19th June 2020
May's edition of the International Accounting Bulletin (IAB) examines the impact that another month of lockdown is having on the global economy. It highlights how member firms in Kenya, Nigeria and Ghana are coping in these difficult times by developing regulations and rasing auditing standards. MGI Worldwide with CPAAI member firms in the MGI Africa region contribute their experience.
Felix Kimoli from Kenya shares his thoughts
Felix Kimoli, partner at MGI Alekim LLP, Kenya, explains how the government has introduced tax changes in response to the Covid-19 pandemic, with VAT being reduced by 2% to 14%, and the PAYE top bracket and corporation tax rates reduced by 5-25%. However, investment deductions have also been reduced significantly.
There is also an expectation that within the public sector there may be future work in the form of NGOs and donors who have supported the coronavirus pandemic relief effort and need audits on their disbursements. Working remotely and meeting virtually has become the new norm, and a significant number of businesses will stick to this approach, suggests Felix, who anticipates restructuring for cost reduction, reorganisation of debts with banks and reduced borrowing. “There might be scope for insolvency-related assignments and increased fin-tech opportunities,” he adds.
When questioned on how clients perceive the economic prospects for the near future Felix says his clients have taken different views on the likely recovery period – ranging from six months to a year – and expects companies to change strategy to focus more on the immediate needs of customers. “We are experiencing a lot of adjustments and costs in facilitating working from different locations and due to the reduced work volume, job losses and redundancies are inevitable,” he adds. “Accounting firms – like many other businesses in Kenya – will report reduced revenues, and management will need to work extra hard to control job losses and guarantee continuity, even after the pandemic dust settles.”
Haruna Nma Yahaya from Nigeria comments
Haruna Yahaya, partner at Haruna Yahaya & Co., Nigeria, agrees that the adoption of new IFRS standards and interpretations within Nigeria has been significant, and also refers to efforts by government entities at all levels – federal, state and local – to adopt international public sector accounting standards. “We are seeing an increasing sophistication of clients as new financial instruments are issued in the Nigerian market, especially by regulatory authorities such the Central Bank of Nigeria, the Securities and Exchange Commission and the Federal Inland Revenue Service,” he adds. “In addition, there is increased awareness of the code of corporate governance.”
MGI Worldwide with CPAAI ranks highly in Africa
MGI Worldwide with CPAAI continues to rank highly within the Africa region, sitting in 6th position in Kenya in terms of total fee income/growth over the past 12-months. The network and association came 4th among Kenya’s top accounting associations in relation to their staff/growth data, with a total of 31 staff members.
In Nigeria, MGI Worldwide with CPAAI is ranked in 4th position for total fee income/growth over the past 12-months and sits in 9th position in regards to their staff/growth data.
Congratulations to Ghana’s MGI O.A.K. Chartered Accountants, where MGI Worldwide continues to rank highly, placing 5th in terms of fee/growth income and 5th among Ghana’s top accounting associations in relation to their staff/growth data, with a total of 12 staff members.
Click below to visit our member firm profile pages and websites:
MGI Alekim LLP member profile page and website.
Haruna Yahaya & Co. member profile page and website.
MGI O.A.K. Chartered Accountants member profile page and website.
If you are a member of MGI Worldwide with CPAAI you can access all the IAB copies in the Member's Area, under "Key international organisations".
MGI Africa is part of MGI Worldwide with CPAAI, a top 20 ranked global accounting network and association with over 10,000 independent auditors, accountants and tax experts in some 460 locations in almost 100 countries around the world.