The Accountant-Jan-Feb 2017

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The FiRe AWARD 2016 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. 24 JANUARY - FEBRUARY 2017
The FiRe AWARD 2016 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 BARCLAYS BANK OF KENYA KENYA ROADS BOARD OFFICE OF THE CONTROLLER OF BUDGET KENYA ROADS BOARD KENYA BANKERS ASSOCIATION CENTRAL BANK OF KENYA BARCLAYS BANK OF KENYA KENYA UNIVERSITIES AND COLLEGES CENTRAL PLACEMENT UMEME LIMITED BARCLAYS BANK OF KENYA BANK OF KIGALI CRDB BANK PLC STANBIC BANK UGANDA BARCLAYS BANK OF KENYA KENYA ROADS BOARD BARCLAYS BANK OF KENYA 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 JANUARY - FEBRUARY 2017 25
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Page 4 and 5: YOUR VIEWS SHARE YOUR VIEWS Email:
Page 6 and 7: Financial reporting and assurance T
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Page 13 and 14: COVER STORY KAM should be specific
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Page 53 and 54: TID BITS Lucky Zuma South Africa’
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Page 61 and 62: TRAVEL activities within easy reach
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The Accountant-Jan-Feb 2017

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