UNDERSTANDING FINANCIAL STATEMENT

What is the purpose of financial information?

For a business enterprise, all the relevant financial information, presented in a structured manner and in a form easy to understand, are called the financial statements. They typically include four basic financial statements:

1.     Balance sheet: also referred to as statement of financial position or condition, reports on a company's assets, liabilities, and Ownership equity at a given point in time.

2.     Income statement: also referred to as Profit and Loss statement (or a "P&L"), reports on a company's income, expenses, and profits over a period of time. Profit & Loss account provide information on the operation of the enterprise. These include sale and the various expenses incurred during the processing state.

3.     Statement of retained earnings: explains the changes in a company's retained earnings over the reporting period.

4.     Statement of cash flows: reports on a company's cash flow activities, particularly its operating, investing and financing activities.

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TREASURY MANAGEMENT TOOLS AND TECHNIQUES

Definition:

Treasury management (or treasury operations) includes management of an enterprise's or government’s financial holdings like bonds, currencies, financial derivatives, stocks and many other securities.

All banks have departments devoted to treasury management, as do larger corporations. For non-banking entities, Treasury Management and Cash Management are sometimes used interchangeably. The treasury operations come under the control of CFO of the concern or the Vice-President / Director of Finance.

It is necessary to understand and appreciate the three distinct roles Treasury is

expected to play:

a. Liquidity Management: Treasury is responsible for managing short term

funds across currencies, and also for complying with reserve requirements (e.g. CRR)

b. Proprietary Positions: Treasury may trade in currencies, securities and other financial instruments, including derivatives, in order to contribute to Bank’s profits

c. Risk Management: Treasury will aid Management on one hand and Bank’s clients on the other hand, in managing market risk, using derivative instruments.

 These multiple roles necessitate Treasury to manage an ALM Book for internal risk management, a Merchant Book for client-related currency and derivative

transactions, and a Trading Book for managing its proprietary positions. ALM Book also includes traditional role of Treasury in liquidity management.

In an open economy, exchange rates are further influenced by macro-economic factors like relative inflation, GDP growth rate, stock markets and commodity markets. Treasury operates in markets which are almost free of credit risk, and hence requires very little capital allocation.

Secondly, the treasury activity is highly leveraged – the risk capital allocated to Treasury may range between 2% to 5% of the size of transactions handled, hence the return on capital is quite high. Treasury may do transactions similar to the ones done for the customers in forward market – buy forward and sell forward – without investing funds in actual purchase and sale of currency
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TREASURY MANAGEMENT

Treasury management (or treasury operations) includes management of an enterprise's or government’s financial holdings. It includes activities like trading in bonds, currencies, financial derivatives and also encompasses the associated financial risk management.

All banks have departments devoted to treasury management, as do larger corporations. For non-banking entities, Treasury Management and Cash Management are sometimes used interchangeably. The treasury operations come under the control of CFO of the concern or the Vice-President / Director of Finance.

Bank Treasuries may have the following departments:

• A Fixed Income or Money Market desk that is devoted to buying and selling interest bearing securities
• A Foreign exchange or "FX" desk that buys and sells currencies
• A Capital Markets or Equities desk that deals in shares listed on the stock market. (Stock Exchanges)

In addition the Treasury function may also have a Proprietary Trading desk that conducts trading activities for the bank's own account and capital, an Asset liability management or ALM desk that manages the risk of interest rate mismatch and liquidity; and a Transfer pricing or Pooling function that prices liquidity for business lines (the liability and asset sales teams) within the bank.

Banks may or may not disclose the prices they charge for Treasury Management products.

Functions of Treasury Management includes:
1. To maintain the liquidity of business

It is the main function of treasury management to maintain the liquidity of business. Without proper liquidity, it is risky for business to operate smoothly. By using cash flow analysis and working capital management. Treasury officers make good ratio of liquid assets and liquid liability.
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THE CONTRAPTION CALLED MICRO FINANCE BANK

THE CONTRAPTION CALLED MICRO FINANCE BANK

INTRODUCTION

The micro finance bank is a reincarnation of the community bank, and the community bank a product of Professor Yunis grammeen model of poverty alleviation  which was a successful programme in Bangladesh.

Prior to the introduction of community banks, were poverty alleviation interventions with such names as:

-         Better Life

-         National Directorate of Employment (NDE)

-         Family Economic Advancement Programme (FEAP)

-         National Poverty Eradication Programme (NAPEP)

-         People’s Bank etc, etc

All these programmes operated as direct intervention except the People’s Bank which operated the same way our present day micro finance banks operate.

