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Making sense of all the numbers

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When organisations publish critically required year-end financial and company reports, particularly for listed companies, the main go-to person is the Accountant and/or the Finance person; as ultimately it all boils down to the numbers.

If a company collapses one of the first questions is, ‘Where was the Accountant?’ The choice to downsize or restructure is placed on the Accountant’s shoulders. International and local reports and surveys allude to terms such as ‘Business Confidence’ they are, in gist, talking about the environment these custodians of business entities are responsible for.

In March this year the Business Expectations Survey (Bank of Botswana) concluded that, “Business confidence deteriorated from 52% in September 2014 to 44% in March 2015.

While the survey shows increased optimism in periods ahead, this could be fragile, with continued uncertainty regarding the strength of the global recovery, modest domestic economic growth and increasing challenges in the supply of key inputs (water and electricity) posing threats to business confidence.”

Despite the external but immediate challenges and threats to business confidence such as the regular supply of water and electricity and global recessions the above survey statement usually affects directly the accounts and finance offices who are tasked with turning the bottom lines from red into black. Since the economic downturn observers believe that accountants have had to adapt and transform and not only focus on meeting reporting deadlines or attaining clean audits.

Michael Kampani, Managing Director of G4S, who is also an accountant by profession explains that, “As Accountants at the heart of organisations we have a duty to drive business recoveries or turnarounds during this period of economic downturn and pessimism. The current economic downturn calls for more from Accountants as key members of the business leadership,” he adds.        

Speaking at the CIMA Botswana dinner dance recently, Kampani who has previously served for five years as Finance Director for G4S explains that an Accountant on company level is the, ‘financial advisor to the company’. “Accountants should be able to move the company forward, to steer the direction of the company by advising on the consequences of taking any route. Everything translates into money,” adds Kampani.

“There is pressure on revenue growth, pressure on margins, and ultimately pressure on profitability. If you cannot force the top line to grow, where else do you have to look?” Kampani’s observation is that effective management for accountants mean being forward looking and entails looking beyond retrenchments.

Although he emphasises that revenue growth is the heartbeat of any commercial entity he encourages an eye to be kept on other areas of business to increase profitability. One of the aspects he identifies as needing to be considered is; risk management and governance.

“In these times of economic downturn, when business is hard to come by, the last thing you want is to be faced with a huge financial or reputation risk,” he advises. Another area an accountant needs to show character in is ‘guarding against extreme short termism’. “Yes you can cut costs, you can freeze investments but that should be well measured, or else we risk adversely impacting sustainability.”

He observes that in regards to other accounting related functions such as procurement and sourcing the question should be, “How much are we saving with each procurement decision? Are we getting the best deal,” adds Kampani.

The CIMA Botswana Country Manager, Letus Chinyepi states that CIMA has geared itself to prepare the accountant to adapt to this changing work environment. The qualification now offers additional to its standard accounting courses subjects such as, ‘Risk Management and Internal control’, ‘Business planning’, ‘Change and Process Management,’ and ‘market environment’.

“The mentioned Competency Framework forms the base of the new 2015 syllabus that came about as survey results from major companies worldwide on a complete Finance Practitioner of choice who can turn-around the fortunes of an ailing company,” adds Chinyepi.

Above all the training and education levels, one essential component of a Finance Practitioner is integrity, a high level of integrity. When people handle money they are faced with the temptation to mismanage it.

“The best bet is that accountants affiliate with professional bodies such as BICA, ACCA and CIMA. These bodies have strict codes of ethics and their members need to abide by their rules. Should a member be accused of misconduct they will face sanctions. The bodies ensure your professionalism and integrity,” concludes Kampani.

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SMEs benefit from Consumer Fair growth

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The Botswana Investment and Trade Centre (BITC) has applauded Botswana Consumer Fair’s continued efforts to improve small to medium enterprises’ linkages.

BITC Chief Executive Officer, Keletsositse Olebile, when opening the fair, said the event has provided interactive forum for both local and foreign exhibitors. He said the shopping show has enabled manufacturers, wholesalers and traders to market their products directly to consumers, an alignment to government’s endeavors.

“As part of government intention, we continually encourage local sourcing by retailers and distributors,” said Olebile who is just few months into his new post. He further celebrated the growth of Botswana Consumer Fair over the years, attributing the expansion to quality of goods displayed at the previous shows.“Improved quality and increased variety of wares increases the interest of the visitors and makes them look forward to returning the following year,” said Olebile.

This year’s exhibitors at the 13th event still running under the banner: ‘It is more than just shopping’ have been drawn from Lesotho, Zambia, Swaziland, South Africa, Nigeria, Ghana, Kenya, Egypt, Japan, India, Tanzania and Zimbabwe.

Consumer Fair is a flagship event for Fairgrounds Holdings and provides a platform for small medium enterprises (SMEs) from the different sectors of the economy to showcase and promote their products and services. In addition, the SMEs are expected to establish long term business linkages and promote local manufactured goods.Fairgrounds Holdings is already optimistic that the Fair immensely contribute to the socio-economic development of the country through supporting SMEs.

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‘Involve SMMEs in standards development’-Minister

Keikantse Lesemela

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Minister of Investment, Trade and Industry, Bogolo Kenewendo appealed to Botswana Bureau of Standards (BOBS) to include the Small, Medium and Micro Enterprises (SMMEs) when developing the standards to improve the sector.

She said the Ministry of Investment, Trade and Industry has identified three areas of focus going forward which are modeled on SMME development, investment promotion and export development apexes. “I would like to implore you to include this sector in standards development processes and assist in improving SMMEs conformity to standards and compliance to technical regulations,” said Kenewendo.

Speaking during the BOBS Technical Committee Members appreciation ceremony on Thursday, Kenewendo explained that the important roles of standards are underpinned by the aspirations and intentions espoused in both diversified export led economic growth and job creation as priority areas. “It goes without saying that the diversification of the economy requires a National Quality Infrastructure and Technical Regulatory Framework that promote competitiveness of Botswana goods and services.”

She also emphasized that an effective National Quality Infrastructure and Technical Regulatory Framework are essential as they provide crucial links to global trade, market access and export competitiveness through their contribution to consumer confidence in product safety, quality and the environment.Since inception in 1997 BOBS has published more than 1700 standards through 48 technical committees across several sectors of the economy; 109 certification licences have been issued against some of these standards. Currently 46 Botswana Standards are being implemented through the standards regulations with a view to protecting the health and safety of consumers as well as protection of the environment.

On her note, BOBS Vice Chairperson of the Standards Council, Professor Edward Dintwa said standards are powerful tools for helping organisations that implement them to realize their potential, have access and compete in the global marketplace. “In this highly competitive and complex world, issues of sustainability and productivity, viewed from economic, environmental and societal perspectives require that businesses must be more efficient in their operations, which can be achieved through the implementation of standards”.

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