation of trade 

payables as a government project entity 

wise 

Immediate operationalization 

of audit committee 

Considerable resources have been poured 

by government to have a policy document 

put in place to assist public entities grow 

their business to partner with the newly 

energized internal audit department. 

The Internal Audit Department has 

demonstrated that it can deliver a master 

piece without fear of intimidation by 

the executive following the Afya House 

ksh5 billion health expose. In the past it 

has operated as a moribund department 

providing no value to the public in 

safeguarding the public purse. More 

resources should be poured into the 

internal audit department with a proper 

framework for working to boldly expose 

rot in the public service; to assist the 

executive in growing government business. 

The strengthening of internal audit 

department is a recognition of executive 

partnering with a true resource preserver 

coming before the OAG executes its 

constitutional role. 

The department emergence recently 

indicates that war on graft is on course. It 

is gratifying. 



IAESB ISSUES 

Guidance on implementation of a learning outcomes 

approach in professional accounting education 

By CPA Isaac M. Njuguna 

The International Accounting 

Education Standards Board 

(IAESB) is an independent 

standard-setting board under 

the International Federation of 

Accountants (IFAC) that serves the public 

interest by establishing standards in the 

area of professional accounting education. 

These standards prescribe technical 

competence and professional skills, 

values, ethics and attitudes. Through its 

activities, the IAESB enhances education 

by developing and implementing 

International Education Standards (IESs) 

which increase the competence of the 

global accountancy profession and thus 

contributing to strengthened public trust. 

The IAESB is made up eighteen 

board members who are competitively 

selected following nominations by various 

IFAC member bodies from around the 

globe. To support the IAESB’s activities 

are Technical Advisors who actively 

participate and advise the Board on 

various strategic issues revolving around 

professional accounting education and 

development. 

As part of the initiatives to enhance 

the competence of professional 

accountants during the initial professional 

development (IPD) and continuous 

professional development (CPD) stages, 

the IAESB adopted a learning outcomes 

approach both in the development and 

implementation of IESs. The learning 

outcomes approach is broadly based 

on clear achievement of specified 

competencies which are demonstrated 

through a reliable and objective assessment 

or evaluation. 

To this end, the IAESB has issued a 

paper titled Guidance on Implementing 

a Learning Outcomes Approach to act as 

a reference to the IFAC member bodies, 

professional and academic accounting 

examinations bodies including universities 

and other stakeholders with interest in 

professional accounting education. 

The key highlights of the Guidance 

paper are presented below. Additional 

details on the Guidance paper can be 

accessed on the IFAC website www.ifac.org. 

What is a Learning Outcomes 

Approach in professional 

accounting education? 

A learning outcomes approach focuses on 

the individual’s demonstrated achievement 

of the learning outcomes at the targeted 

level of proficiency and not on the learning 

process. Learning outcomes for professional 

accountants are prescribed by a number 

of International Education Standards 

including the following: 

IES 2 – Technical Competence 

IES 3 – Professional Skills 

IES 4 – Professional Values, Ethics and 

Attitudes 

IES 5 – Practical Experience 

Demonstrating the achievement of 

these outcomes provides evidence of the 

professional competence of the individual 

to perform the role of a professional 

accountant. A learning outcomes approach 

embodies the idea that learning and 

development experiences are most effective 

when based on what the individual needs 

to demonstrate. The learning outcomes can 

therefore be used as a framework on which 

to build professional accounting education 

learning and development experiences. 

The Guiding Principles 

The guiding principles for implementing 

a Learning Outcomes approach address 

the following critical areas in professional 

accounting education: 

1. Design 

2. Assessment 

3. Governance 

The above elements are consistent with the 



requirements of the IESs, which include 

achievement of the prescribed learning 

outcomes, regular review and update of 

programs and establishment of appropriate 

assessment activities. 

These guiding principles are further 

explained below: 

(a) Design 

The design of a professional accounting 

education programme is based on the role 

to be performed by the individual. The role 

determines the identification of relevant 

competence areas and learning outcomes. 

The content of and instructional design 

methods used for the programme align 

with the achievement of the identified 

learning outcomes at the desired level of 

proficiency. 

The design of a programme is regularly 

evaluated in response to available 

information on whether it is meeting 

the identified learning outcomes so as to 

continually improve its effectiveness. 

(b) Assessment 

The achievement of learning outcomes by 

the individual is measured and evidenced 

using assessment activities. Assessment 

activities are designed to have high levels 

of reliability, validity, equity, transparency 

and sufficiency. An assessment activity 

involves a comparison of an individual’s 

performance to a defined level, standard or 

benchmark aligned with the desired level 

of proficiency. 

Feedback on the results of assessment 

activities is provided to an individual to 

further their professional development. 

Assessment activities and the defined 

benchmarks and standards are regularly 

evaluated in response to available 

information on whether it is meeting 

the identified learning outcomes so as to 

continually improve their effectiveness. 

(c) Governance 

Organizations responsible for the 

programme continually evaluate their 

programmes to improve their effectiveness. 

Organizational structures and processes 

provide direction and oversight to ensure 

that the guiding principles in the areas of 

design and assessment are monitored. 

The Value Proposition for a 

Learning Outcomes approach 

The implementation of a learning 

outcomes approach will serve the public 

interest by enhancing the development 

of professional competence needed to 

perform a role as a professional accountant. 

A learning outcomes approach integrates 

learning outcomes, programme design, 

assessment activities and governance in 

a process of continuous improvement. 

It embodies the idea that learning and 

development experiences are most effective 

when based on what the individual needs 

to demonstrate. A learning outcomes 

approach therefore provides an effective 

approach to developing professional 

competence - an important objective of 

professional accounting education and 

development. 

An effective programme is critical to 

the development of competent professional 

accountants, strengthening the quality of 

services they provide. This is foundational 

to the trust that stakeholders place in 

professional accountants. It also enhances 

the reputation of the programme provider 

through the learning experienced by the 

individual. 

The investment in implementing, 

maintaining, and continuously improving 

a learning outcomes approach will deliver 

long term and sustainable benefits in the 

public interest, preparing professional 

accountants for successful careers and 

enhancing the success of programme 

providers. 

Further benefits of a learning outcomes 

approach for stakeholders include: 

• Increasing the credibility of the 

accountancy profession 

• Increasing the quality of services 

provided by the accountant 

• Enhancing professional growth and 

confidence for the accountant 

• Providing a higher degree of 

accountability for the programme provider 

and the accountant 

• Potentially improving less effective 

portions of a learning and development 

programme, increasing the time available 

for more critical areas 

• Reducing the reputational risk, 

or improving the reputation, of the 

programme provider. 

Conclusion 

The learning outcomes approach 

can be viewed as part of the broader 

competence based learning model which 

is the preferred learning model in most 

education systems today. For professional 

accounting education, a combination 

of theoretical and practical learning 

environments support the achievement of 

learning outcomes. In addition, the mode 

of testing including the use of case studies 

and scenario based questions enhances the 

realisation of learning outcomes. 

Moving forward, KASNEB and 

ICPAK working jointly are set to 

introduce a Trainee Accountants Practical 

Experience Framework (TAPEF) through 

which students pursuing the Certified 

Public Accountants (CPA) qualification 

will be required to log in their practical 

experience as part of the initial professional 

development. The experience logged in will 

be evaluated at the point of application for 

membership to ICPAK. 

It is also worth noting that the IAESB 

has uploaded on the IFAC website a 

number of examples on good practice in 

the implementation of a learning outcomes 

approach. 

Moving forward, KASNEB and ICPAK 

working jointly are set to introduce 

a Trainee Accountants Practical 

Experience Framework (TAPEF) through 

which students pursuing the Certified 

Public Accountants (CPA) qualification 

will be required to log in their practical 

experience as part of the initial 

professional development. 


Finance and investment 

Geoffrey Odundo, Chief 

Executive of the Nairobi 

Securities Exchange (NSE) 

IMPORTANCE OF 

WORKING CAPITAL ON 

NSE LISTED FIRMS 

By Ndirangu Ngunjiri, operations@watermarkconsultants.com 

Currently several NSE listed 

firms are in the process of 

looking for a strategic investor 

or issuing right issues in order 

to raise the working capital 

level. A positive cash flow from operations 

implies that a firm was able to generate 

enough cash from continuing operations 

without the need for additional funds 

and shall give high returns (dividends) 

to the shareholder. Some firms created 

this through dividends payment freezing. 

A negative cash flow from operations 

indicates that additional cash inflows were 

required for day-to-day operations of the 

firm/s. 

Working capital management is 

investment in current assets and current 

liabilities which are liquidated within 

one year or less and are crucial for a firm’s 

day-to-day operations. This is the money 

needed to finance the daily revenue 

generating activities of a firm. Working 

capital management plays a significant role 

in determining success or failure of a firm 

in business performance due to its effect 

on a firm’s profitability as well on liquidity. 

Companies have been required to 

provide a statement of cash flow as per 

the company’s act. The purpose of the 

statement is to disclose information about 

the events that affected cash during an 

accounting period. The statement looks at 



Firm profitability and the period taken to 

convert inventories to sales and the time 

it takes for firms to pay creditors affect 

the firm’s performance. 

the changes in the levels of cash directly, 

eliminating many of the weaknesses with 

the traditional estimate of cash flow. 

The statement divides company uses 

and sources of cash into three primary 

segments—operating, investing, and 

financing cash flows. The operating cash 

flow segment is designed to measure a 

company’s ability to generate cash from 

day-to-day operations as it provides goods 

and services to its customers. 

Business success depends heavily on 

the ability of CFO’s to effectively manage 

the components of working capital. 

A firm may adopt an aggressive or a 

conservative working capital management 

policy to achieve this goal. For the last 

three years several NSE listed firms had 

liquidity problems and are unable to pay 

their short term financial obligations 

as and when they fell due, consider it in 

terms of efficiency of cash, inventory and 

receivables management. This has heavily 

affected the firms output at the end of the 

financial year, making some companies 

to be put under statutory management 

such Hutchings Biemer andUchumi 

supermarket in 2006. 

Firm profitability and the period 

taken to convert inventories to sales and 

the time it takes for firms to pay creditors 

affect the firm’s performance. Also the 

cash conversion cycle, net trade Cycle 

and inventory turnover in days have a 

significant effect on the performance of 

the firms. 

Efficient management and financing of 

working capital can increase the operating 

profitability of NSE listed firms. They, 

therefore, assert that effective policies 

must be formulated for the individual 

components of working capital. 

Performance of the firms improves 

with adoption of an aggressive financing 

policy, for example Centum have 

improved their performance following 

the dividends payment freezing. Similarly 

the total current liabilities to total assets 

ratio increases the performance improves. 

Use of current liabilities to finance assets 

should be preferable than using long term 

debt (financial leverage), because current 

liabilities are less costly than long-term 

debt. Furthermore an aggressive investing 

working capital management policy affects 

the performance negatively. 

Increasing the proportion of current 

assets in relation to total assets enhances 

performance as measured by both ROA 

and ROE. 



DEVELOPMENT FINANCE 

FOR SMEs, PUBLIC AND 

PRIVATE SECTORS 

How it aids in Developing and 

Emerging Market Economies 

By CPA June Nduku Kivinda, junenduku@gmail.com 

I 

walk into an empty room, and in two 

hours, as the Finance Management 

Consultant with Earnings Nest 

Limited, I will be engaging with 

people from all walks of life; as a 

facilitator training the short term course 

-Finance for Non finance Managers. 

Clients I have interacted with include the 

proprietors of Carzan Flowers (K) Ltd, a 

director from EAGM Ltd (manufacturers 

of Luminarc glassware), partners from 

Daykio Plantations Ltd, Management 

staff from SC Johnson & Son Kenya 

Ltd, a director from Human Resources 

Management Institute(HRM), staff from 

the University of Nairobi MARPs project, 

staff from Kenya Bureau of Standards 

and Jambo pay, Board members of Stima 

Investment Cooperative Society Ltd, an 

engineer being groomed to run the family 

business McBuilder Ltd and many more. 

An area of training that is 

always exciting to tackle is 

Working Capital Management 

When I explain that you can have 

profits but no money in the bank or 

incur losses and have money in the bank, 

the participants are astonished. When I 

indicate to a new venture business owner 

that profits do not equate to salary, I get a 

perplexed look. 

I walked into a full room at Meridian 

Hotel Nairobi on 31st May, 2016. For 

two hours, on a voluntary basis, I engaged 

with participants attending an ICPAK 

event “Financial Management workshop 

for SMEs”. I made a participatory 

presentation on Management of Working 

Capital for SMEs and touched a bit on 

tax planning. Sadly, a common myth in 

the management of working capital is 

that taxation is a monster. A beehive of 

activity ensues, initiating a debate on this 

topic. ICPAK concentrates a lot on IFRS 

for SME events, say the participants, yet 

ICPAK members thirst for more events 

that trigger innovation and creativity 

which can be used to solve practical 

problems SMEs face on a daily basis. 

In both scenarios knowledge is being 

shared to determine working capital 

needs and funding strategies. During 

my reflective moments a thought crosses 

my mind; “Development Finance needs 

Working Capital Management for SME, 

Public and Private sectors in developing 

and emerging market economies”. 

In the Accountant Journal ( July- 

August 2016) CPA Moroa Julius Mwita 

writes;“In Kenya we have had several 

scandals; they include the fall of Uchumi 

Supermarket; currently the closure of 

Kisii branch, closure of some Tuskys 

supermarket outlets, Kenya Airways, 

Mumias Sugar Company, Imperial Bank, 

Dubai Bank and Pan Papers Millers Ltd. 

We have also seen the fall of (Webuye), 



Akamba Bus Services, several community 

financial services that were initiated 

by IFAD and recently Chase Bank to 

mention but a few. Many have been put 

under receivership because of worrying 

working capital/ liquidity position” 

By the way, fellow Accountants, do 

you check ICPAK’s Annual reports for 

ratios like liquidity ratios, as part of your 

information? 