WHAT IS A MICRO FINANCE BANK

The word micro finance is a more inclusive term which encompasses credit, savings, and capacity building, and it is more preferable by developmental finance practitioners. The purpose of which is in accordance with the 2015 Millennium Development Goal which seeks to:

-         Eradicate extreme hunger and poverty

-         Provide Universal primary education

-         Ensure  gender equality and empower women

-         Reduce child mortality

-         Improve maternal health

-         Combat HIV/AIDS, malaria and other diseases

-         Ensure environmental sustainability

-         Global partnership for development

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STRATEGY AND FINANCE MASTER CLASS

Leading Winning Teams

When an organization is performing at its best, you'll usually find that each member has clear responsibilities. Just as importantly, you'll normally see that every role needed to achieve the team’s goal is being performed fully and well. But often, despite clear roles and responsibilities, an organization will fall short of its full potential.
How often does this happen in the teams you work with? Perhaps some of your members don't complete what you expect them to do. Perhaps some team members are not quite flexible enough, so things 'fall between the cracks'. Maybe someone who is valued for their expert input fails to see the wider picture, and so misses out tasks or steps that others would expect. Or perhaps one team member become frustrated because he or she disagrees with the approach of another team members.
 People in teams tend to assume different "team roles".  A "team role" is "a tendency to behave, contribute and interrelate with others in a particular way" as to ensure the success of the team.

Leadership Styles that Drive Success

From Mahatma Gandhi to Winston Churchill to Martin Luther King to Rudolph Giuliani, there are as many leadership styles as there are leaders. Fortunately, businesspeople and psychologists have developed useful and simple ways to describe the main styles of leadership, and these can help aspiring leaders understand which styles they should use.

So, whether you manage a team at work, captain a sports team, or lead a major corporation, which approach is best? Consciously, or subconsciously, you'll probably use some of the leadership styles in this article at some point. Understanding these styles and their impact can help you develop your own, personal leadership style – and help you become a more effective leader.

With this in mind, there are many different frameworks that have shaped our current understanding of leadership, and many of these have their place, just as long as they're used appropriately. Your success as a Leader will depend on which of the under listed styles of leadership you adopt and the circumstances in which you operate.

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RISK ASSESSMENT AND INTRODUCTION TO INTERNAL CONTROL

INTRODUCTION - RISK ASSESSMENT

We face a variety of risks from external and internal sources that must be assessed. A precondition to risk assessment is establishment of objectives, linked at different levels and internally consistent.  Risk assessment is the identification and analysis of relevant risks to achievement of the objectives, forming a basis for determining how the risks should be managed.  Because economic, industry, regulatory and operating conditions will continue to change, mechanisms are needed to identify and deal with the special risks associated with change. 

There are risks inherent in any activity.  Smart managers know the potential impact and likelihood of occurrence of any number of risks, and put in place cost-effective controls to manage those risks.  External risks such as vendor fraud could compromise health and safety of staff, clients, students, patients, customers depending on the nature of business of such organization.  Internal risks such as employee incompetence, unsafe buildings or ailing computer systems also imperil an organization.. It is important to get your entire organization involved, including executives and your board.

Now, let us refer to what the new SEC (Securities and Exchange Commission, Nigeria) says in respect of Risk Assessment in Part A, chapter 10:

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RECORDS AND INFORMATION MANAGEMENT

RECORDS AND INFORMATION MANAGEMNT

A record is a document or other electronic or physical entity in an organization that serves as evidence of an activity or transaction performed by the organization and that requires retention for some time period. Records management is the process by which an organization:

• Determines what kinds of information should be considered records.
• Determines how active documents that will become records should be handled while they are being used, and determines how they should be collected after they are declared to be records.
• Determines in what manner and for how long each record type should be retained to meet legal, business, or regulatory requirements
• Researches and implements technological solutions and business processes to help ensure that the organization complies with its records management obligations in a cost-effective and non-intrusive way.
• Performs records-related tasks such as disposing of expired records or locating and protecting records that are related to external events such as lawsuits.
• Determining which documents and other physical or electronic items in your organization are records is the responsibility of corporate compliance officers, records managers, and lawyers. By carefully categorizing all enterprise content in your organization, these people can help you ensure that documents are retained for the appropriate period of time. A well-designed records management system helps protect an organization legally, helps the organization demonstrate compliance with regulatory obligations, and increases organizational efficiency by promoting the disposition of out-of-date items that are not records.

