Connect with us
Advertisement

Gone Viral

With the exception of Antarctica, Covid still maintains its grip all around the world.  Infection rates and stats vary widely from place to place, however,  with experts arguing daily on main and social media as to why the discrepancies, where to point the finger of blame for poor response and handling and whose methodologies were most effective.  The fact is that no-one has a definitive answer and the debate will rage on for many months and years after the virus has been controlled or eradicated.

One bright spot is here in Botswana which has remained a bastion of low infection and relative safety.  The record of infections has remained at 23 for several weeks now, representing a rate of 0.0009% which is practically negligible.  This is not to say we should be complacent but if border restrictions remain in place and remain as robust as clearly they have been, the country will come through this pandemic with flying colours and, more importantly, a healthy nation.

Thus it is that from tomorrow, May 8th, restrictions will be eased to allow most businesses to return to work, albeit on a sliding scale and with caveats in place.  The return will be phased over 3 weeks with 25 percent capacity in week 1, 50 percent in week 2 and 100 percent in week 3, commencing 22nd May, God and the Ministry of Health willing.

There is also the compulsory wearing of masks by both staff and clientele, taking of temperatures and hand sanitising prior to entry for clients, regular deep cleaning of places of work and employee registration requirements – tiresome, perhaps but the important point is that the country will be returning to commerce and trade and for that we can all breathe a sigh of relief.

The buzz phrase, though, is ‘The New Normal’ and this applies now and for some time into the future to work and home life all around the world.  Some of this may be voluntary at the behest of staff members themselves.  For example, many who have been forced to work from home may choose to continue to do so, for the flexibility this option offers and the saving of time and money on the daily commute.

This will have the effect of enabling employers to downsize in terms of workspace and cut staffing ancillary costs such as travel allowances.  However, the other side of that coin is that the hot-desking of the past decade, whereby staff members were encouraged to use communal work places and equipment, an arrangement introduced by some employers to downsize floorspace and modernise the working practice, is now condemned as taboo because of the dangers of cross-contamination and infection,  so for the foreseeable future it’s back to one desk, one PC and one designated work station per employee.  As so often happens, fate gives with one hand and takes away with another!

Then there are the countless businesses which having been closed for some weeks or even months, will never be able to re-open.  For them the burden of paying rent while not generating income, not to mention contributing to employee salaries, even where limited government assistance has been forthcoming, will  have proved unsustainable and those businesses will go under,  corporate victims of the virus.

These range from the small, independent retailers, some pubs, fast-food outlets, restaurants and similar places of entertainment and specialised micro suppliers to some names formerly thought of as giants in commercial playing terms.

One such potential victim is Virgin Airways, part of the massive Branson empire, which had already scaled back its Virgin Australia arm and this week announced huge cutbacks in its Atlantic operation, eliminating over 3000 jobs as well as pulling out entirely from Gatwick Airport  to concentrate its flight operations from London’s larger Heathrow hub, a move that  brought forth calls for the  UK government to come up with some sort of financial bailout plan.  Similar cutbacks are also being drawn up by rival carrier British Airways.  And the department store chain and high street favourite, Debenhams, has had to announce that post-lockdown, five of its nationwide stores will never re-open their doors.

This is the new normal for all of us.  Life as we knew it in those halcyon days at the beginning of the year will never return, even when it’s safe to go back into the water, the mall and the office.  The travel industry will have been decimated by grounded flights and boarded-up hotels , small shops, already under threat from online trading, will fade into distant memory and  a myriad of commercial enterprises will simply disappear under a mountain of debts and bankruptcies.

And those industries currently making a killing manufacturing and supplying PPE and hand sanitisers, transport operators cashing in on movement restriction to provide door-to-door home deliveries, grey and black-market suppliers of hard-to-find goods,  niche local fresh food marketers and internet consultancy gurus offering all manner of home tutorials will find they are no longer needed and so will have to turn their hand to some other enterprise.

So the ‘new normal’ will be anything but.  Whether or not we caught the virus, Covid will have infected all of us with some symptoms from which we will never recover.  We are walking towards a Brave New World which will look and feel starkly different to the one with which we were so familiar to one in which even nostalgia will be nothing like it was before,

We will come through it, of that there is no doubt, but life as we knew it will never be the same again.  However. if even a few of you weaned yourselves off too much pubbing, clubbing and junk food binging in the interim, some good will have come out of it all.  Your bodies will thank you, even if KFC doesn’t!

QUOTE

This is the new normal for all of us.  Life as we knew it in those halcyon days at the beginning of the year will never return, even when it’s safe to go back into the water, the mall and the office.  The travel industry will have been decimated by grounded flights and boarded-up hotels , small shops, already under threat from online trading, will fade into distant memory and  a myriad of commercial enterprises will simply disappear under a mountain of debts and bankruptcies.

And those industries currently making a killing manufacturing and supplying PPE and hand sanitisers, transport operators cashing in on movement restriction to provide door-to-door home deliveries, grey and black-market suppliers of hard-to-find goods,  niche local fresh food marketers and internet consultancy gurus offering all manner of home tutorials will find they are no longer needed and so will have to turn their hand to some other enterprise.

Continue Reading

Columns

Economic Resurgence Options: Is Export-Led Growth Tenable For Botswana?

22nd September 2020

The world in which we live is a criminally unequal one. In his iconic 1945 allegorical novella,  Animal Farm, a satire on the facetiousness  of the then Soviet Empire’s crackbrained experiment with a command economy, the legendary George Orwell in my view hit the nail squarely on the head when he said all animals were equal but some animals were more equal than others.

That’s the never-ending dichotomy of the so-called First World and its polar opposite, the so-called Third World as Orwell’s cleverly-couched diatribe applies as much to the tread-of-the-mill laissez faire economics of our day as it did to Marxist-Leninist Russia a generation back.