Development started Thirty 

eight years ago 

Incidentally, did you know that ICPAK’s 

first Honorary CPA (HCPA) Former 

President of Kenya Mwai Kibaki and the 

late Tom Mboya issued Sessional Paper 

10 of 1965: African Socialism and its 

application to Planning in Kenya, which 

defined Kenya’s form of economic policies? 

Kenya’s economy in the Kibaki years 

experienced a major turnaround. Many 

sectors of the economy recovered from 

total collapse pre-2003 (Accountability 

Statement. Just 10% of what the Kibaki 

government has done- Government of 

Kenya) 

Numerous state corporations that had 

collapsed during the former President 

Daniel Arap Moi years were revived and 

have begun performing profitably (“The 

Kenya Government-Achievements of the 

2002-2007 Government of Kenya”; Kenya 

information-guide.com Retrieved 1 June 

2010). 

The telecommunications sector 

boomed. Rebuilding, modernization 

and expansion of infrastructure began 

in earnest, with several ambitious 

infrastructural and other projects, such 

as the Thika Superhighway, which would 

have been seen as unattainable pipe dreams 

during the bland and largely stagnant Moi 

years, completed (“What has the Kibaki 

Government done with your money? Truth 

be Told”-Communication.go.ke Retrieved 

1 June 2010) (“Kibaki’s Achievements on 

the infrastructure”. Skynewswire.com 

Retrieved 1 June 2010)- From 1965 to 

2003-that is approximately 38 years. 

Development started Seven 

years ago 

Did you know that International Finance 

Corporation (IFC) plans to inject Kshs 

750 million into PE firm Fanasi Capital 

new fund which is targeting between Kshs 

7.5 billion and Kshs 10 billion for SME 

investment? 

On Friday October 7, 2016 we were 

informed that IFC is making its 2nd 

financing commitment to Fanisi having 

invested a similar amount in the PE fund’s 

initial capital raised in 2010. The 1st fund 

raised was USD 43.5 million (Kshs 4.3 

billion) in 2010 which the PE firm put 

in investments in healthcare, education, 

consumer goods and agribusiness. (www. 

businessdailyafrica.com) 

Accountants, are we able to trace the 

impact of this injection approximately 7 

years later? 

A Homegrown Contribution/ 

Solution 

How can Kenyans in particular and 

Africans in general contribute towards 

Development Finance for the SME, public 

and private sectors in developing and 

emerging market economies? How do we 

embrace Working Capital Management in 

these sectors? Did you know that the MSc 

in Development Finance programme is an 

initiative of the Africa growth Institute 

(AGI) in partnership with a number 

of academic institutions in Africa and 

Europe? 

This programme deals with the main 

issues associated with the finance of 

public and private sectors in developing 

and transitional economies. This interuniversity 

programme in Development 

Finance, therefore aims to ensure that Africa 

and other emerging economies produce 

enough development finance experts to 

meet their growing development needs. 

(A Unique Joint Master’s Programme by 

Prof Nicholas Biekepe – Africa growth 

Institute. 2013)For sustained development 

to be realized, Africans need innovative 

and partnership oriented approaches to 

policy and programmes (Appleton et 

al.2010). 

Was there any University in 

East Africa already playing 

a role in the continent’s 

development agenda? 

The answer is NO. The universities that did 

were based in South Africa and Ghana, 

West Africa; leaving a gap in East Africa. 

I wanted to study MSc in Development 

Finance; the position was; I either go to 

South Africa or find a way to have the gap 

filled in East Africa. “When you move alone 

you move FAST. When you move with 

partners you move FAR. Find the balance.” 

I told myself. The journey began in 2012. 

I contacted Professor Nicholas Biekepe in 

South Africa, approached several Kenyan 

private universities with a proposal and 

When I explain that you can have 

profits but no money in the bank or incur 

losses and have money in the bank, 

the participants are astonished. When 

I indicate to a new venture business 

owner that profits do not equate to 

salary, I get a perplexed look. 

got support from ICPAK Council during 

the tenure of FCPA Benson Okundi as 

chair and FCPA Carol Kigen and CPA Dr 

Patrick Ngumi as CEOs of ICPAK (past 

and current respectively). An MOU was 

signed between KCA University and AGI 

at the main campus in Ruaraka on 7th May 

2014.The MSC in Development Finance 

Programme began at KCA University on 

24th September 2016 - From 2012 to 

2016 that was approximately 5 years. 

In conclusion I would say that the 

number of professional qualifications with 

a definite cause continue to rise; These 

include; Certified Public Accountant 

(CPA), Certified Public Secretaries (CS), 

Certified Information Communication 

Technologist (CICT), Certified Credit 

Professionals (CCP) and Certified 

Investment and Financial Analysts (CIFA) 

Who knows, we may soon have Chartered 

Development Finance Analysts (CDFA) 

in Kenya and East Africa. 


Governance 

IMPORTANCE 

OF CORE VALUES 

IN AN ORGANIZATION’S 

CORPORATE STATEMENT 

‘‘It is the stone that the builder refused to accept, which 

has become the most important stone’ 1 Peter 2:7 

(Psalm118:22), ‘the stone that the builders 

rejected became the cornerstone’ 

By Felix Owaga Okatch, okatchfelix@gmail.com 

Across the world institutions, 

organizations and 

corporations have come 

up with core value 

statements that show 

what they are and how they 

plan to achieve their goals and 

objectives in the short and long 

run. That is achieving their goals 

over time despite global and local 

challenges. They consolidate their 

energies through their respective 

core values and expect stakeholders 

to perceive them favourably. 

This is done through developing an 

organization’s core values. This is what 

an organization stands to achieve. It is 

akin to the foundation stone for a builder. 

In building construction industry, laying a 

foundation is usually the starting point. If it 

is not done right at the start the building is 

bound to fall in future or lean precariously 

like the Leaning Tower of Pisa in Italy. 

When developing core values, the 

number should not be many lest they 

become just general words and statements. 

In most cases the numbers of core values 

range from eight to three. Generally an 

average of five is sufficient. 

We now need to address four aspects of 

core values for organizations to elucidate 

our understanding of the same. This calls 

for our understanding of what core values 

are and their meanings. We also need to 

comprehend how core values are developed 

as 

well. 

As we do 

so we shall 

take into account how the core values 

are used by institutions and conclude by 

illustrating the expected results and way 

forward after developing core values for an 

organization. 

Now for a start we need to elaborate 

why this core value analysis is important. 

Core values at the start are the prologue 

and a binito of company analysis of 

direction to its goals in business. It is 

the second step of corporate or company 

vision and mission statements. It puts in 

place thoughts of employees, management 

and board and the goal congruence of an 

organization’s strategic direction. Since it 

is developed by all, it gives direction and 

communication within and outside 

the organization. Core values assist 

the organization to move towards 

a strategic goal post. Without 

asserting energies and values 

towards a strategic direction, an 

organization is bound to fail. 

Core values do assist in creating 

a value statement that must be 

owned by all. Core values when 

known by all staff and owned by 

many will guide the organization 

from engaging in diversionary 

environmental temptations and 

distractions. It is important to ensure 

that boards, management and staff are 

able to get involved jointly and severally 

in preparation and ownership of company 

core values. 

Let us now explain how core values should 

to be used by organizations; 

All employees, staff, management, and 

the board need to be disciplined to focus 

on core values. Since all were involved in 

developing the core values, there needs 

to be focus and attention to the success 

of achieving the objectives of core values. 

Generally the core values need to be less 

than five and easy for company internal 

users to internalize. The staff must know 

that core values are important and depict 

what an organization cannot do without. 

It must be noted that it takes time to 


Governance 

develop and own core values. It is not just 

a matter of copy paste and hope to get it 

right. It must also be emphasized here 

and now that if the matter of core values 

is not got right the first time, then the 

whole edifice of an organization will fall in 

the long run. It will be akin to the builder 

who neglected the importance of laying 

a strong foundation stone at the starting 

phase of construction. 

Generally core values need to be 

elaborated and displayed in organizations’ 

reception areas, offices, annual report 

of accounts and other public boards. 

Examples of core values statements could 

be as follows: 

• Client Success; partnering with clients 

• Being ethical; always honest internally 

and with stakeholders 

• Objective; being objective to ourselves 

and stakeholders 

• Innovation; embracing technology 

between ourselves and among our clients 

• Striving excellence; continuous 

attainment of new knowledge abilities, 

enhance performance of our products and 

services. 

Now let us elaborate on how to develop 

core values. We need to understand that 

it is a corporate tragedy if an individual 

or a consultant sits down and writes core 

values for an organization alone. If it is 

not developed by all concerned, and not 

owned by them, then it is just a piece of 

paper, not core values. 

In an organization, all employees, 

staff, management and board must 

have a joint meeting or workshop to 

develop core values. Sometimes it is done 

democratically or ranking suggested 

values until a consensus is achieved. This 

means that the parties concerned must 

soul search and question one another 

exhaustively before they agree on core 

values which truly represent their situation. 

An organization needs to question itself 

thoroughly. The staff, management and 

board must read from the same script. 

When there is uniformity, the core values 

so developed can weather the storm of 

exogenous environmental challenges. 

Otherwise it will not be able to survive 

in the storms, vagaries and earthquakes of 

global mismanagement disasters. 

The uses of core values are that it 

illustrates what all staff; management 

and board have agreed upon and stand by. 

When it is owned, once again, it needs to 

be pasted in company reception area and 

annual accounts and at company functions 

in gondola boards. It needs to be akin to 

a song and choir of the organization. 

Normally when all stakeholders sing the 

same tune, even setting a chorus becomes 

easy. Dancing steps begin to fall in place 

like music that flows in crescendo, good 

tempo and the lot which goes with 

uniformity. This is what core values are all 

about. 

In conclusion, the core values are 

cornerstones of strategic direction. They 

respond to and support a company’s vision 

and mission. They serve as pillars in good 

corporate governance practices. 

NB; Views expressed herein are personal 

and do not have any bearing directly 

or otherwise with any institution in 

general or in particular where I serve as 

a director, council member or consultant. 

This presentation is made for academic and 

educational purposes only. Any injury to 

third a third party is regretted since it was 

not intended to be so. 


Economy 

DERIVATIVES 

Hedging with the new 

NSE 25 Share Index 

By Samuel Kiragu, samkiragu@gmail.com 

Nairobi Securities Exchange 

(NSE) is gearing up for the 

introduction on derivatives 

financial instruments 

trading. NSE will start 

trading in stock index futures. 

Accountants will be required to 

have an insight on how to account for 

derivative instruments and hedging 

activities. Before looking at basics of 

accounting for derivatives and hedge 

accounting, it is important to understand 

the mechanics of derivatives. This is the 

first series of derivatives articles. The next 

article will look at the basics of accounting 

for derivatives. 

In daily financial news, we routinely 

hear about the performance of Nairobi 

Securities Exchange. This up and down 

movement is measured using the Nairobi 

Securities Exchange Index. This Index is 

computed on a continuous basis during 

the day and reported to the public once 

the market closes. The stock markets 

experts have devised a way of trading on 

these insights through stock index futures. 

Investment pundits normally use these 

futures to speculate and also to hedge 

various kinds of portfolio risks. 

NSE recently launched a new index; 25 

Share Index .This index is composed 

of 25 companies most of them from 

financial services sector. The new index 

lays foundation for the new alternative 

investments and derivative products. 

These are equity based future derivatives 

and Exchange Traded Funds (ETFs). 

There are two types of equity based 

future derivatives namely stock index 

futures and single stock futures. Stock 

index future is a derivative that has the 

underlying commodity of a basket of 

stocks that make up the index. It’s used to 

hedge against loss of a portfolio of stocks. 

Single stock future on the other hand has 

a single stock as an underlying and it’s 

used to hedge on a single particular stock. 

NSE will start trading on stock index 

futures. 

Speculating with stock index 

futures is very exciting but even more 

thrilling is hedging a basket of portfolio 

of investments using index futures 

derivatives. As such we will first engross 

ourselves on how to hedge against price 

volatility in the market stock using index 

futures. 

Consider Paul, a portfolio manager 

at Loita House Investment Bank. He 

has a well-diversified stock portfolio of 

Kshs 50,000,000. We can assume that 

his portfolio has a beta of 1.2 meaning 

that a movement of 1 percent in NSE 25 

Share Index will result in 1.2 changes in 

Paul’s stocks portfolio. The reason why 

Paul’s portfolio movements will be higher 

than the NSE index is because he may 

be having some more volatile stocks in 

his portfolio that are not included in the 

NSE 25 Share Index. For now, don’t be 

overwhelmed by beta, it will make sense 

when we apply it momentarily in our 

hedging equation. 

With the current Kenyan economic 

crisis, Paul fears that stock prices will 

significantly decline in a near future i.e. 

bear market is approaching. He wants to 

hedge his portfolio against this adverse 

possibility. 

Paul has two options. He can sell all 

the stocks now and put that money in T- 

bills. After the bear market, he can get the 

funds back from T-Bills and put it back 

to stocks. This would be cumbersome to 

say the least. Liquidating a portfolio of 

Kshs 50m will be not be easy. This strategy 

may also end up being expensive due to 

transaction costs involved like brokerage 

fees. 

Short Hedge 

The best strategy that Paul can implement 

is to use a short hedge if he is of the 

opinion that the stock market will be 

bearish over a short period of time. Index 

future contracts mature on quarterly basis 

and as such they may not be suitable for 

hedging prolonged bearish market. They 

can be liquidated any time before they 

mature since they are tradable in stock 

exchange. 

He will go short (sell) NSE 25 Share 

Index future contracts. By selling these 

futures contracts, he will lock the current 

favorable monetary value of the future 

index. 

The first step Paul will take is to 

determine the value of stocks at risk. In 

our case, we know the value is Kshs 50m. 

The second step will be for him to take an 

opposite position in the futures market 


Economy 

Speculating with stock 

index futures is very 

exciting but even more 

thrilling is hedging 

a basket of portfolio 

of investments 

using index futures 

derivatives. As such 

we will first engross 

ourselves on how to 

hedge against price 

volatility in the market 

stock using index 

futures. 

using NSE 25 Share future Index. Paul’s 

expectation is that the losses that will be 

incurred by the portfolio of stocks as a 

result of the price falls will be offset by the 

gains in the index futures. 