A records management system includes the following elements:

• A content analysis that describes and categorizes content in the enterprise that can become records, that provides source locations, and that describes how the content will move to the records management application.
• A file plan that indicates, for each kind of record in the enterprise, where they should be retained as records, the policies that apply to them, how long they must be retained, how they should be disposed of, and who is responsible for managing them.

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QUALITY MANAGEMENT SYSTEM

The Purpose of Quality Management Systems,

A quality management system (QMS) is defined as the “organizational structure, procedures, processes and resources needed to measure the effectiveness of producing goods and services to clients and customers.” The purpose of QMS is to develop and maintain an organizational system which provides quality assurance and audit through every area of an organization while optimizing the process of production. These processes benefit an organization and lead to customer satisfaction

(ASK FOR THE REST OF THIS PAPER)A QMS requires an organizational structure which draws out the responsibilities of executive management, operations management, divisions, departments, sections and branches, while defining a mission statement for the entire organization. QMS has paved the way for a better understanding of how organizations should be structured and how similar skills within an organization should be grouped together for cohesion and to share common knowledge. Other features of a QMS include management/employee responsibilities, resource allocation and management, employee training and customer satisfaction.
An effective QMS leads to greater profitability. After all, the bottom line of a QMS is to provide individuals who are part of the process “ownership” or “responsibility” for their input into the QMS concept. There are items which QMS have developed in modern workplaces, such as employee of the month awards, employee suggestion boxes, cash rewards for saving an organization money and decentralized decision making. All of these ideas have evolved from the QMS concept. A good QMS can also lead to employee satisfaction, which has a chain reaction effect on customer satisfaction. Employees feel integrated into the success of the organization

PROJECT MANAGEMENT MONITORING

Introduction

A project is a temporary endeavor, having a defined beginning and end (usually constrained by date, but can be by funding or deliverables), undertaken to meet particular goals and objectives, usually to bring about beneficial change or added value. The temporary nature of projects stands in contrast to business (or operations), which are repetitive, permanent or semi-permanent functional work to produce products or services. In practice, the management of these two systems is often found to be quite different, and as such requires the development of distinct technical skills and the adoption of separate management.

The primary challenge of project management is to achieve all of the project goals and objectives while honoring the preconceived project constraints. Typical constraints are scope, time, and budget. The secondary—and more ambitious—challenge is to optimize the allocation and integration of inputs necessary to meet pre-defined objectives.

As a discipline, Project Management developed from different fields of application including construction, engineering, and defense.  Two forefathers of project management are Henry Gantt, called the father of planning and control techniques, who is famously known for his use of the Gantt chart as a project management tool; and Henri Fayol for his creation of the 5 management functions, which form the basis for the body of knowledge associated with project and program  management. Both Gantt and Fayol were known as being students of Frederick Winslow Taylor's theories of scientific management. His work is the forerunner to modern project management tools including work breakdown structure (WBS) and resource allocation

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PROJECT FINANCE MANAGEMENT

FINANCIAL PLANNING

Why do we need to plan finance? Obviously, until we have decided on the answer to this question the techniques required to carry out this management function cannot be intelligently discussed.

Given the need for financial planning it goes without saying that financial planning involves plans. These plans relate firstly to the long and short term financial plans that identify what finance will be required, then to determining the kinds of finance to be utilized to meet those requirements, and finally planning where such finance shall be obtained. Short and long term financial planning and the determination of the kinds of finance to be employed will be discussed in this paper.

THE NEED FOR FINANCIAL PLANNING

First, why do we need to plan finance?

1.       The need for cash. In our modern economic environment possession of cash is essential. In most trading and virtually all manufacturing situation it is necessary to possess cash to obtain economic resources ahead of the cash that will be received from the customers buying the goods produced from these resources. This is particularly so in respect of capital equipment such as buildings or plant.

2.       Cash: an economic factor of production. As we have seen, cash is an economic factor of production. This means one must pay to acquire cash. The price one must pay to acquire cash varies, as it does with any economic factor, with supply and demand. Moreover, different “qualities” of cash (or “finance” as we should say in this context) can be acquired e.g finance can be short-term or long term, secured or unsecured, and naturally the price differs with the quality.

          Since cash is an economic factor of production it follows that in any efficient enterprise only the minimum amount of cash should be acquired, excessive acquirement leads to excessive costs and a subsequent lowering of the financial efficiency of the enterprise.

3.       The need for liquidity. If efficiency can be directly measured by how little cash is acquired, it would seem that financial management would simply involve ensuring that it is kept to the absolute minimum necessary for operations, and that which is acquired is obtained in the cheapest form. Unfortunately, however, use of the cheapest ‘quality” of cash acquired almost invariably carries with it the obligation of early repayment. If this repayment is not made then the enterprises may well be taken over by the people who provided the finance.

