Challenges and Impediments to Accountability; Lessons for the Kenyan

Accountant

CPA Denish OsodoDirector, Internal Audit

Safaricom Limited, Kenya

Uphold . Public . Interest

What is Accountability? Working

Definition

Accountability in Ethics and Governance

In ethics and governance, accountability is answerability, blameworthiness, liability, and the expectation of account-giving.

As an aspect of governance, it has been central to discussions related to problems in the Public Sector, Nonprofit And Private

(Corporate) And Individual Contexts.

Accountability in LeadershipIn leadership roles, accountability is the acknowledgment and assumption of responsibility for actions, products, decisions,

and policies including the administration, governance, and implementation within the scope of the role or employment

position and encompassing the obligation to report, explain and be answerable for resulting consequences.

Accountability in Accounting

Accountability is the responsibility of either an individual or department to perform a specific function in accounting.

Examples:-

• An auditor reviewing a company's financial statement is responsible and legally liable for any misstatements or

instances of fraud.

• Accountability forces an accountant to be careful and knowledgeable in their professional practices, as even

negligence can cause them to be legally responsible.

Accountability as a national value of governanceConstitution of KenyaChapter 2 – The Republic10. National Values and Principles of Governance

(1) The national values and principles of governance in this Article bind all State organs, State officers, public officers and all

persons whenever any of them --

(a) applies or interprets this Constitution;

(b) enacts, applies or interprets any law; or

(c) makes or implements public policy decisions.

(2) The national values and principles of governance include:-

(a) patriotism, national unity, sharing and devolution of

power, the rule of law, democracy and participation of

the people;

(b) human dignity, equity, social justice, inclusiveness,

equality, human rights, non-discrimination and

protection of the marginalised;

(c) good governance, integrity, transparency and accountability; and

(d) sustainable development.

The accountancy profession must provide trust and accountability

Accountability reflections

The Accountants Act 2008Section 30 of the accountants Act 2008, the professional conduct of accountants

ICPAK professional code of ethics section 100.1A distinguishing mark of the accountancy profession to act in the public interest. A professional

accountant’s responsibility is not exclusively to satisfy the needs of an individual client or employer.

ICPAK professional code of ethics section 200.3

The threats to accountants’ responsibility and

accountability to the public interest when performing

professional work.

Threats of : Self Interest, self review, advocacy, Familiarity ,

intimidation

International Federation of Accountants ( IFAC)

The decisions and behaviors of accountants should reinforce

good governance and ethical practices, promote ethical

culture, foster trust and transparency, bring credibility and

value to decision making, and present a faithful picture of

organizational health to stakeholders.

Our profession is hinged on trust and accountability4

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In high accountability cultures.

Accountability has a direct relationship to prosperity

Have a look at the Tag lines – Communication to Stakeholders!!!

Broken promise by professionals??6

Market Headlines

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Challenges to Accountability

• Ethical codes for professional accountants globally compels professional accountants, regardless of the roles that they perform.

• However, Compliance with the fundamental principles may potentially be threatened by a broad range of circumstances.

Weak and/or Incompetent Actors - Legislation, Prosecution, Judicial Systems and Citizens

Cultural Excuse

Absence of synergies from the Multiple agents of Good Governance

Corruption - Theft

Organisation Structure Design

High level Discretion, Privacy, Secrecy and Concealment of Information in Society

Absence of Consequence Management

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I AC

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The imperative move from Responsibility to Accountability

Accountants must fast track progression from a responsibility point to a position of answering for

results produced.

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I OW

N IT

. Responsibility (Before Phase)

A before- the- fact mindset of personal ownership and commitment to a result

Self Empowerment

(During Phase)

Taking action and risk to ensure the achievement of the result.

Accountability

(The After Phase)

A personal willingness after -the -fact to answer for results produced.

“Back to basics of accountability ” - Code Of Ethics For Professional

Accountants

•A professional accountant should be straightforward and honest in all professional and business relationships.

Integrity

• Devoid of bias, conflict of interest or undue influence of others to override professional or business judgments.

Objectivity

• Acting diligently and continuing duty to maintain professional knowledge and skill at the level required to ensure that a client or employer receives competent professional service based on current developments in practice, legislation and techniques.

Professional Due Care

• Respect the confidentiality of information acquired as a result of professional and business relationships and should not disclose any such information to third parties without proper and specific authority unless there is a legal or professional right or duty to disclose.

Confidentiality

• A professional accountant should comply with relevant laws and regulations and should avoid any action that discredits the profession.

Professional Behaviour

How often do you reflect on these fundamental principles of our profession?

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Key Lessons

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• What should you / your organisation be accountable for?

• To who should you be accountable?

• In what form should you fulfill accountability obligations?

• All work in public interest must be transparent

• All your actions will be on the screen one day. Will you be proud watching?

• Governance and Ethics is the next frontier- will you be in it? Will the accountant provide the

lead?

Effective leadership is Central to Accountability

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