This is how index future hedge will 

work assuming that he wants to go 

short (sell) NSE 25 Share Index future 

contracts on Nov 4 when the index closed 

at 4,002.96. 

One point to bear in mind is that an 

index in itself only tells us about the stock 

markets movements but nothing about 

money value. We will assume that the 

index has been assigned a monetary value 

of Kshs 100 for each point movement. 

Therefore, the cash value of the index 

as of Nov 4 is 4,002.96*Kshs 100= 

Kshs 400,296. Index multiplier is what 

derivatives pundits call the Kshs 100. 

Armed with Cash value of the index of 

Kshs 400,296, Paul should now calculate 

the number of contracts he needs to 

hedge his portfolio of Kshs 50m worth of 

stocks. This will be calculated by dividing 

his total portfolio of Kshs 50m by the 

cash value of the index; Kshs 50,000,000/ 

Kshs 400,296 = 124.9 contracts. These 

contracts are adjusted by multiplying with 

beta of 1.2 to give 149.9 contracts. The 

industry practice is to round down the 

number of contracts to 149. The reason 

you are adjusting with beta is because 

Paul’s portfolio may end up being slightly 

more volatile than the future index. 

Now that Paul knows the number of 

contracts required to hedge his portfolio, 

he will initiate the hedge on Nov 4 by 

selling (going short) 149 contracts against 

the Kshs 50 million stocks portfolio. 

By Dec 16, his fears have been realized 

and NSE 25 Share index and the futures 

have both fallen by 5% to 3,802.81 

points thus losing 200.15 points (Nov 4 

index of 4,002.96 minus Dec 16 index of 

3,802.81). 

The stock index future realizes profit 

of Kshs 2,982,205 calculated as follows 

(200.15 index points*149 contracts*Kshs 

100 per point).This is a profit because 

Paul is selling these contracts at higher 

index that he locked them on Nov 4.He 

entered into a future contract on Nov 4 to 

sell the underlying at a higher index than 

it is worth today. 

Let’s now look at the loss/hit that Paul 

will incur as a result of fall in stock prices in 

his portfolio.He will lose 5%*50,000,000= 

Kshs 2,500,000.This loss is offset by the 

hedge profit of Kshs 2,982,205 realized 

from hedging! Thus, Paul makes a profit 

of Kshs 482,205 (The difference between 

hedge gain of Kshs 2,982,205 and 

portfolio loss of Kshs 2,500,000). His 

hedge is termed as effective since he is 

making money. The hedge would have 

been termed as ineffective if he took a hit/ 

loss. 

Normally the profits or losses on 

future positions are paid daily based 

on the index movement. Positions are 

marked to market and profits or losses are 

crystallized daily. What this means is that 

if the position losses money during the 

day, the losses must be paid on that day. 

If the position is in profit, a payment will 

be received that day. These payments are 

called variation margins. 

In our example we have assumed that 

the profit of Kshs 482,205 is paid in one 

block on contracts delivery. 


WORK PLACE 

WHERE IS YOUR ORIGIN? 

By Anne Njagi 

Indeed, you are popular. It is amazing 

how addicted we are to you. While it 

is said that everything is in the mind, 

majority of us cannot execute our 

duties without consuming you, from 

time to time, every day. 

It is also said that your origin is a 

significant culture dating back to 14 

centuries ago. One school of thought 

says that you were discovered in Ethiopia 

and another in Yemen. The most popular 

legend goes like this…An Abyssinian goat 

herder from Kaffa, was herding his goats 

through a highland area near a monastery. 

He noticed that the goats were behaving in 

a very strange way on that particular day. 

They jumped around in such an excited 

manner, whining loudly and practically 

dancing on their legs. 

“Why would this happen”? He asked 

loudly as he thought he was not in his 

real senses. “The gods must be crazy”, he 

shouted as he sought to know the source 

of this weird behaviour by the goats, by 

getting closer to them. For a moment, 

he stood still and dumbfounded trying 

to figure out why such 

a scenario. He then 

discovered that the source 

of the excitement was a 

small shrub with bright 

red berries. Curiosity 

took hold and he tried the 

berries himself. Just like his 

goats, he felt energized. He 

quickly filled his pockets 

with the red berries, rushed 

to his wife at home and 

shared his experience. She 

was astonished and advised 

him to share the news on the 

‘heavenly berries’ with the 

nearby monastery which he 

did. 

Upon arrival at the 

monastery, the news of this 

new discovery was not received 

well; one of the monks in 

anger literally threw them into 

the fire. However, according 

to the legend, the aroma of 

the roasting beans got more 


WORK PLACE 

and more appealing until the 

monks decided to give this 

novelty a second chance. They 

removed the berries from 

the fire, crushed them to put 

out the glowing embers and 

covered them with hot water 

in a pot in order to preserve 

them. After this, all monks 

smelled the aroma, tried it 

out for some days and found 

the concoction’s uplifting 

effects were beneficial in 

keeping them awake during 

their spiritual practices. 

From then on they vowed 

they would drink this 

newfound beverage each 

day. 

This is coffee 

While there are many 

schools of thought as far 

as coffee consumption 

is concerned, there is a 

belief that it increases productivity at work 

place. Many organizations have therefore 

invested on coffee makers in the office 

while a number of employees have also 

attested to it that each sip comes with 

more energy thus increasing productivity. 

It is common to hear phrases such as 

“Let’s discuss this over a cup of coffee. 

Nevertheless, the parties concerned 

may not necessarily take coffee during 

the meetings. However, the question of 

whether there is an increase of productivity 

as a result of coffee consumption is 

debatable. The question of its effectiveness 

towards productivity has no concrete 

answer and differs from one individual to 

the other. 

This notwithstanding, it is a fact that 

coffee is the most commonly consumed 

beverage in the workplace and has become 

an integral part of workplace culture. Both 

at work and other social places the phrase 

“let’s have a cup of coffee” has been taken 

to mean….”let’s have a conversation”. 

This is believed to increase creativity and 

innovation. 

It is said that when consumed in 

moderation, caffeine has positive effects 

which include being alert. However, it is 

key to note that again this is very personal 

and may differ from one individual to 

another. According to Entrepreneur.com, 

stress in the workplace is rife. Stress costs 

result in lost productivity, higher health 

costs, errors, interpersonal conflicts and 

poor morale. Nearly half of all workers 

suffer from some degree of stress. 

Coffee breaks are one of the best ways 

to help employees deal with stress. While 

this can be abused, stepping away from the 

desk for 15 minutes helps your brain to 

relax and caffeine increases hormone levels 

that can improve mood, energy level and 

cognitive performance. 

White or black coffee? 

Again, this is dependent on your choice. 

At a coffee corner in an office, a member 

of staff was over-heard saying how the 

first sip of coffee in the morning gives an 

exhilarating moment of fulfilment, simply 

beyond words. 

Conclusion 

Today, the importance of coffee to the 

world economy cannot be overstated. 

Coffee is crucial to the economies of 

many developing countries with exports 

accounting to more than 50% of their 

foreign exchange earnings. Over 90% of 

coffee production takes place in developing 

countries. 

Coffee is not just a drink. It’s a global 

commodity. Over 2.25 billion cups of 

coffee are consumed in the world every 

day. As one of the world’s most traded 

products only second in value to oil, the 

coffee industry employs millions of people 

around the world through its cultivation, 

processing, trading, transportation and 

marketing; providing employment to 

hundreds of millions of people worldwide. 

But while the coffee trade is vital to 

the survival and economies of many 

developing nations, the industry’s pricing 

and contracts are unfortunately decided in 

conference rooms and on stock exchange 

floors in some of the world’s wealthiest 

cities. 


INSPIRATION 

THE POWER OF 

A WRITTEN PLAN 

By Angela Mutiso, cananews@gmail.com 

It May Turn Out To Be the Best 

Investment You Will Ever 

Make 

Whenever Mary’s husband Mutinda calls 

her for a meeting away from home, she 

often gets a feeling that he is nagging 

her because he tends to start by trying 

to establish if she has a written plan for 

her business. This is something she hasn’t 

got round to doing despite his constant 

reminder. Given that her husband is a 

workaholic, they have an arrangement 

that they should meet outside their house 

for any matters that sound even slightly 

official; and Mary, according to Mutinda, 

has erroneously classified the business plan 

discussion as one of them. The forty-seven 

year old mother of two is not convinced 

that having a written plan can make her 

work better. Mutinda however persists as 

he views, the obligation to educate her 

with special lessons he has learned during 

his long time in business as part of his 

mission. 

Come to think of it, do we really need 

to have a written plan? It seems okay 

doesn’t it; just to know what we want out 

of life and get on with it. Why should you 

have a written business/life plan? What is 

it exactly? A life plan is a formal, written 

plan you can use to plan out areas of your 

life including career, where you live, who 

you associate with, and how you spend 

your time. Writing out a life plan can help 

you identify areas of your life that you 

would like to change or to meet certain 

goals. A life plan may help you see your life 

in a different way. Seeing aspects of it on 

paper may help you prioritize and readjust 

your ideas. Putting a life plan down on 

paper may also help you see similar goals 

and desires you have, or adjust your plan 

based on things that don’t fit. (Wiki) 

Writing about the power of 

a written plan, Dan Mcarthy - 

(Greatleadershipbydan); says he has 

always been a strong proponent of the 

importance of having a written individual 

development plan (IDP) for Leadership 

development. This is, identifying: What 

you want to get at; how you are going to 

do it; when you are going to do it. He says 

he has one, makes sure his employees have 

one, and tries to encourage all employees to 

have one, not just managers. The idea notes 

Mcarthy, is often met with resistance, and 

when he conducts workshops on how to 

develop as a leader, when he is coaching a 

leader, he usually gets pretty buy-in until 

they get to the point where it’s time to 

put it in writing; which is the moment 

of truth; time to make a commitment. 

For some, picking up that pen is met with 

staunch resistance. 

Mcarthy gives the example of an 

article derived from the Harvard Business 

School goal story. It is a story he read that 

convinced him of the power of having 

written goals. He uses it sometimes to 

try to get people out of this obstacle- he 

reports; in the book What They Don’t 

Teach You in the Harvard Business School, 

Mark McCormak tells a study conducted 

on students in the 1979 Harvard MBA 

Program. In that year, the students 

were asked, ‘have you set clear, written 

goals for your future and made plans to 

accomplish them?” Only three percent of 

the graduates had written goals and plans; 

13 percent had goals, but they were not in 

writing; and a whopping 84 percent had 

no specific goals at all. 

Ten years later, the members of the 

class were interviewed again, and the 


INSPIRATION 

Businesses without a 

plan can easily get offtarget, 

and revenues 

will suffer as a result. 

Creating a plan with 

expense projections, 

revenue forecasts, 

and more can help a 

small business remain 

committed to its longterm 

goals.” 

findings, while somewhat predictable, were 

nonetheless astonishing. The 13 percent of 

the class who had goals were earning, on 

average, twice as much as the 84 percent. 

Who had no goals at all. What about the 

three percent who had clear, written goals? 

They were earning, on average, ten times 

as much as the 97 percent put together. 

He notes that while this story is about 

financial goals, the same concept applies 

to leadership development goals. You can 

sit back and float through life hoping 

you’ll get better as a leader. And if you are 

lucky, you will. Development will come to 

us. But why not increase your chances to 

success ten times simply by putting your 

development goals in writing? It’s the best 

investment you will ever make concludes 

Mcarthy. . - Dan Mcarthy is the owner of 

Great Leadership, LLC and the Director 

of Executive Development Programs at 

the University of New Hampshire. He is 

the author of the award winning leadership 

development blog ‘Great Leadership and 

an influential voice in social media. 

Andrew Schrage, of more Money Crashers 

Personal Finance whose mission is to 

develop a community of people who try 

to make financially sound decisions. (The 

website strives to educate individuals in 

making wise choices about credit and debt, 

investing, education, real estate, insurance, 

spending) says the biggest reason to 

write out a business plan regardless of 

any financing option concerns is that it 

can help you stay organized and remain 

on track. Businesses without a plan can 

easily get off-target, and revenues will 

suffer as a result. Creating a plan with 

expense projections, revenue forecasts, and 

more can help a small business remain 

committed to its long-term goals.” 

Following are The 11 Indispensable 

Principles of Money Crashers 

• Always spend less than you make. 

• Do not believe in money myths. 

• Get out of debt and stay out of debt. 

• Save money for the unexpected. 

• Student loans are not the only answer. 

Be resourceful and open-minded. 

• Find creative ways to boost your 

income. 

• Invest for the long-term and keep it 

simple. 

• Educate yourself about real estate, cars, 

and financial products. 

• Avoid scams and financial predators. 

• If you have a spouse or partner, treat 

this person as a teammate! 

• If you achieve financial success, give 

back. It helps others and feels great. 

Creating a purpose for your life and 

following it through is a big march into a 

great future. Discussing how to plan your 

life, Wiki says; you can decide what you 

want, find out what’s important to you, 

and create a plan to follow so you make 

the most of your life. The most important 

thing here, they suggest is that you clarify 

your vision. This can be an overwhelming 

task, but it simplifies matters for you when 

you write it down. You need to look at all 

areas of what is fulfilling and meaningful to 

you. Some questions to start you thinking 

about which direction you want your life 

to go include: What does success look like 

to you? Is it a certain job title, or amount 

of money? Is it being creative? Is it having 

a family? What would your life look like 

if you had the power to change it right 

now? Where would you live? What would 

your career be? How would you spend 

your time? Who would you spend your 

time with? Whose life do you admire? 

What course of their lives makes it 

appealing to you? 