          There is no point in being financial efficient if such efficiency leads to the loss of the enterprise. Such a policy would be akin to under-fueling an aircraft to economic in operating costs. Financial management, then involves ensuring that there are always sufficient funds available to avoid defaulting on the payment of debt and the consequential risk of being taken over. The extent to which it is possible to do this is measured by what is termed liquidity; the more “liquid” one is, the more funds one has, or can obtain, relative to the size of the debt

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PREVENTING WORK PLACE FRAUD

PREVENTING WORKPLACE FRAUD

Dr. Richard Mayungbe , CPFA, ACFE, FICA, FICCA,MICM

INTRODUCTION:

In the present day economic structures, companies and organizations are formed for the promotion of one form of objective or the other, mostly for the purpose of profit making.

In pursuit of this objective, man, money and machinery are assembled together to form an organic whole, which revolves ceaselessly in order to actualize the intended goals.

But beautiful as this may look, man which is one of the three elements assembled as explained above is the most dangerous enemy and or the best friend to the success of the objectives. Man in this paper is a director, (co-owner), employee, supplier, or even a customer of the organization.

 Man has therefore been known to have a secret but inordinate agenda that is an addendum to the initial agenda of the organization.

More often, man is seen as constituting himself to a fraudster and a corrupt element in order to satisfy his own hidden agenda. By extension, the collective prosperity of the organization is cleverly siphoned into a few smart pockets.

We are here today to look at the problem from the point of view of a Forensic Accountant, and prescribe the necessary solution… Therefore, the title of our course this morning is “Preventing Workplace Fraud”.

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ORGANISATIONAL PEOPLE MANAGEMENT

The concept of Organisation is simply defined as two or more people working together toward one or more shared goal(s). .. This means that an organisation is an embodiment of teams.

When an organization is performing at its best, you'll usually find that each member has clear responsibilities. Just as importantly, you'll normally see that every role needed to achieve the team’s goal is being performed fully and well. But often, despite clear roles and responsibilities, an organization will fall short of its full potential.
How often does this happen in the teams you work with? Perhaps some of your members don't complete what you expect them to do. Perhaps some team members are not quite flexible enough, so things 'fall between the cracks'. Maybe someone who is valued for their expert input fails to see the wider picture, and so misses out tasks or steps that others would expect. Or perhaps one team member become frustrated because he or she disagrees with the approach of another team members.
 People in teams tend to assume different "team roles".  A "team role" is "a tendency to behave, contribute and interrelate with others in a particular way" as to ensure the success of the team.

By understanding your role within a particular team, you can develop your strengths and manage your weaknesses as a team member, and so improve how you contribute to the team. If team members have similar weakness, the team as a whole may tend to have that weakness but if team members have similar team-work strengths, they may tend to compete (rather than co-operate) for the team tasks and responsibilities that best suit their natural styles.
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RISK IN MERGER AND ACQUISITION

MERGER AND ACQUISITION: MANAGEMENT OF RISK – APPROACH AND PROCESS: USING THE BANKING INDUSTRY AS A REFERENCE

In recent years a remarkable evolution has taken place in the financial services marketplace. Modern portfolio theory and financial engineering have transformed the way risk is viewed and managed in virtually every niche of the financial services sector. In commercial banking, risk management has been transformed from a rather narrow focus on asset liability management, to a focus on the management of risk on an enterprise-wide basis.

This change in focus has had significant impacts on the role and responsibilities, and potential liabilities, of boards of directors and senior management. The management of risk has become a critical part of standards by which their stewardship is evaluated by shareholders and regulators.

The business of banking has always been primarily about intermediation, requiring the management of a variety of attendant risks. However, the kind of risks faced by banks today and how those risks are managed are being driven in new directions by a number of dynamic forces.

These include the development of new and increasingly complex products; the convergence of banking, securities and insurance; the expanding role and importance of technology; the globalization and volatility of markets; and the pressure of investor expectations. Each of these forces, as well as others, have brought the management of risk more to the forefront of the issues faced by both money center and community bankers.

The marketplace has been the driving force in risk management. From the money center banks actively dealing in derivatives products globally, all the way to the community bank on Main Street, the management of risk is taking on new meaning in the context of day-today business. Today, risk management involves sophisticated risk identification analysis, monitoring, reporting and management techniques.

