Common Mistakes in Year-End Closing Procedures
Impact of Internal Audit on Corporate Governance

2023; where did the year go?

Today is December 28, 2023, I am dumb founded to explain where the year went, the days were long, but the year was short! In the collective consciousness of many Kenyans, 2023 has etched itself as the year of taxes, fines, fees and whatnots; and so do I. As the year wraps up, and in my continuing tradition, here are some great reads, cherished artifacts that made it to my book rack.

Emotional, the new thinking about feeling – Leonard Mlodinow

We are all perplexed with how feelings work. While rational thought allows us to draw logical conclusions based on our goals and relevant data, emotions operate at a more abstract level. The author takes the reader on an exploratory journey of what lies deeply buried in that mysterious phenomenon that we call feelings, moving from early philosophical thought to modern science. There is a lot to glean.. The message in this book is that the primary function of all emotions is to help you discover the lessons in every situation and move toward your goal. The author puts emphasis that you should appreciate and cherish your feelings and get to know your particular emotional profile, for once you are self-aware, you can manage your feelings so that they always work in your favour.

The book is written in a distinctly elegant manner and enlivened with loads of stories. I liked it that the story of the greatest sporting upset has been framed from an emotional perspective; if you are not familiar with the “Buster” Douglas match, you can read it here.

No Logo – Naomi Klein

This book is a resistance to corporate goliaths, the multinational mindset and the globalization of consumer culture. (it easily reminds me of the book company of one by Paul Jarvis). Branding has become far more ubiquitous and intrusive, sprouting like green weed on every corner. It was not always like this – starting in the mid-1980s, management theorists sprouted a seemingly innocuous idea – that corporations must primarily produce brands as opposed to products. Why deal in a commodity? Something that can be copied. Why not deal with something ephemeral, something warm, something personal? Corporates then went on a prowl for creative new ways to build and strengthen their brand images. “Consumers are like roaches – you spray them and spray them again and again.”

Soon after in 1988, Philip Morris purchased Kraft food for $12 billion – six times above its paper valuation, what had previously been abstract and unquantifiable now had a name “brand equity.” Naomi writes with bursting frustration how this new religious cult has led to the exploitation of cheap labour, environmental degradation, and disregard for human rights in the pursuit of brand glory and profits. If you need a sobering understanding of the global economy and how corporations have grown so big to supersede governments, this is the book.

Careful! – Steve Casner

This book is about risk, for anyone interested in understanding the intricacies of human behaviour and the art of navigating a world fraught with risks. Risk is what lets us accomplish things that few others have accomplished, risk is what allows us to have a little fun. This is a book that challenges conventional wisdom about safety. The author, a risk management expert, takes readers on an oft ignored path – to question their assumptions on how to navigate a world filled with potential hazards. For example did you know that humans are not good at multi tasking?, in fact psychologists call it task switching. The very idea of doing two things at once you end up not doing anything well and you could get badly hurt.

We have come to the end of a really good run” why? Because Our world inundated with information, we are filling our world with distractions, the potholes and mud puddles of life are waiting for us. To be careful is an intellectual challenge for each of us, a challenge for humble humans with less than perfectly rational minds to think differently in an increasingly complex world. Being careful is hard – find out how to do the hard.

The spider network – David Enrich

This is a book about the criminal enterprise that wall street breeds from time to time embodied in greed, recklessness, and hubris. At its epicenter is Tom Hayes, a mathematical genius. The storyline starts with possibly the world’s most important number – the libor and the calculated manipulation orchestrated by an insular tight-fitting team with an aggressive will to win. Trained like bloodhounds to exploit any advantage, whether that edge was a naïve and gullible client, a superior product, exotic sounding financial instruments (derivatives), or simply pushing an envelope higher up. This web was obsessed with numbers and profits, with no ethical guard rails, eager to use other people as tools for self-advancement and finally culminating in the financial world on its knees.

Enrich’s work is a masterclass in investigative financial writing, revealing a sordid chapter in financial history with cinematic flair. For those seeking both entertainment and enlightenment this book delivers both, it will have you on tenterhooks from cover to cover.

Noise – Daniel Kahneman and others

Kahneman is an accomplished intellectual and the winner of several prestigious awards on the science of thinking and decision making. He is a teacher I truly look up to. This book is about error in judgement – Noise. Noise is found in practically all human decisions; medical diagnosis, business forecasting, hiring decisions, court rooms etc. Wherever there is a judgement, there is noise and sometimes it can be shamefully high. It is outrageous that two different people convicted of the same crime end up with radically different penalties. Noise can produce great unfairness.  Some noise is inevitable, no two peas in the same pod are truly identical but to improve the quality of our judgment, we need to overcome noise – easier said than done.

This is a technical book, those familiar with decision science and mathematical modelling will have it easier however I must be quick to mention that an enduring characteristic of a great teacher is that he uses simple language, the authors have gone to great lengths using a multi-disciplinary, well-rounded exploration of the subject to appeal to a large audience. This is a book for anyone seeking to improve their decision-making skills.

Kwaheri 2023

If you have read this far, thank you for your indulgence. I want to leave you with wisdom from stoic philosophy “To take charge of your life, learning to work on those things that are within your power to accomplish and not to waste energy on things you cannot control.” There are no miracles, improving yourself takes constant work and effort.

Finally, I wish you a safe crossover and happy new year 2024 and similar to the report they gave to Moses, may it be so with you too and your loved ones.

Numbers 31:49 “And they said unto Moses, thy servants have taken the sum of the men of war which are under our charge, and there lacketh not one man of us”.

CPA Francis Mungai

The author is Head of Tax and Client Services at FH Consulting LLP

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