You should construct 

a guiding vision 

statement; and once you have explored 

what is meaningful to you through 

questioning and self-reflection, write 

down the answers you came up with in a 

sentence you can use as a guiding vision 

statement. Write it in the present tense, 

as if you’ve already accomplished it. Your 

plan may not go in a straight line, it is 

full of twists, move slowly and learn from 

those experiences as you move closer to 

your goal. You may run into dead ends in 

your life. You may end up with a job you 

think will put you in a better place, but it 

leads nowhere. You may get sidetracked by 

relationships and family. Just remember 

there is no timetable. Keep making small 

progress towards your goals and learn from 

every dead end and new development in 

your life. 

You should be prepared to create your 

own opportunities: There may not be the 

perfect job, place, or opportunity already 

out there. If this is the case, you’ll need to 

create that opportunity for yourself, even if 

doing so wasn’t a part of your original plan. 

Understanding as you plan your life that 

you may have to make your goals happen 

can help mentally prepare you for any 

changes down the road. 

In order to thrive in any facet of your 

life, you have to plan and write out your 

objectives. By doing this, you will boost 

your personal growth which in turn will 

make you flexible and creative. It will 

reduce your stress level and enable you to 

have a road map which you can follow for 

your success. That is why to do lists are 

written even on a daily basis. 

Writing a plan is a useful tool many 

successful people use to boost their chances 

of success. By doing this, you become 

focused, motivated, organized and 

victorious. Veteran businessmen 

like Mutinda, know why it 

is important for his wife, 

employees and anyone who 

seriously wants to succeed 

in life should apply this 

simple principle. It is 

the secret to success. 


HEALTH 

DISCOVER YOUR 

ALLERGY TRIGGERS 

By Angela Mutiso, cananews@gmail.com 

ACEO of a thriving 

organization could not 

work out why every time he 

stepped into the bookstore 

in their premises, he would 

sneeze non-stop a number of times before 

catching his breath again. He soon found 

out that he was allergic to something in 

the area and immediately took necessary 

steps to establish and eliminate the cause. 

It did not take long before the head of 

the company was informed that there 

were dust mites in the room. Allergies can 

make you quite miserable; especially if you 

do not know where they are, what causes 

them and how to keep them at bay. 

An allergy is the response of the body’s 

immune system to normally harmless 

substances such as pollens foods, and house 

dust mite. While in most people these 

substances (allergens) pose no problem, in 

allergic individuals their immune system 

identifies them as a ‘threat’ and produces 

an inappropriate response. - AllergyUK. 

org 

Everyday health explains that avoiding 

allergies may be easier than you knew; 

whether you have indoor allergies to dust 

and mold or hay fever caused by pollen, 

allergy symptoms can be equally miserable 

all year long. It points out that coughing, 

sneezing, itchy eyes, and a runny nose can 

make any day a challenge. An estimated 

40 million Americans have indoor and 

outdoor allergies. Although there is no cure 

for most allergies, the situation is far from 

hopeless. “In addition to treatment, the 

best way to fight allergies is to learn ways 

to avoid them,” says Sandra Hong, MD, an 

associate staff member in the department 

of pulmonary, allergy, and critical care 

medicine at the Cleveland Clinic in Ohio. 

Here are 10 simple tips from everyday 

health that can help - excerpts; 

• One of the biggest causes of indoor 

allergies is the dust mite. These microscopic 

insects love to live on your bedding and 

stuffed animals. Hong advises washing all 

of your bedding in hot water and drying it 

in a hot dryer to kill dust mites. 

• An estimated 35 million Americans 

experience hay fever caused by wind-borne 

pollen or mold spores. Wearing sunglasses 

outside can reduce the amount of pollen 

or spores that get into your eyes. Allergyirritated 

eyes are also more sensitive to 

sunlight, so stylish shades may help your 

eyes feel better, too. 

• “Indoor houseplants that flower aren’t 

likely to cause a pollen allergy, because 

most flowering plants are pollinated by 

insects,” Hong explains. “But indoor plant 

soil can let plenty of mold spores into your 

house.” If you have hay fever or a mold 

allergy, keep houseplants to a minimum 

and definitely keep them out of your 

bedroom. 

• Hay fever is also known as seasonal 

allergic rhinitis, because pollens tend to 

be worse in specific seasons when trees, 

grasses, and weeds pollinate. If you can 

identify your trigger season, you may be 

able to avoid the worst pollen exposure by 

getting out of town for at least part of it. 

• Mold thrives in moisture. To help 

control indoor mold, use a dehumidifier 

or your air conditioner to keep your home 

humidity close to 50 percent. If you take 

a road trip when the pollen count is high, 

make sure to keep your car windows closed. 

• If you can, travel early in the morning 

or in the evening. Windows, curtains, 

and blinds are the preferred hiding places 

for dust and mold. These indoor allergy 

culprits can also set up shop in poorly 

ventilated laundry rooms, basements, 

refrigerator drain pans, and old books. If 

you have an allergy to cleaning products 

in addition to the mold and dust, wear a 

mask, and get out of the house for a few 

hours afterward to let the air clear. 

• Take some simple precautions to keep 

outdoor pollens out of your home. Wear a 

mask if you work outside, and remove your 

work clothes before entering the house. 

It’s also good to shower right after coming 

in from yard work. When you do laundry, 

use a dryer instead of hanging your clothes 

outside. Leave all windows in the house 

closed during allergy season, and rely on 

your air conditioner or dehumidifier to 

help protect you from indoor allergies. 

• If you have outdoor or indoor allergies, 

any substance that irritates your airways 

can make your symptoms worse. Do not 

smoke in your home, kindly ask house 

guests to smoke outside, and avoid wood 

fires and wood-burning stoves. Strong 


HEALTH 

odors can also set off an allergy attack. 

• Studies have shown that cockroaches 

are a surprisingly common cause of indoor 

allergy symptoms and asthma, especially 

in children. Remove water and food 

sources that may attract cockroaches, and 

if you see a cockroach, get professional 

help. “That goes for rodents, too,” says 

Hong. 

• If you or someone in your family is 

struggling with indoor allergies or hay 

fever, talk to your doctor. 

Meanwhile, Kimberly Snyder says 

in her blog on allergy vs. Intolerance 

that according to the Mayo Clinic, 

approximately 6 to 8 percent of kids under 

age 5 and about 3 to 4 percent of adults 

suffer from true food allergies. If this 

number seems low given the number of 

people you know that suffer after eating 

certain foods, then you may be making a 

common misidentification. While only 

a small percentage of the population has 

actual food allergies (which can be life 

threatening), many, many others suffer 

from food intolerances. Symptoms of food 

intolerance include: headaches (including 

migraine) Irritability, mood swings, or 

nervousness, digestive upset, heartburn, 

depression, Inflammation, mucus and 

respiratory problems. Other symptoms 

are autoimmune disease, muscle and joint 

aches, difficulty sleeping, exhaustion and 

lack of energy. In addition, there is weight 

gain or difficulty losing weight, skin 

disorders, heart palpitation or arrhythmia. 

Dairy products, eggs, tree nuts, wheat and 

shell fish and some types of fish are also 

know to belong to the food groups that 

cause at least 90 percent of all true food 

allergies. 

What to Do 

Try as best you can to avoid most of these 

foods, Kimberly Snyder asks: Do you 

suspect you have food sensitivities? The 

good news is that you can grow healthier 

by eating a nutritious diet, cleansing, and 

noting your body’s reaction to certain 

foods. She says briefly that you can 

beat food sensitivities if you eliminate 

processed foods. Instead, focus on a natural 

plant-based diet consisting of organic 

fruits and vegetables, as well as whole, 

non-gluten grains. Drop the dairy. She 

points out rather interestingly in her blog 

that humans were meant to ingest breast 

milk, not cow’s milk, and only for the first 

year or two of life. After that, dairy has 

no place in a human diet. Calcium can be 

found in other foods. Furthermore, foods 

such as dairy which have an acid-forming 

affect actually encourage the leaching of 

calcium from the body via urinary calcium 

excretion. (Read more on this in The China 

Study). Also Avoid gluten grains. Instead, 

eat grains like quinoa, millet, oat groats, 

and buckwheat. Avoid vinegars, except 

for raw apple cider vinegar. Avoid animal 

proteins. If you do eat animal proteins, opt 

for minimally processed, local, grass-fed, 

organically farmed animal products raised 

without antibiotics or hormones. 

Top Allergy Kit Must-Haves 

Shut out breezes. Keeping indoor air free 

of your allergy triggers can help ease nasal 

symptoms; consider alternative therapies; 

wash away allergens; wear a mask; eat a 

healthy diet; use a nasal rinse. ; drink more 

fluids; learn how to clean safely (webmed). 

One is advised to see a doctor when 

they are dealing with an illness, however 

consumerreports.org says the following 

drugs may be useful in dealing with 

allergies: - allergy shots, antihistamines 

(pills, eye drops, and nasal sprays), 

cromolyn, leukotriene blockers, and nasal 

steroid sprays. Hey focus here on secondgeneration 

antihistamine pills and nasal 

sprays, such as Allegra, Clarinex, Claritin, 

Xyzal, and Zyrtec. But, nasal steroid sprays 

such as fluticasone propionate (Flonase), 

mometasone furoate (Nasonex), and 

triamcinolone acetonide (Nasacort) are 

considered by experts the best, first option 

for seasonal allergies. Both flonase and 

Nasacort are recently available without a 

prescription. One downside is that it can 

take hours or even days before they start to 

work. And the steroid sprays must be used 

consistently to get the greatest benefit. 

Because of that, some allergy sufferers may 

choose instead to take one of the secondgeneration 

antihistamine medications. 

(consumerreports.org). 

So, it is necessary for you, as an allergy 

sufferer to take control over the food you 

eat. Either make a list or track of the foods 

you are allergic to and make sure you do 

not include them in your diet. Consume 

foods that you have no trouble with and 

let them be as natural as possible. As often 

as possible, cook your own food and when 

you go to restaurants, ensure that the 

ingredients included in the food you are 

going to eat, agree with your system. In 

addition, carry your own home made food 

to work so you do not have to go through 

the stress of eating food that your body 

cannot take. Ensure your surroundings 

especially places you spend a lot of time 

in like your house and office are dust free 

and are cleaned regularly. This way you will 

be able to have peace and fewer allergy 

attacks. 

Health Tips 

The wonders of water melon 

This magical fruit/vegetable 

can aid in Kidney disorders, 

inflammation, bone health, nerves, 

blood pressure reduction, scurvies, 

wounds, macular degeneration, 

heart health, cell damage, erectile 

dysfunction and heat stroke. It 

also aids in hair loss, weight loss 

and digestion among many more. 

• Frosty cold – sweet water melon 

pieces are popular throughout the 

year 

• Watermelons are mostly water 

— about 92 percent — but this 

refreshing fruit is loaded with 

nutrients. Each luscious bite has 

considerable levels of vitamins 

A, B6 and C, lots of lycopene, 

antioxidants and amino acids. 

• Watermelon can help combat 

the formation of free radicals 

known to cause cancer. 

• Watermelon Juice May Relieve 

Muscle Soreness 

• You Can Eat Watermelon Rind 

and Seeds; Not only does the 

rind contain plenty of healthpromoting 

and blood-building 

chlorophyll, but the rind actually 

contains more of the amino acid 

citrulline than the pink flesh 

• Watermelon Extract May 

Significantly Reduce Blood 

Pressure 

• Watermelon for Inflammation, 

Sexual Health, and More; 

L-arginine may also help with 

erectile dysfunction by helping 

to relax your blood vessels, 

including those supplying blood to 

your vital organ – and that’s why 

watermelon is sometimes referred 

to as “Nature’s Viagra.” (Additional 

tips by mercola and well-being 

secrets) 


ENVIRONMENT 

SUCCESSFUL ENERGY 

MANAGEMENT 

By Staff writer, anthony@grsurveyors.com 

Projects that cut energy 

costs should be compared on 

a rational basis with other 

investment opportunities 

Any organization needs good management 

for long-term success and efficient 

operation, and energy management is no 

different. However, the management of 

energy is often neglected, even though there 

is considerable potential to save energy 

and reduce costs. At the same time, there 

is increasing pressure from rising energy 

prices, climate change legislation and the 

need to be seen to be environmentally 

responsible by customers and stakeholders. 

Saving energy makes business sense, 

and having a structured, co-ordinated 

and integrated approach maximizes 

these benefits. Without good energy 

management, cost-effective opportunities 

can be easily overlooked. Like all 

management disciplines, energy 

management should be applied in a manner 

appropriate to the nature and scale of the 

organization. Energy management for a 

small office-based organization will be 

at a very different level from that for a 

complex industrial company with a multimillion 

pound energy bill. Nevertheless, the 

fundamental principles are much the same. 


ENVIRONMENT 

Energy management is the systematic 

use of management and technology to 

improve the energy performance of an 

organization. To be fully effective it needs 

to be integrated, proactive and incorporate 

energy procurement, energy efficiency 

and renewable energy. Putting an energy 

management system in place takes time 

and it will continue to develop as energy 

performance improves and attention 

moves to different issues. The points below 

illustrate the main elements of energy 

management and the different stages of 

development. 

It is important to determine:- 

• The current position 

• Management Review 

• Action Plan 

• Energy Policy 

• Senior Management Commitment 

• Energy Strategy 

• Initial Review 

• Organizing Compliance Investment 

Procurement Energy information 

Opportunities identification 

Organizational culture Communications. 

Energy management system 

An energy management system refers 

to a documented procedural system. 

Organizations can have their energy 

management system certified to a 

recognized standard, of which the 

main example is ISO 50001 Energy 

Management Systems. The structure is 

similar to the ISO 14001 Environmental 

Management Standard in providing a 

framework and enabling a systematic 

approach for continuous improvement 

of an organization’s energy efficiency and 

sustainable use. However, where with 

health and safety there are legal obligations 

on all employees, energy efficient behavior 

is more appropriately driven through 

developing an energy efficient culture. 

Organizing energy 

management 

Led by the Energy Manager, the energy 

management team has responsibility for 

the day-to-day delivery of the energy 

policy through the implementation of the 

energy strategy. There is no ideal model 

for an energy management team –the 

structure will depend upon how your 

organization works. Where the members 

of the team have other duties what is 

important is that they have sufficient 

time, expertise and resources to perform 

their energy management responsibilities 

effectively. 