Since banking is one of the most regulated of businesses, it is natural that risk management would have an impact on the way federal and state authorities approach the regulation of banks. It continues to do so. Technology permits information and capital to travel quickly in today's markets, and the technology gap seems to be widening between regulators and the markets on almost a daily basis. In many significant ways, the marketplace has largely supplanted "command and control" approaches toward bank regulation

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MANAGING CHANGE, PEOPLE AND PROCESS

Change Management Process

Approach to Managing Change

·        Identifying Key Change Issues:

Key Change Issues include (but are not limited to):

·        New Product development

·        Sales development

·        New Market development

·        Business Organization, shape, structure and processes

·         Tools, Plants, Equipment, Logistics and supply chain

·        People, management and communication

·        Strategic Partnerships and distribution routes

·        International development

·        Acquisition and disposal

In fact every organ of any institution has the key potential issue for change, which is a pre requisite in effectively optimizing organizational response to market opportunities and threat.

All change agent must be able to analyze the system in which they operate and want to bring about some change. It is important to note that any change in any part of the organization would have an impact on the other part of the system.

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LEADERSHIP FOR NEW MANAGERS

The concept of Organisation is simply defined as two or more people working together toward one or more shared goal(s). .. This means that an organisation is an embodiment of teams.

When an organization is performing at its best, you'll usually find that each member has clear responsibilities. Just as importantly, you'll normally see that every role needed to achieve the team’s goal is being performed fully and well. But often, despite clear roles and responsibilities, an organization will fall short of its full potential.
How often does this happen in the teams you work with? Perhaps some of your members don't complete what you expect them to do. Perhaps some team members are not quite flexible enough, so things 'fall between the cracks'. Maybe someone who is valued for their expert input fails to see the wider picture, and so misses out tasks or steps that others would expect. Or perhaps one team member become frustrated because he or she disagrees with the approach of another team members.
 People in teams tend to assume different "team roles".  A "team role" is "a tendency to behave, contribute and interrelate with others in a particular way" as to ensure the success of the team.

By understanding your role within a particular team, you can develop your strengths and manage your weaknesses as a team member, and so improve how you contribute to the team. If team members have similar weakness, the team as a whole may tend to have that weakness but if team members have similar team-work strengths, they may tend to compete (rather than co-operate) for the team tasks and responsibilities that best suit their natural styles.

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LEADERSHIP COURSE

·        Reviewing your role - how do others see you?

What is management style? It is how a President/Manager implements his or her views on the organization and on the role of each employee. He/she sets the tone, defines the vision, and directs the strategies of the company.

Since your management style will make or mar your success as a leader, the good news is that management style is not an inherited trait.  Therefore, developing a style that works for you and your company will benefit your career and the productivity of your team.

Knowledge of various styles of management is essential, as occasions will arise in business where the flexibility to utilize a variation of a different style will be important. The main kinds of leadership styles include:

1.     Authoritative: These leaders may be autocratic or directive. They may have a strong need to control and may not have much faith in the abilities or input of those under them. An authoritative style may be effective in a crisis, when someone has to take charge, give orders and sort out chaos. Used for long periods, it may develop too much dependency on the manager.

2.     Consultative: Leaders with teamwork tendencies may be democratic or coach-like. They encourage grassroots ideas. This middle-ground approach may bring out the best in team members. Accountability and continuing coordination are important for honing forward direction.

Hands-off: The laissez-faire attitude puts responsibility on the shoulders of employees, who may rise to the occasion. If productivity is reduced, there is a risk of the manager being out of the loop in terms of what's really going on. The manager demonstrates faith in the employees and a well-oiled machine, and may maintain an open-door policy

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CONVOCATION LECTURE - LINCOLN UNIVERSITY, CALIFORNIA

Introduction

The President and Senate of Lincoln University, President and Board of SKB Executive Business School, The Chairman of today’s convocation ceremony, Distinguished Ladies and Gentlemen.

I am highly honored to be called upon to deliver this lecture on the occasion of a special graduation ceremony of Lincoln University for the award of Master of Business Administration degree. A day like this is usually counted as a very important date in the University calendar and in the lives of the graduands and at the same time a form of motivation to intending students.

All over the world, leadership has consistently been a great challenge to Nations, Groups and Individuals in their respective drive to accomplish established tasks.

The nature of these tasks could be:

Military, Business, Management and or education as in the case of what we are doing today… Now, let us relax and explore the anatomy of good leadership as well as team building.

THE CONCEPT OF LEADERSHIP

Before we get started, let’s define leadership. Leadership is a process by which a person influences others to accomplish an objective and directs the organization in a way that makes it more cohesive, coherent and productive. Leaders carry out this process by applying their leadership attributes, such as beliefs, values, ethics, character, knowledge, and skills.

Good leaders are made not born.

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