This content is locked

Login To Unlock The Content!

Continue Reading

Columns

Victory is Won

22nd September 2020

Israelites take Canaan under General Joshua

Even as the Nation of Israeli braced to militarily take possession of the Promised Land, General, its top three senior citizens, namely Moses, Aaron, and Miriam, were not destined to share in this god-conferred bequest. All three died before the lottery was won.

This content is locked

Login To Unlock The Content!

 

Continue Reading

Columns

Finance Bills: What are they about?

22nd September 2020

Financial Reporting (Amendment) Bill, 2020 and Accountants (Amendment) Bill, 2020 were expeditiously passed by parliament on Thursday.

What are these two Bills really about?  The Bills are essentially about professional values that are applicable to auditors and accountants in their practice. The Bills seeks to basically enhance existing laws to ensure more uprightness, fairness, professional proficiency, due care, expertise and or professional technical standards.

The Financial Reporting Act, 2010 (FRA) establishes the Botswana Accountancy Oversight Authority (BAOA), as the country’s independent regulator of the accounting and auditing profession. BAOA is responsible for the oversight and registration of audit firms and certified auditors of public interest entities.

In the same vein, there is the Accountants Act, 2010 establishing the Botswana Institute of Chartered Accountants (BICA) which is responsible for the registration and regulation of the accounting and auditing profession. This consequently infers that some auditors have to register first with BICA as certified auditors, and also with BAOA as certified auditors of public bodies. So, the Bills sought to avert the duplication.

According to Minister Matsheka, the duplication of efforts in the regulation of auditors, which is done by both BICA and BAOA, creates a substantial gap on oversight of certified auditors in Botswana, as the two entities have different review procedures. He contends that the enforcement of sanctions becomes problematic and, thus, leads to offenders going Scot-Free, and audit quality standards also continue to plunge.

The Financial Reporting (Amendment) Bill, 2020, in the view of the Minister, brings the oversight and regulation of all auditors in Botswana under the jurisdiction of the Accountancy Oversight Authority and that Bringing all auditors within one roof, under the supervision of BAOA would therefore reinforce their oversight and significantly enhance accountability.

He also pointed that the Bill broadens the current mandate of the Authority by redefining public interest entities to include public bodies, defined as boards, tribunals, commissions, councils, committees, other body corporate or unincorporated established under any enactment.

This covers any company in which government has an equity shareholding. In order to enable the process of instituting fitting sanctions against violation of its provisions, the Bill clearly lays down acts and lapses that constitute professional misconduct.

This Bill further strengthens the sanctions for breach of the Act by public interest entities, officers, firms, and certified auditors. Reinforcing the law with respect to such sanctions will act as an effective deterrent for breach of the Act.

The Accountants Bill also strengthens the current mandate of the Institute by making it obligatory for those who provide accountancy services in Botswana to register with the Institute, and for all employers to hire accountants who are registered with the Institute.

The Minister reasons that in line with the spirit of citizen empowerment, this Bill proposes reservation of at least 50% of the Council membership for citizens. This, he says, is to empower citizens and ensure that citizenries play an active role in the affairs of the Institute, and ultimately in the development of the accounting profession in Botswana.

The Bills come at a point when Botswana’s financial sector is in a quagmire. The country has been blacklisted by the European Union. Its international rankings on Corruption Perception Index have slightly reduced.  According to recent reports by Afro Barometer survey, perceptions of corruption in the public service have soured and so is mistrust in public institutions.

Rating agencies, Standard Poor’s and Moody’s have downgraded Botswana, albeit slightly. The reasons are that there continues to be corruption, fiscal and revenue crimes such as money laundering and general unethical governance in the country. There are still loopholes in many laws despite the enactments and amendments of more than thirty laws in the last two years.

One of the most critical aspect of enhancing transparency and accountability and general good governance, is to have a strong auditing and accounting systems. Therefore, such professions must be properly regulated to ensure that public monies are protected against white color crime. It is well known that some audit firms are highly unprincipled.

They are responsible for tax avoidance and tax evasions of some major companies. Some are responsible for fraud that has been committed. They are more loyal to money paid by clients than to ethical professional standards. They shield clients against accountability. Some companies and parastatals have collapsed or have been ruined financially despite complementary reports by auditors.

In some cases, we have seen audit firms auditing parastatals several times to almost becoming resident auditors. This is bad practice which is undesirable. Some auditors who were appointed liquidators of big companies have committee heinous crimes of corruption, imprudent management, fraud and outright recklessness without serious consequences.

There is also a need to protect whistleblowers as they have been victimized for blowing the whistle on impropriety. In fact, in some cases, audit firms have exonerated culprits who are usually corrupt corporate executives.

The accounting and auditing professions have been dominated by foreigners for a very long time. Most major auditing firms used by state entities and big private sector companies are owned by foreigners. There has to be a deliberate plan to have Batswana in this profession.

While there are many Batswana who are accountants, less are chartered accountants. There must be deliberate steps to wrestle the profession from foreigners by making citizens to be chartered.  It is also important to strengthen the Auditor General. The office is created by the constitution.

The security of tenure is clearly secured in the constitution. However, this security of tenure was undermined by the appointing authority in many instances whereby the Auditor General was appointed on a short-term contract. The office is part of the civil service and is not independent at all.

The Auditor General is placed, in terms of scale, at Permanent Secretary level and is looked at as a peer by others who think they can’t be instructed by their equivalent to comply. Some have failed to submit books of accounts for audits, e.g. for special funds without fear or respect of the office. There is need to relook this office by making it more independent and place it higher than Permanent Secretaries.

Continue Reading
Do NOT follow this link or you will be banned from the site!