Formal responsibility for energy 

management should not reside exclusively 

with the energy management team as 

there are specific responsibilities that 

should be assigned to those whose support 

is necessary for delivering effective energy 

management. This might include: 

• The Chief Executive and other senior 

managers 

• Other key managers and their 

departments, such as: 

> production or service delivery 

> asset management/property 

• Facilities 

• Estates 

• Maintenance 

• Capital Projects 

> Finance 

> Procurement 

> IT 

> Human Resources 

> Security, Cleaners and Caretakers. 

Much like health and safety, everyone in 

the organization should be responsible for 

their own actions with respect to energy 

efficiency. 

Detailed interval energy consumption 

data makes it possible to see patterns of 

energy waste that it would otherwise be 

impossible to see. For example, there’s 

simply no way that weekly or monthly 

meter readings can show you how much 

energy you’re using at different times of 

the day, or on different days of the week. 

And seeing these patterns makes it much 

easier to find the routine waste in your 

building. However, where with health 

and safety there are legal obligations on 

all employees, energy efficient behavior 

is more appropriately driven through 

developing an energy efficient culture. 

Regulatory compliance and 

incentives 

All organizations need to understand 

which regulations apply to them and 

what they need to do to comply. The main 

regulatory schemes are: 

• Building Regulations and Energy 

Certificates (EPCs and DECs). 

• The Climate Change Levy (CCL) and 

Climate Change Agreements (CCAs). 

(CCAs are voluntary, but put 

requirements on those that participate). 

• The EU Emissions Trading System 

(EU-ETS). 

• Fluorinated Gas (F-gas) Regulations. 

Effective energy management provides the 

basis for efficient regulatory compliance 

and allows organizations to take advantage 

of incentive schemes such as Enhanced 

Capital Allowances and Feed-in Tariffs. 

Investment 

Most organizations will need investment 

to take full advantage of cost-effective 

energy efficiency opportunities. Projects 

that cut energy costs should be compared 

on a rational basis with other investment 

opportunities. It is common for energy 

efficiency projects to lose out to other 

demands on funds perceived to be of 

greater importance. 

Good investment practice can 

be characterized by: 

• A ring-fenced budget for energy 

efficiency/sustainable energy under the 

control of the Energy Manager. This 

avoids the danger of funds being diverted. 

• Retention of a proportion of energy 

savings by the function to which they 

relate. This provides an incentive and 

reward for pursuing energy efficiency. 

• Appraisal on a whole lifecycle basis when 

comparing energy efficiency investment 

with competing demands on capital. 

• Presenting senior managers with clear and 

thorough business cases for investment. 

Procurement 

There are two areas of procurement 

critical to an effective energy management 

strategy: one is the procurement of energy 

itself; the other is procuring energy-using 

equipment, services and buildings. 

Energy procurement 

It is important to recognize that, although 

they are necessary, activities related to 

energy procurement should represent only 

a small part of energy management. The 

energy management function should focus 

on the reduction of energy demand rather 

than the procurement and administration. 

For example, a finance department is 

often responsible for buying energy, but 

not for managing it, so it’s important 

that they have access to the relevant 

information in order to make decisions 

about procurement. They can only save 

money if they understand the markets and 

know how your organization uses and will 

use energy. 

Procurement of equipment 

and services 

The energy performance of an organization 

is influenced by the equipment and services 


ENVIRONMENT 

it uses. Best practice requires that the 

energy performance of such items is taken 

into account when procurement decisions 

are being made. This will normally involve 

formal input from the energy management 

function. 

Procurement of buildings 

Procuring buildings, whether through 

a lease or purchase, can be a key factor 

in an organization’s long-term energy 

performance. As a matter of policy it would 

be appropriate to only lease, purchase or 

commission new buildings that meet the 

highest of energy efficiency standards. In 

the longer-term this will be a far more 

cost-effective way of reducing carbon 

emissions than improving existing stock. 

Metering, monitoring and 

targeting 

Energy metering, monitoring and targeting 

(MM&T) is the management information 

system that supports energy management. 

Also known as just monitoring and 

targeting (M&T), it is central to good 

energy management. Simply, you cannot 

manage what you don’t measure and what 

is not measured is not managed. 

Effective MM&T enables you to reduce 

costs through understanding your 

organization’s energy consumption and 

identifying waste and targeting inefficiency. 

The stages of MM&T are: 

• Collection of data on energy and on 

influencing factors such as weather 

conditions or production volumes 

• Analysis to convert data to information 

• Communication to convert information 

to knowledge 

• Actions to improve efficiency and 

eliminate waste. 

The MM &T Process Model 

Communication (Information to 

Knowledge) 

Data Analysis (Data to Information) 

Action (Knowledge to Results) 

Data Collection 

This is a continuous process, and once 

established should not be overly complex 

or time consuming. MM&T allows you to: 

• Detect avoidable energy waste that might 

otherwise remain hidden 

• Quantify savings achieved by energy 

projects and campaigns 

• Identify fruitful lines of investigation for 

energy surveys 

• Provide feedback for staff awareness, 

improve budget setting and undertake 

benchmarking 

• Calculate energy and carbon reduction 

targets rationally to reflect achievable 

performance – often, targets are set without 

consideration of practical application or 

achievability. 

MM&T also supports energy invoice 

checking and tariff negotiation. Sometimes 

the term is inaccurately used to just mean 

bill validation. 

Initial review 

The initial review should provide sufficient 

information for you to make a case to 

senior management to take an energy 

management strategy forward. 

Your initial review should give you an 

understanding of: 

• Your organization’s energy use and costs. 

• Factors affecting energy use, such as 

weather conditions or production rates. 

• Key issues, such as regulatory obligations 

or planned organizational changes. 

• Where your organization stands in 

relation to its aims for energy management. 

There are resources that can assist you 

with your review including: 

• Downloadable energy analyzer tool to 

manage your data 

• Metering, Monitoring & Targeting web 

pages with links to further guidance 

• Climate change legislation pages with 

links to government websites 

• Downloadable energy management selfassessment 

tools 

• Energy surveys guide (CTG055) 

The initial review should provide sufficient 

information for you to make a case to 

senior management to take an energy 

management strategy forward. 

Energy policy 

You will need an energy policy and 

strategy. At its simplest, an energy policy 

is a written statement of a commitment to 

managing energy and carbon emissions. 

An energy policy should normally include: 

• Endorsement from senior management 

– preferably the Chief Executive or 

equivalent. 

• The organization’s energy/carbon vision 

and aspirations, with specific objectives 

and targets. 

• A commitment to ensuring the 

integration of energy management in all 

relevant decision making. 

• A commitment to ensure that sufficient 

resources are in place to meet policy 

objectives. 

Energy strategy 

An energy strategy is a document setting 

out an action plan of how energy will be 

managed in the organization to meet the 

policy objectives. 

Conclusion 

It is clear from this information that 

it is important to prioritize energy 

management and that energy efficiency 

projects should never lose out to other 

demands on funds perceived to be of 

greater importance. Successful energy 

management is an investment that makes 

business sense. 


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TID BITS 

Nobel Prize Winners 2016 are; - 

Yoshinori Oshumi- Physiology of 

Medicine; Oliver Hart- Economic 

Sciences; Fraser Stoddart – Chemistry; 

Jean-Pierre Sauvage – Chemistry; Bob 

Dylan – Literature; Bengt Holmstrom - 

Economic Sciences; Juan Manual Santos- 

Peace Prize. Detailed information on the 

Nobel Prize winners can be found in the 

web; however you can savor a few below; 

Jean-Pierre Sauvage is a French 

coordination chemist working at 

Strasbourg University. He has specialized 

in supramolecular chemistry for which he 

has been awarded the 2016 Nobel Prize in 

Chemistry. 

Ben Feringa – Chemistry: Prof. Ben 

I. Feringa obtained his PhD at the 

University of Gronigen; where he was 

appointed full professor in 1988 - after 

working as research scientist for Shell. 

Under his guidance the Feringa group has 

developed extensive expertise in the fields 

of organic chemistry, nanotechnology, 

asymmetric catalysis. His discovery of the 

molecular motor ranks highly among the 

many discoveries made over the years. 

Bob Dylan is an American song writer, 

singer, artist and writer. 

Meanwhile Pbs.org reports that three 

physicists — David Thouless of the 

University of Washington, Duncan 

Haldane of Princeton University, and 

Michael Kosterlitz of Brown University 

— won the Nobel award for physics for 

showing that topology can apply to atoms 

and other tiny matter within the quantum 

universe. By mapping out this quantum 

topology, their work has led to many 

modern materials and may bring society 

closer to the age of quantum computers. 

“Today’s technologies, take for instance 

our computers, rely on our ability to 

understand and control the properties 

of the materials involved,” said Nils 

Mårtensson, acting chairman of the Nobel 

committee. “This year’s Nobel laureates, in 

their theoretical work, have discovered a 

set of totally unexpected regularities in the 

behavior of matter. This has paved the way 

in designing new materials.” 

Could African Agriculture 

Leapfrog Harmful Pesticides by 

Using Plant Microbiomes? 

In Africa, where there is an overwhelming need to 

improve soil health and crop productivity, mocribial 

science in agriculture is just getting started. 

Researchers believe there is a revolution in finding 

alternatives to pesticides and artificial fertilizers that 

can improve African farm productivity. Scientists are 

investigating the plant microbiome – the billions of 

bacteria living in roots, leaves and soil that help plants 

absorb minerals and nutrients, fight disease, and resist 

drought and heat. Like the human microbiome — 

the bacteria and fungi in the gut that help us digest 

food and fight infection — the plant microbiome 

could be key to generating more food without the side 

effects like pollution, environmental degradation and 

toxic residues from chemical pesticides, Fast Coexist 

reported. 

Source: AFK Insider.com 


TID BITS 

Lucky Zuma 

South Africa’s President Jacob Zuma 

survived a no confidence vote in 

parliament in November when the 

ruling ANC parliamentarians decided 

not to vote him out. He was being 

investigated after new revelations of 

corruption led to a fresh probe. He is 

facing criticism from his own ANC 

party as well. 214 law makers were 

against the motion (to remove him) 

while 126 were in favor of his removal. 

Pippa Middleton sets 

a date for her wedding 

to James Matthews in 

2017 

The 33-year-old socialite is sending 

‘Save The Date’ invites as wedding 

preparations get underway. Pippa 

Middleton and fiancé James Matthews 

have reportedly set a date for their 

wedding. The couple, who announced 

their engagement in July, are already 

making plans for their big day. The 

33-year-old bride-to-be, who has her 

sights set on a wedding in 2017, has 

had ‘Save The Date’ invitations made, 

which will be delivered along with 

their Christmas cards to friends and 

family. Pippa has also been having 

fittings for her wedding dress and will 

reportedly wear a £10,000 designer 

gown as she walks down the aisle, Mail 

Onliner reports. She famously made 

global headlines as a bridesmaid at the 

wedding of her sister the Duchess of 

Cambridge to Prince William, courtesy 

of a figure-hugging dress. 

US election 2016 

After the surprise win of Donald J. 

Trump in the US November elections, 

the President elect appeared in “60 

minutes” where he was asked whether 

he would seek to deport millions and 

millions of undocumented immigrants,” 

Mr. Trump said his priority would be to 

remove “people that are criminal and have 

criminal records.” In many cases, convicts 

would have to go through immigration 

courts before they could be deported. 

Those courts are overwhelmed with huge 

backlogs, so obtaining deportation orders 

from judges can take many months — if 

not many years. Thousands of immigrants 

are serving jail sentences that under 

current law cannot be curtailed. According 

to official figures, as of June only about 

183,000 immigrants had been convicted 

of crimes and also had deportation 

orders so they could be detained and 

removed quickly. Mr. Trump’s approach 

would in some ways be a continuation of 

policies Mr. Obama has pursued to focus 

immigration enforcement on convicted 

criminals. 

Who is Donald J. Trump? 

Donald John Trump is an American 

businessman, reality television personality, 

politician, and President-elect of the 

United States. Was born on June 14, 1946 

(age 70) at Queens, New York City, New 

York, United States his height is 

6’ 3” 

Net worth: 3.7 billion USD (2016) Forbes 

Spouse: Melania Trump (m. 2005), Marla 

Maples (m. 1993–1999), Ivana Trump (m. 

1977–1992) 

Children: Ivanka Trump, Tiffany Trump, 

Barron Trump, Eric Trump, Donald 

Trump Jr. 

Education: Wharton School of the 

University of Pennsylvania (1968), 

Wikipedia 

The future of AGOA 

with Trans-Pacific 

Partnership Rising 

The number of regional trade 

agreements has almost quadrupled 

in the past 25 years, from 70 in 1990 

to around nearly 280 today. The 

collapse of the Doha round of trade 

talks in Nairobi in December has 

deflected energy to regional trade 

agreements. These agreements are 

great in helping rejuvenate global 

trade, which slowed as the economic 

recovery tapered in recent years and 

the Chinese economy decelerated. 

Africa is well positioned to engage 

regional trade agreements. Signed 

in Sharm-el-Sheikh, Egypt, in June 

2015, the Tripartite Free Trade 

Agreement (TFTA) brings the 

Common Market of Eastern and 

South Africa (COMESA), the East 

African Community (EAC) and 

the Southern Africa Development 

Community (SADC) into the 

continent’s largest free-trade zone 

covering 26 countries from Egypt to 

South Africa. The agreement aims to 

fuel the continued growth of intraregional 

trade on the continent, 

which has skyrocketed from $2.3 

billion in 1994 to $36 billion in 

2014. Intra-Africa regional trade 

still accounts for just 25 percent of 

total exports for the sub-Saharan 

region at 70 percent and 50 percent 

respectively. Sub-Saharan Africa still 

has a distance to go. 

Source: AFK Insider 


BOOK REVIEW 

Reviewed by Angela Mutiso, cananews@gmail.com 

Title: Make your knowledge sell 

Author: Ken Evoy, MD and Monique Harris 

Category: Personal Development 

Publisher: Site Build it 

Make Your Knowledge 

Sell (MYKS!) is an E 

book that has got quite 

a number of positive 

reviews. Those who have 

read it, very quickly admit that it has 

changed their lives. I will share with you 

some of the reviews of this amazing book; 

Make Your Knowledge Sell shows you 

how to find “the info-product within,” 

how to create and publish it, and how to 

market and sell it. You’ve learned so much, 

so gradually, you don’t realize how much 

you know! It’s a lifetime of information 

that people will pay for. Get started writing 

now! There’s a book in everyone. Each 

of us lives a life of unique circumstances 

and experiences that results in building a 

body of knowledge... knowledge that has 

value and that can be packaged and sold to 

others. 

MYKS covers far more than finding 

your subject. It’s the entry point to a 

true info-publishing business. This book 

supports you with a step-by-step approach 

to publishing. People want to learn about 

what you already know. MYKS empowers 

you to win on the Web by using the single 

best opportunity you have... the knowledge 

stored in your very own brain. So you see, 

you can write a profitable E-book and that 

is because as the authors say: There’s an 

e-book in everyone. And yours is based on 

what you already know. 

You know stuff other people don’t... 

things people would pay to know. So you’re 

already very close to profiting from your 

knowledge. Now you just need to know... 

• How to pull it out of your brain 

• How to publish it 

• How to sell it on the Net 

Evoy says, “Make Your Knowledge Sell!” is 

the title of the book that Monique Harris 

and I have written... a proven system for 

creating, publishing and marketing your 

info-product, yourself. 

Evoy notes that his co-author Monique 

Harris started out pretty much like you. 

She didn’t use rocket science to achieve her 

tremendous e-publishing success. In fact, 

not so long ago, Monique was an ordinary 

receptionist. But she wanted to learn more, 

and do more. A college dropout... but 

sincerely interested in searching herself 

for knowledge and capabilities that other 

people wanted, too. So Monique wrote 

her first book, fine-tuned it, promoted 

it... and within two short years she was 

profiting daily from sales on the Internet 

-- and had become an info-preneur and 

speaker earning $100K plus a year. He 

says now she’s joined forces with him to 

publish this fantastic guide that enables 

other “ordinary” people to do exactly what 

she did. (Although, as you’ll see... no one is 

really “ordinary,” right?) 

MYKS shows you clearly how to create 

and publish your info-product. Then it 

shows how to build traffic that will buy 

from you on the Net. It’s all here. So, to 

answer the question that so many people 

ask... The book gives examples of ordinary 

people who have succeeded in writing 

what they know; A housing contractor 

knows what contracting scams to watch 

out for... how to get lumber at cost... traps 

to avoid... checklists galore for doing just 

about everything in home construction... 

and much, much more. 

A middle-aged woman is looking for 

an income stream that she can pursue from 

home, because she spends a lot of time 

taking care of her parents who live with her. 

She knows more than 99% of the population 

does about living with and caring for elderly 

parents. Additionally, what problems have 

you faced, or what mistakes have you made? 

How did you solve or fix them? What would 

you have paid to avoid them? What did you 

learn? Present and promote your knowledge 

properly, and others will pay to learn from 

your experience. Again, Where have you 

traveled, what did you learn, and what 

mishaps can you help others avoid? Twentyseven 

years old and like to bar-hop? Create 

your ultimate insider’s guide to the best spots 

in town. 

What problems have you faced, or what 

mistakes have you made? How did you solve 

or fix them? What would you have paid to 

avoid them? What did you learn? Present 

and promote your knowledge properly, and 

others will pay to learn from your experience. 

Still looking for your own example for 

this list? There are so many possibilities that 

the mind boggles. MYKS shows you how to 

find your special niche. Here’s just one more 

real-world example for now... 

How long have you been in your business? 

10, 20, 30 years? You’ve learned so much, so 

gradually, you don’t realize how much you 

know! It’s a lifetime of information that 

people will pay for! Get started writing now! 

Everybody has literally hundreds of starting 

points! 

All you need is some guidance and a plan 

of action that you can follow. Evoy further 

says Monique and I show how to...pinpoint 

what you know, find out who else wants 

to know it, and create an infoproduct that 

those other folks will buy….And then...sell 

it successfully, again and again. So get your 

copy now! 

PS 

Make your knowledge sell is a Free EBook 

published by Site Build it! (Additional 

writers resources for personal development 

professionals) check http://www.empoweringpersonal-development.com. 

This informative e 

book used to be paid for but is free now. 


MEMORABLE QUOTES 

“His wife Graca called me with the 

words your friend has left us.” 

These were the words of the late 

Harvard educated professor of 

economics Washington Jalang’o 

Okumu the man credited with 

saving South Africa’s independence 

elections from collapse to a journalist. 

He says so close was Okumu to 

Nelson Mandela that he was the 

second person the family called 

upon Mandela’s death. The professor 

died at his home in Nyang’oma East 

village, Bondo sub-county, Siaya 

County recently. 

“To put it plainly, we can choose 

Jacob Zuma or we can choose South 

Africa.” 

Leader of the Democratic Alliance 

(DA) opposition party, Mumusi 

Maimane ;appealing to ANC 

members to vote against their leader. 

Jacob Zuma after fresh allegations on 

corruption was brought. 

“No matter what people say about 

me, I am not moved…I don’t listen 

to anybody because I know what 

is important…it is between me 

and God….You want to listen to 

everybody and satisfy everybody, 

you will end up satisfying the evil 

people. Do what is right. Make sure 

you satisfy the Almighty Allah. 

Zambia’s leader Yahya Jammeh 

51; after submitting his candidacy 

to seek a fifth term in his country’s 

presidential elections; He took over 

power in a bloodless coup in 1994 

“The suspect is presently at large 

but in future the locals must exercise 

a lot of caution to ensure they buy 

meat from licensed outlets to avoid 

catching diseases.” 

Murang’a County Chief Officer 

Joseph Mbai; speaking after twelve 

people were admitted to Murang’a 

after eating meat from a cow 

suffering from anthrax; A number 

of people were rushed to hospital 

after they developed anthrax related 

symptoms. 

“Now that he has secured victory, 

Trump should move from headlinegrabbing 

rhetoric of hatred and 

govern with respect for all who live in 

the United States. He found a path to 

the White House through a campaign 

marked by misogyny, racism and 

xenophobia, but that’s not a route to 

successful governance. “ 

Kenneth Roth; Executive Director 

of Human Rights watch, in their 

congratulatory message to presidentelect 

Donald Trump; he urged him 

not to bring to pass some of his 

campaign ideas. 

“We choose to believe in a hopeful, 

inclusive, big hearted America.” 

Democrat Presidential candidate 

Hillary Clinton; she said this as she 

wound up the campaign in which 

she lost to Donald J. Trump. Polls 

had earlier predicted her win, as the 

world waited with bated breath for 

the results which favored Trump in the 

end. 

“A Trump win would catch the 

markets as off-guard as Brexit.” 

Analyst Aly Khan Satchu; he made this 

comment on his market report in the 

Star, as the world awaited the results 

of 2016 US elections. This election 

has been quoted as being one of the 

most bitter campaigns in memory. 

“We looked at whether this antibiotic 

can be used to destroy diseasecausing 

bacteria which are resistant 

to commonly used drugs….We began 

six years ago, and we have seen that 

it works by destroying the bacteria 

that cause skin infection and mastitis 

in cows….Over 50 percent of skin 

infections in the country are caused 

by methicilin-resistant staphlycoccus 

aureus bacteria. Murcamacin 

destroys this superbug and works 

eight times better than the common 

antibiotics.” 

Ryan Awori, 27; Revealing his 

innovation at an international science 

conference in Berlin Germany. His 

drug Mursamacin is said to have 

been derived from roundworms in 

soils found in central Kenya. The 

worms apparently release beneficial 

bacteria which produce antibiotics 

that destroy rot-causing organisms. 

Source- Daily Nation 

“The past week has seen a line 

crossed….His (Prince Harry) 

girlfriend, Meghan Markle, has been 

subject to a wave of abuse and 

harassment…Prince Harry is worried 

about Ms Markle’s safety and is 

deeply disappointed that he has not 

been able to protect her. It is not right 

that a few months into a relationship 

with him that Ms Markle should be 

subjected to such a storm. He knows 

commentators will say this is ‘the 

price she has to pay’ and that ‘this 

is all part of the game.’ He strongly 

disagrees. This is not a game – it is 

her life and his.” 

Prince Harry’s communications 

secretary Meghn Markle, explaining 

that Britain’s Prince Harry has 

blasted the racist wave of abuse and 

harassment directed towards Meghan 

Markle, his girlfriend. Her mother is 

black and her father is white. 

“While advances in technology will 

present significant opportunities and 

revolutionize aspects of our everyday 

lives, it will also present significant 

challenges to police…Driverless 

vehicles could be exploited by 

criminals, including terrorists, to be 

pre-programmed to carry out criminal 

acts.” 

Ramzi Jabbour; Deputy Commissioner 

of the Australian Federal Pokice (AFP) 

“Never blame anyone in your life. 

Good people give you happiness. 

Bad people give you experience. 

Worst people give you a lesson. 

Best people give you memories.” Zig 

Ziglar 

“A leader can shape his followers 

best by showing them the way 

forward rather than telling them 

about it.” -Unknown

STAR OF THE MONTH 

Interviewed by Angela Mutiso, cananews@gmail.com 

has increased and there is plenty to 

draw from. His tenacity has moved 

him up many ranks, and he is glad 

to report that his time at Sony Sugar 

Company Ltd continues to be a fine 

learning experience. CPA Onyango 

has combined the experience he has 

gained, with a natural curiosity, and 

a comprehensive knowledge of the 

organization that gave him his first 

job to make his department efficient 

and up to date. He is however quick 

to point out that the success of 

the Finance department and the 

Company at large, stem from a joint 

and sustained effort by all members 

of staff and good leadership coming 

from the Management Committee led 

by the Managing Director. 

GET IT RIGHT 

FIRST TIME 

CPA George Omondi Onyango 

a Senior Accountant in charge 

of Management Information 

and Budgeting (SAMIB) at Sony Sugar 

Company Ltd took on an accounts 

clerk job at Sony Sugar Company Ltd 

a month to his graduation. However 

one thing the young accountant did 

not envisage at that time was how 

central his services would be to his 

employer and profession or how far 

and rapidly he would rise. 

He looks back at the events of his 

intricate life; His father died when he 

was fairly young; his mother widowed 

early, soldiered on with commendable 

courage to bring him and his siblings 

this far. He believed then that this 

accounting job he had desired for a 

long time, if well grasped would give 

him a healthy work-life balance and 

concluded that the icing on the cake 

would be to embrace the pleasure 

and adventure of the profession. 

Besides, he hoped to put to good use, 

the opportunity he had been given 

to show his loyalty and add value to 

a distinguished Company that had 

given him an occupation at a critical 

time. Appreciatively, the going has so 

far been good as is attested by this 

feature. 

On the most interesting and perhaps 

most vital level; CPA Onyango in 

his early thirties, has discovered a 

new sense of enchantment in the 

direction the accountancy profession 

has taken and relishes the status 

and responsibilities that come with 

it today. Quite apart from raising the 

scope of accountants’ expertise, the 

utilization of professional services, 

He has superb working knowledge 

in an integrated computerized 

accounting and operational 

system. He is in addition, a Quality 

Management Systems Lead auditor 

(KEBS), Operating Performance Index 

champion (KIM) and soon pursuing 

his PHD at the University of Nairobi. 

CPA Onyango says his aspiration is 

to hold and manage a strong and 

responsible position in finance and 

accountancy in an integral institution 

where there is transparency and 

accountability and where peoplemanagement 

skills are nurtured, 

developed and completely utilized. 

Following is a summary of his 

education, his work and his life; 

At Sony Sugar, he has worked in 

several positions, his jobs have 

encompassed; Preparation of 

various reports and also directing, 

supervising, appraising and training 

personnel in the department to ensure 

smooth and efficient performance 

of work as a cost accountant and 

Nucleus Estate Accountant among 

others. 

He has attended several workshops 

and seminars, notably; Financial 

Accounting (Delloite & Touche); 

Change Management; (Visionary 

Leadership and consultants); 



Organizational Performance Index 

Champion (KIM); Internal Quality 

Auditing and Information security 

and systems management (KEBS); 

Tax Seminar on PAYE, WHT and 

VAT (PWC) Emerging Trends in IT 

and Ethical Accounting – A dream 

or reality (Strathmore University) 

and FiRe awards evaluation process 

(Matengo Githae). 

Academic and Professional 

Qualifications 

Masters in Business 

Administration 

- University of Nairobi 

Bachelor of Commerce 

- University of Nairobi 

Certified Public Accountant 

- Strathmore University 

MS Office suite, Sage, Quick books 

First Job; Accounts clerk at Sony 

Sugar Company Ltd; out growers’ 

accounts division 

Leadership positions held: 

Quality management systems 

Finance Department representative, 

Chairman- Finance Determinant; 

Operating Performance Index, 

Finance and Controlling Super user 

in ERP-SAP, Vice Chair Manyatta 

Youth Polytechnic and Director 

Nairobi Elite College among others. 

Areas of interest in Finance 

and Accounting: Management 

accounting, cost accounting, financial 

accounting, financial statement 

analysis, corporate finance and 

public sector financial management. 

Below are excerpts from our interview: 

What inspired you to become an 

accountant? 

While in Primary and High school, I 

used to get good marks in Business 

Education. So I decided to nurture this 

skill. The element of accountability 

was another factor; my dad always 

made us accountable. Whenever he 

sent us to buy stuff, he would make 

us account for every transaction and 

from this I realized that finance was 

the order of doing business and it was 

Some of my 

responsibilities 

and achievements 

include being a 

super user in the 

implementation of 

ERP -SAP in finance 

and controlling 

modules. These 

include preparing 

data for migration 

from manual system 

to the new system, 

guiding and training 

staff in adopting 

and implementing 

the new system and 

also liaising with the 

ICT department in 

sorting out teething 

problems. 

imperative for me to understand how 

the economy operates. 

Notable responsibilities and 

achievements 

Some of my responsibilities and 

achievements include being a super 

user in the implementation of ERP 

-SAP in finance and controlling 

modules. These include preparing 

data for migration from manual 

system to the new system, guiding 

and training staff in adopting and 

implementing the new system and 

also liaising with the ICT department 

in sorting out teething problems. My 

responsibilities also entail ensuring 

the integrity of the subsidiary and 

general ledger, ascertaining the 

integrity of controlling and funds 

management sub modules and also 

ensuring that proper systems and 

procedures are put in place and well 

documented. 

Others are: leading the finance 

department in ISO 9000 QMS 

i.e. preparing, implementing, 

monitoring and reviewing the 

entire department procedures and 

documentations and also carrying 

out customer satisfaction surveys. My 

achievements also include analyzing 

and identifying the root cause, 

correction and corrective action 

plans to rectify any non-conformity. 

Most challenging task 

The most challenging task for me 

was being a Financial Reporting 

(FiRe) awards evaluator especially 

in the IFRS category as it had 1400 

lines as guidelines for pointing out 

areas of non-compliance alongside 

the auditor’s report, Public Finance 

Management Act, Companies 

Act, Board and Management 

reports, clarity of notes, Corporate 

Governance and environment and 

sustainability reports. Remember all 

these are not looked at in isolation 

I had to read and understand all 

the assigned financial statements 

and penalize for areas where there 

were mistakes and submit a report; 

I was allocated quite a number of 

statements. 

Best moment in your job? 

That happened the first time I was 

given an opportunity to present the 

budget and 2ndquarterManagement 

Accounts to the Board Finance 

committee; the Managing Director 

and the Head of Finance as well 

as other senior management were 

happy with my performance and that 

made me happy. 



In your view is the accounting 

system in Kenya moving in the 

right direction? 

Yes - 

• This is because of disclosure, 

corporate governance, integrated 

reporting and key audit matters; 

making our financial reports more 

appealing to the readers. However 

there is need for a review of the 

Accountants’ Act to respond to new 

sectors after thorough consultation 

with members. 

• One issue of concern however 

is that the institute needs to take 

action on errant members to save the 

face of the accounting profession as 

the public heavily relies on us when it 

comes to financial matters as we are 

the experts. 

What changes would you like to 

see at ICPAK? 

• The element of devolution; branches 

need to be more empowered. 

• The issue of technical services; 

ICPAK needs to engage members 

more as it’s the backbone of this 

noble profession. 

• The issue of member services; they 

never pick up calls- this is a real 

concern. 

• ICPAK should also know what their 

members do and where they are 

based and also create opportunities 

for members. 

• ICPAK needs to streamline 

who should be referred to as an 

accountant as per Accountants’ Act. 

• Public sector accountants are 

disadvantaged because unlike 

advocates and doctors, we don’t 

get non-practicing allowance; this 

should be addressed. 

• Deregistration of members 

should only happen after reaching 

out to members and getting their 

views. Find out why they have not 

subscribed given that one may be 

sick, out of employment or simply in 

financial distress. 

• Regarding corporate governance; 

there is need for action on errant 

members by the new disciplinary 

team; fraud cases and creative 

accounting are wrecking our image; 

this must be redeemed at all costs. 

• Disciplinary action should be 

amicable and only taken when there 

is sufficient evidence that a member 

has failed in due professional care. 

Also, proper investigations need to be 

done before taking action. i.e. don’t 

just go by hear -say. 

• I appreciate the work done by the 

office of the Accountant General by 

training public sector accountants 

at Kenya school of Government 

and also encouraging public sector 

organizations to participate in the 

FiRe awards competition. This 

approach has greatly improved public 

sector financial statements and 

sooner or later we shall be winning 

awards in the competition. 

What counsel do you have for 

budding accountants? 

You need to: 

• Have a good accounting foundation 

• Acquire strong IT skills 

• Specialize in one line; accounting, 

tax or auditing i.e. you should 

specialize in your area of interest. 

• Follow due process 

• Be a problem solver and team 

player; always lead from the front 

and offer suggestions to your team 

when there are bottle necks. 

• Remember, good work ethics and 

integrity will always stand you in 

good stead. 

• Never Gossip about anyone, 

especially your seniors, juniors 

and associates, it’s bad for you 

and your advancement. Avoid it 

like the plague, if there is an issue, 

have fruitful deliberations and find 

a solution. This not only applies to 

your work place, it applies to all 

aspects of your life, and to all of us. 

What motivates you? 

Getting it right first time; you need to 

know what you want to do (goal) how 

to do it, (process) when to do it (set 

timelines) and why you are doing it 

(what do you want to achieve?) you 

also need to have a passion for it. 

What do you do in your free time? 

I like reading accounting and finance 

journals, spending time with family, 

watching football and also farming 

as a hobby where I get some income. 

Vote of thanks 

I owe a lot of gratitude to my late 

parents for teaching me the values 

of life. My dad died when I was in 

high school. If mum hadn’t taken 

me to college, I wouldn’t be where 

I am today. My parents taught me 

the virtues of humility, patience, 

integrity, accountability, fearing God, 

and often reminded us that we do not 

live in a vacuum as man is naturally 

interdependent. 

I would also like to thank all 

my seniors for giving me immense 

development skills and an 

opportunity to grow by creating an 

enabling environment for me to work; 

I owe a debt of gratitude to Jane P. 

Odhiambo, Managing Director of 

Sony sugar company Ltd and to 

other staff member without them, I 

wouldn’t have attained what I have 

today. 


ACCOUNTABLE RECIPES 

Poached 

Plum Fool 

Mexican 

Chocolate 

Chicken 

Serves two 

A delicious meal to make for your loved one’s 

on this month of love. 

• 4 Chicken Pieces, Drumsticks & Thighs 

• 30ml Cooking Oil 

• 1 Red Onion, Chopped 

• 2 Cloves of Garlic, Crushed 

• 2 Dried Chilies 

• 1 Fresh Chili, Chopped 

• 4 Tomatoes, Chopped 

• 350ml Stock Liquid 

• 100g Dark Chocolate, Chopped Finely 

• Salt And Pepper 

• Preheat the oven to 180°C. 

• Place the a pot onto the stove till hot , add 

the oil and brown the chicken. Set aside the 

chicken when browned. 

• Return the pot onto the heat and sauté the 

onions and garlic. 

• Add the chilies and tomatoes. 

• Place the chicken pieces back onto the pot 

and stock liquid. 

• Once it comes to a boil, switch off the stove 

and transfer the pot into the oven. 

• Allow to cook in the oven for 30 to 40mins 

with lid on. Then 10min without the 

lid. 

• Remove pot from oven and add the 

chopped dark chocolate, stir well. 

• Serve with fragrant herd rice and salsa. 

A quick and easy dessert that will wow your 

taste buds. 

Poached Plums 

1/4cup of sugar 

1 cup of water 

1 tea bag 

10 cherry Plums 

Vanilla Cream 

• 500ml cream 

• 250g Icing Sugar 

• 1 tsp of vanilla essence 

• Combine the poaching ingredients apart 

from the plums into a saucepan and 

bring to a boil, then reduce the heat to a low 

flame. 

• Place the Plums into the poaching liquid and 

cover for 10min. 

• Remove the plum and set aside, continue to 

reduce the liquid until thick syrup forms. 

• Place the cream in a bowl, whip until 

bubbles form. 

• Slowly add a spoon full of icing sugar at a 

time while whipping evenly. As it thickens. 

• Finish off by adding the vanilla essence and 

whip until thick and firm. 

• Place in the Refrigerator, to cool. 

Assembling 

• Spoon the cream into the glass, until half 

way the glass. 

• Cut the plum into half and remove the pit. 

• Place 2 halves in to the glass with cream and 

drizzle the reduced poaching liquid 


TRAVEL 

BREXIT MAKES 

BRITAIN A BARGAIN 

FAMILY HOLIDAY 

DESTINATION 

By Clive Mutiso, clivemutiso@gmail.com 

Britain’s recent referendum 

decision to leave the European 

Union has had some 

unexpected consequences for 

the country’s tourism industry. 

Brexit, and the subsequent weakening in 

the value of the Pound against the Kenya 

Shilling has made it cheaper than ever for 

Kenyans to plan a holiday in the United 

Kingdom. 

Despite the promises of eternal 

sunshine of the Leave campaigners, Brexit 

has not improved the notoriously fickle 

British weather, so late Spring, from May 

onwards, is the start of the season when 

visitors can enjoy some of the country’s 

myriad outdoor attractions, and with 

advance booking a return economy class 

airfare from Nairobi to Heathrow can 

still be had for under $800. Even with 

the Pound below Ksh127 levels, hotels in 

Central London can still seem expensive, 

so one option can be to book comfortable 

affordable accommodation a little out of 

the city centre and to make day-trip forays 

into the city by bus, train, or Underground. 

For short trips, downloading the Uber 

app can cut the cost of taxis, although 

the traditional London cabs, with their 

knowledgeable and carefully vetted 

licensed drivers, are still well worth the 

extra cost. 

Watford lacks the glamour of the 

West End but with hotel rates in the 

$100 a night range for a double, and good 

transport links, it is the sort of out-of-town 

base that is worth considering. With two 

Hiltons, a Holiday Inn, a Best Western, 

and several other options, there are plenty 

of good, affordable, rooms to choose from. 

And apart from Central London there are 

a whole host of attractions and adventure 


TRAVEL 

activities within easy reach that can make 

for a great family break. 

If your group includes children – of any 

age from seven to seventy – they would no 

doubt be thrilled by a visit to the Warner 

Bros film studio, just five kilometres away 

from Watford, for a whole day tour of 

the set where the Harry Potter movies 

were filmed. Visitors can see the original 

Hogwarts Express on Platform 9¾ of 

Victoria Station, visit the Hogwarts Great 

Hall, Dumbledore’s office, Malfoy Manor, 

Diagon Alley, and all the other locations 

from the films. The magical experience 

includes the inside story of how the movies’ 

special effects were created. Tickets must 

be purchased in advance. 

It is the depth and diversity of the 

attractions on offer that make the British 

tourist industry so successful. The main 

hustle is still the Royal Family, with their 

palaces, the pageantry and the spin-offs 

like the Duchy Original biscuits touted by 

Prince Charles. But even the lesser hustles 

of lesser mortals can be a great day out for a 

visitor, and another attraction just a stone’s 

throw from Watford is Knebworth House, 

If your group includes children – of any 

age from seven to seventy – they would 

no doubt be thrilled by a visit to the Warner 

Bros film studio, just five kilometres away 

from Watford, for a whole day tour of the set 

where the Harry Potter movies were filmed. 

the stately pile of the Earls of Lytton, 

descendants of the poet Robert Bulwer- 

Lytton, who was Viceroy of India and 

British Ambassador to France in the 19th 

Century, although the extensive gardens 

around Knebworth date from at least 

two hundred years earlier and the Lytton 

family’s association with Knebworth goes 

back far longer. Those who regard the 

British aristocracy as relics and dinosaurs 

will appreciate the irony of the fact that 

one of Knebworth’s principal features is 

its Wilderness Garden and Dinosaur Trail. 

There are more than 70 dinosaurs lurking 

in the shrubbery, including an awesome 

Tyrannosaurus rex, many of them emitting 

terrifying sounds, but, no doubt due to 

excellent management, not a single visitor 

has been bitten by a dinosaur. 

The dinosaur theme is carried into 

the extensive adventure playground, with 

its swings, zip wire, astro slide and Dino 

Bouncy Castle. Knebworth has something 

for everyone, even those who prefer 

tranquillity to activity, with a 250-acre deer 

park making a perfect picnic venue, and the 

laid-back ambience of the garden terrace 

tea room that serves coffee, snacks, and 

leisurely light meals. But the place is not all 

decorum and cream tea – Knebworth has 

in recent years become famous for some 

of the biggest rock concerts ever staged 

in Britain. But the Hall’s core business is 

family days out. 

Family days out have been a feature of 

British life since the 19th Century and the 

tradition has been sustained despite all the 

changes of the mobile phone and internet 

age. And some of the best things in life are 

free, like entry to one of the five Redwings 


TRAVEL 

horse sanctuaries – four in South East 

England within easy reach of London, and 

the other in Scotland. Horses have always 

held a special place in the affections of 

Britons, but in modern times some people 

have found it difficult to maintain the 

horses in their care and many horses have 

fallen into distressed conditions. Between 

them the five Redwings centres rescue 

more than 200 horses and donkeys every 

year and altogether they care for more than 

1,500 animals at any one time, making 

Redwings the largest horse sanctuary in 

the United Kingdom. 

There are three major aspects to the 

work of the organisation, starting with the 

promotion of the welfare of horses, ponies, 

donkeys, and mules through outreach 

to schools, colleges, and horse owners. 

However, education is not always enough 

and Redwings frequently has to rescue, 

care for, and rehabilitate horses that have 

not been properly looked after. Then, when 

abused animals have been taught to trust 

humans again, efforts are made to identify 

caring families to offer them a new home. 

Visitors are welcome from 10am to 4pm 

from Friday to Monday each week and get 

the chance to interact with the animals 

and the dedicated team who care for 

them. Apart from tea and cake, there are 

no touristy frills – just a chance to spend a 

few priceless hours in the countryside and 

learn about horses and their needs. 

With some of Europe’s biggest and 

But, no matter 

how many outof-town 

visits 

you make, you’ll 

no doubt still 

want to do all the 

City sights – and 

that is when you 

will appreciate 

the benefits of a 

public transport 

system that 

works so well 

that there is no 

need to hire 

a car to get 

around. 

most densely populated cities, Britain has 

all the problems of urbanisation, including 

homeless people living on the streets, 

violent crime, and drugs. But a redeeming 

feature is the care that has been taken to 

preserve as much as possible of the rural 

environment, and to give families the 

chance to get away from the inner city 

and enjoy nature. Wicksteed Park, in 

Kettering, is just North of London off the 

M1 motorway, and offers 147 acres of allday, 

all-the-year-round outdoor activities. 

The park is a registered charity, run with 

strong support from volunteers, and 

financed from the income from visitors. 

Laid out around a central lake, 

Wicksteed Park offers a Nature Trail with 

small wildlife and birds, an arboretum, 

a campsite, and more than 20 different 

children’s rides, including a miniature 

railway that meanders through the 

grounds. There are food outlets and a gift 

shop, a caravan site and a luxury lodge, and 

a campsite where visitors can sleep over in 

tents. 

While Wicksteed Park offers a 

smorgasbord of the simple rural pleasures 

of life, Paulton’s Family Theme Park in the 

New Forest in Hampshire near the South 

Coast is more glitzy, with activities and 

rides themed on kids’ television characters. 

Peppa Pig World has seven rides that echo 

the lives of the television characters Peppa 

and George and children get to meet 

the characters themselves. Critter Creek 


TRAVEL 

has even more rides and, from this year, 

visitors have had the added attraction of 

The Lost Kingdom, with eight different 

dinosaur rides. Parking at Paulton’s is free, 

but carry plenty of spending money for the 

rides, access to the gardens whichever of 

the thirteen different restaurants, snack 

bars and ice cream parlours that catch your 

fancy. 

But if you are looking for more than 

nature trails and passive rides, and want 

an unusual athletic experience, then it is 

worth spending part of your UK holiday 

in preliminary training for the next 

Winter Olympics. Let’s face it, if you do, 

then you are almost certain to make the 

Kenya Winter Olympic team – there is 

not much competition in the skiing and 

snow sledding categories in East Arica. 

The place to go is Snozone, which has two 

locations, one in the South of England just 

outside London, and one in the North. The 

centres offer real snow 364 days a year and 

since 2000 they have taught more than 1.8 

million people to ski and snowboard. Apart 

from adult training and coaching, every 

weekend there are SnoAcademy sessions 

for children aged seven to 15 years. Other 

action sports offered at Snozone include 

skydiving and climbing. 

But, no matter how many out-of-town 

visits you make, you’ll no doubt still want 

to do all the City sights – and that is 

when you will appreciate the benefits of a 

public transport system that works so well 

that there is no need to hire a car to get 

around. The bus network covers all zones 

from the city centre, through every suburb 

and beyond, and the Underground railway 

network runs through every part of 

Greater London, with some services now 

operating all night. There are taxis, guided 

tour buses, the Docklands Light Railway, 

rickshaws and even bicycles for visitors. 

The only means of transport not available 

– a real culture shock for patriotic Kenyans 

– is the matatu. 


PEN OFF 

Transforming 

our world 

The 2030 Agenda for 

Sustainable Development 

By FCPA Jim McFie, a Fellow of the Institute of Certified Public Accountants of Kenya 

The 2030 Agenda for Sustainable 

Development of the United 

Nations Organization is a plan 

of action for the people of the 

world, the planet and prosperity. 

It also seeks to strengthen universal peace 

in larger freedom. The UN recognizes that 

eradicating poverty in all its forms and 

dimensions, including extreme poverty, 

is the greatest global challenge and an 

indispensable requirement for sustainable 

development. The UN desires all countries 

and all stakeholders, acting in collaborative 

partnership, to implement this plan. The 

body is resolved to free the human race 

from the tyranny of poverty and want, 

and to heal and secure the planet. The 

UN is determined to take the bold and 

transformative steps which, they claim, are 

urgently needed to shift the world on to a 

sustainable and resilient path. As the people 

of the world embark on this collective 

journey, the UN pledges that no one will be 

left behind. The Sustainable Development 

Goals (SDGs)and the targets which the 

UN announced on 25 September 2015 

demonstrate the scale and ambition of this 

new universal Agenda. The SDGs seek to 

build on the Millennium Development 

Goals and complete what they did not 

achieve. They seek to realize the human 

rights of all and to achieve gender equality 

and the empowerment of all women and 

girls. They are integrated and indivisible 

and balance the three dimensions of 

sustainable development: the economic, 

the social and the environmental. The 

Goals and targets will stimulate action 

over the next 15 years in areas of critical 

importance for humanity and the planet. 

The UN points out that the Agenda is of 

unprecedented scope and significance. It is 

accepted by all countries and is applicable 

to all, taking into account different 

national realities, capacities and levels 

of development and respecting national 

policies and priorities. They are universal 

goals and targets which involve the entire 


PEN OFF 

world, the developed 

and the developing 

countries alike. They 

are integrated and 

indivisible and balance 

the three dimensions 

of sustainable 

development. 

The Goals and targets 

were the result of over 

two years of intensive 

public consultation 

and engagement 

with civil society and 

other stakeholders 

around the world, 

which paid particular 

attention to the voices 

of the poorest and the 

most vulnerable. This 

consultation included 

valuable work 

done by the Open 

Working Group of 

the General Assembly 

on the Sustainable 

Development Goals 

and by the United 

Nations, whose 

Secretary-General 

provided a synthesis 

report in December 

2014. 

In these Goals and targets, the UN 

sets out a supremely ambitious and 

transformational vision. It envisages a 

world free of poverty, hunger, disease and 

want, where all life can thrive. It envisages 

a world free of fear and violence; A world 

with universal literacy; A world with 

equitable and universal access to quality 

education at all levels, to health care and 

social protection, where physical, mental 

and social well-being are assured. A world 

where people reaffirm their commitments 

regarding the human right to safe drinking 

water and sanitation and where there 

is improved hygiene; and where food is 

sufficient, safe, affordable and nutritious. 

A world where human habitats are safe, 

resilient and sustainable and where there is 

universal access to affordable, reliable and 

sustainable energy. 

The UN envisages a world of universal 

respect for human rights and human 

dignity, the rule of law, justice, equality 

and non-discrimination; of respect for 

race, ethnicity and cultural diversity; 

and of equal opportunity permitting the 

full realization of human potential and 

contributing to shared prosperity; A world 

which invests in its children and in which 

every child grows up free from violence 

and exploitation. A world in which every 

woman and girl enjoys full gender equality 

and all legal, social and economic barriers 

to their empowerment have been removed; 

a just, equitable, tolerant, open and socially 

inclusive world in which the needs of the 

most vulnerable are met. 

The UN goes on to envisage a world 

in which every country enjoys sustained, 

inclusive and sustainable economic growth 

and decent work for all. A world in which 

consumption and production patterns and 

the use of all natural resources – from air 

to land, from rivers, lakes and aquifers to 

oceans and seas – are sustainable. One 

in which democracy, good governance 

and the rule of law, as well as an 

enabling environment at the national 

and international levels, are essential 

for sustainable development, including 

sustained and inclusive economic growth, 

social development, environmental 

protection and the eradication of poverty 

and hunger. One in which development 

and the application of technology are 

climate-sensitive, respect biodiversity and 

are resilient; One 

in which humanity 

lives in harmony 

with nature and in 

which wildlife and 

other living species 

are protected. 

S o m e 

people talk of 

the Sustainable 

Development Goals 

(SDGs) as if every 

person is familiar 

with all of them: I 

doubt that this is the 

case. Here they are 

so that we are all on 

the same page: 

Goal 1. End poverty 

in all its forms 

everywhere. 

Goal 2. End hunger, 

achieve food security 

and improved 

nutrition and 

promote sustainable 

agriculture. 

Goal 3. Ensure 

healthy lives and 

promote well-being 

for all at all ages. 

Goal 4. Ensure 

inclusive and equitable quality 

education and promote lifelong learning 

opportunities for all. 

Goal 5. Achieve gender equality and 

empower all women and girls. 

Goal 6. Ensure availability and sustainable 

management of water and sanitation for 

all. 

Goal 7. Ensure access to affordable, 

reliable, sustainable and modern energy 

for all. 

Goal 8. Promote sustained, inclusive and 

sustainable economic growth, full and 

productiveemployment and decent work 

for all. 

Goal 9. Build resilient infrastructure, 

promote inclusive and sustainable 

industrialization and foster innovation. 

Goal 10. Reduce inequality within and 

among countries. 

Goal 11. Make cities and human 

settlements inclusive, safe, resilient and 

sustainable. 

Goal 12. Ensure sustainable consumption 

and production patterns. 

Goal 13. Take urgent action to combat 

climate change and its impacts. 

Goal 14. Conserve and sustainably use 


PEN OFF 

The UN recognizes that eradicating poverty in all its 

forms and dimensions, including extreme poverty, is 

the greatest global challenge and an indispensable 

requirement for sustainable development. 

the oceans, seas and marine resources for 

sustainable development. 

Goal 15. Protect, restore and promote 

sustainable use of terrestrial ecosystems, 

sustainably manage forests, combat 

desertification, and halt and reverse land 

degradation and halt biodiversity loss. 

Goal 16. Promote peaceful and inclusive 

societies for sustainable development, 

provide access to justice for all and 

build effective, accountable and inclusive 

institutions at all levels. 

Goal 17. Strengthen the means of 

implementation and revitalize the Global 

Partnership for Sustainable Development. 

The UN is quick to caution stakeholders 

about the immensity of the task ahead. It 

adds that the promoters of the document, 

and the rest of the world, are meeting 

at a time of immense challenges to 

sustainable development. Billions of 

the world’s citizens continue to live in 

poverty and are denied a life of dignity. 

There are rising inequalities within and 

among countries. There are enormous 

disparities of opportunity, wealth and 

power. Gender inequality remains a key 

challenge. Unemployment, particularly 

youth unemployment, is a major concern. 

Global health threats, more frequent 

and intense natural disasters, spiraling 

conflict, violent extremism, terrorism 

and related humanitarian crises and 

forced displacement of people threaten 

to reverse much of the development 

progress made in recent decades. Natural 

resource depletion and adverse impacts 

of environmental degradation, including 

desertification, drought, land degradation, 

freshwater scarcity and loss of biodiversity, 

add to and exacerbate the list of challenges 

which humanity faces. Climate change 

is one of the greatest challenges of our 

time and its adverse impacts undermine 

the ability of all countries to achieve 

sustainable development. Increases in 

global temperature, sea level rise, ocean 

acidification and other climate change 

impacts are seriously affecting coastal 

areas and low-lying coastal countries, 

including many least developed countries 

and small-island developing States. The 

survival of many societies, and of the 

biological support systems of the planet, 

is at risk. 

As I was driving along Uhuru 

Highway a short while ago, a thin, young 

girl of possibly fourteen, fifteen or sixteen 

was idling on the sidewalk, sniffing a 

plastic bottle of glue, with a very small 

baby strapped to her back: she is just one 

of countless young girls in that state in 

the cities, towns and villages in Kenya. 

She has no family: her mother is possibly 

a prostitute: her father is a man who uses 

prostitutes: the father of the baby on her 

back is probably a street boy: what is the 

future of that young girl and that of the 

baby strapped to her back? It is very easy 

for the delegates of the various countries 

represented at the United Nations to 

publish well-meaning documents, which 

promise heaven on earth. But we must be 

realistic: are you and I doing enough to 

make Kenyans aware of the difficulties of 

eradicating poverty in Kenya? Do we take 

concrete steps to provide employment 

and explain to employees that all of us 

have to make sacrifices to increase the 

wealth we must create for society? Our 

culture tends to prevent us from helping 

those around us – as is the case the world 

over. So are the Sustainable Development 

Goals realistic? Or will we have 34 goals 

in 2030 (twice as many as those of 2015) 

which reiterate the same targets because 

we never achieved those of 2015? 


ICPAK L ve 

Tap and Connect 

You can now access ICPAK services from wherever you are. Through ICPAK LiVE 

you will be able to access econnect, upcoming events and news, interact with the 

Institute in real time, access and update your member record, socialize with your 

professional peers, give feedback to the Institute, post your technical queries to 

the Institute (Standard & Compliance) and earn your CPD hours. 

Downloading ICPAK LiVE 

to Android 

1. Open Google Play Store app on your 

Android device 

2. Click on the “Search” icon within Play 

Store, and type “ICPAK LiVE.” 

3. Select “ICPAK LiVE” from the listing of 

applications in the search results 

4. Tap on “Install” from the details screen for 

ICPAK LiVE. 

5. Click on “Accept” when prompted to from 

the App Permissions screen. 

6. Wait for ICPAK LiVE to finish downloading to 

your Android 

7. Use your usual user name and password to 

access members’ only functionalities (the 

one you use on ICPAK website) 

Downloading ICPAK LiVE 

from Apple App Store 

1. Open App store 

2. Sign in with your Apple ID 

3. Browse for ICPAK LiVE 

4. Tap on the app to install 



one you use on the ICPAK website) 

Downloading ICPAK LiVE from 

Windows phone 

1. Launch Marketplace application on your 

Windows phone. 

2. Tap on “Apps.” 

3. Type ICPAK LiVE into the search field. 

4. Select ICPAK LiVE from the search results 

provided 

5. Tap on “Install” at the top of the ICPAK LiVE 

details screen. The app will begin 

downloading to your Windows phone. 



one you use on the ICPAK website) 

Step1 Step2 Step3 Step4 Step5 

In case of any challenges please contact us through memberservices@icpak.com for help

with your ICPAK Smart Card 

ICPAK Smart Card benefits: 

• The smart card will be your member 

identification card at ICPAK events and 

when accessing services offered by 

ICPAK partners and is absolutely free 

• Up to 20% discount on tuition fees at 

KCA University for you and your family 

members 

• A negotiated 3.5% discount on motor 

vehicle insurance premiums at Jubilee, 

Pacis, APA, UAP and Britam 

• Up to 15% discount on purchase of 

motor vehicle, repairs, service and 

spare parts at Toyota and Toyotsu 

• Up to 20% discount on purchase of 

motor vehicle, repairs, service and 

spare parts at Simba Colt/Corp 

• Free access to KCA Library 

• Up to 15% discount at Hilton Hotel 

• 5% discount at Text Book Centre 

And many more 

For more information, please visit www.icpak.com

The Accountant-Jan-Feb 2017

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