Financial Solutions in Kenya: Geoffrey Gitau and Co, A Leading Auditing and Accounting Firm Based in Nairobi

Interview with Geoffrey Gitau, Managing Partner at Geoffrey Gitau & Co.

Could you give us a historical background of Geoffrey Gitau and Co?

Our company started in 2011, exactly 10 years ago. This is our 11th year and we started with zero customers. Currently, we are boasting of having close to 200 audit customers and we are still growing the numbers. Our main focus is on auditing, taxation and accounting services. My first employer was an auditor, and I started my career in 2001 where I was employed as an audit assistant in a company based in Nairobi. They trained me and paid my school fees for the completion of my CPA (certified public accountant) diploma. One of my partners was my mentor and we hoped that one day we would be able to have our own firm, together with my friends. Geoffrey Gitau and Co is the true realization of the vision that we saw over 20 years ago. Currently, we have 12 employees, as well as myself.

The auditing service is an assignment that is undertaken by firms that are registered with a regulatory body. In Kenya, we are regulated by the Institute of Certified Public Accountants, and we are given licenses yearly. So you cannot practice without the annual licenses and there are stringent criteria to get the annual license. At the end of the whole audit process, we try and seek to add value to the customer by first giving them the audited report, and it does not matter whether it is qualified or unqualified, what matters the most is the management letter or points that we emulate regarding the major weaknesses that they need to keep working on or areas where they have done very well. So the management letter has been working for us, because it is a point of value addition.

The other major business or revenue earner in our firm is accounting services. Most of the customers in Kenya cannot afford a full-time accountant. Here, if you want a senior accountant who is able to post their account, and also produce the financial statement, you will not pay anything less than maybe $1,000, which is quite a fortune. So we have a department that deals with accounting so that the firms can be able to outsource the services and we can also add statutory open services. These are monthly taxes that needs to be paid based on the number of employees, for example, NHIF, NSSF, NITA, HELB, VAT and Pay As You Earn, those are taxes that are normally related to the Kenyan Authority. So most of the investors are able to concentrate on the core business and outsource the pain of filing the returns from the professionals and the pain of producing the monthly accounts to the professionals.

The other service that we are very passionate about is taxation and this is where we conduct tax health checks for big SMEs for example. Currently, tax issues are boardroom matters because the Revenue Authority has become very aggressive. Compliance is a big topic here in Kenya, because if you are not compliant, then you might as well shut your business down before Kenya Revenue Authority comes to shut it down for non compliance. That is how we come in to ensure that businesses in Kenya are performing in a way that they are compliant. In case of any change of legislation, maybe rates are going up or down like during COVID, there were so many adjustments, but we were coming in very handy to help businesses and investors navigate that aspect of taxation, so that they can be able to comply with the Kenya Revenue Authority.

We also provide other support services because we normally outsource this from our business associates, for example, business secretarial services, immigration services, and we also conduct a lot of trainings. We have partnered with some organizations like Sinapis. We normally come in to train or to coach SMEs that are coming up so that they can be able to boost their compliance with the Kenya Revenue Authority, or they can be able to do their books efficiently. Our clientele focuses on various sectors in the economy, for example, we have not for profit organizations or NGOs. We have bodies for donor funds like DANIDA and CRS. Then we also have corporates, and corporates are divided into different segments. We have bigger SMEs, we have startups and we also have companies that ordinarily maybe originating from China, the UK, the US, but setting up their space or businesses in Kenya, because the country is becoming a business hub. We come in to help them settle in and be fully compliant with Kenya Revenue Authority. And that is a niche that we want to grow so that they become big revenue and can be able to continue supporting those businesses.

Then, we have other forms of incorporation, for example, partnerships. We have limited liability partnership firms in Kenya. We also have companies that are registered through the register of societies. Those are mostly churches. And we have other companies that are registered through companies limited by guarantees. Those might be not for profit organizations, but they are not NGOs, and we handle their audits differently. So those are the customers or different aspects of customers that we deal with, including individuals. For example, individuals who want to file their own taxes or directors of similar organizations, we also extend the same support to them so that they can be compliant.

What makes your company unique?

First and foremost, it is the quality and the caliber of our employees, because we are very deliberate when it comes to recruitment. We have one policy: we would rather take more time during the recruitment, but we get the right people. We do a lot of background checks. We also ensure that before we give you a long term full contract, there is a probation period just in case you misbehave or something happens then there is a fall back. So that by the time we are confirming that this is the right employee, we will have gone through the rigorous process of recruitment. Once our employee settles in, there are trainings and orientation to make sure they align with the vision, the nature of the company and the core values. And the whole idea is to make sure that the whole staff is working as a team. There is motivation towards one common objective, and that is the growth of the company.

We also have continuous professional development, where we pay for seminars and conferences for our staff, so that they can continue increasing their knowledge in their areas of expertise. And when we have an engagement, we are very deliberate to evaluate the caliber of our customer to know the kind of audit engagement team to allocate to that customer, so that we allocate skills where the skills are needed. We also look at the cost of providing similar skills to that kind of an engagement so that you can be able to align and value the two. We grow and motivate our staff so that we can be able to add more value to our customers. We have seen this with the kind of referrals that we get from our customers. If you get a referral from a customer, that means that you did a good job to the tier 1 referral that you got for that customer. And that customer has given you a tier 2 referral and tier 2 might become a tier 3 referral. So those are the kind of motivation that we derive from the quality work that we deliver to our customers by getting other referrals from the same source.

What would you have loved to achieve in the next three years?

We want to organize ourselves like there is a bit of housekeeping to make sure that our staff is ready for the next dispensation. Currently, we have been doing a lot of automation. If we were spending maybe five or six days doing an audit manually, then we will be cutting that time by half or by 70%, if we do the automation. And currently there is an audit system that we have acquired from South Africa and we are leveraging upon automation, meaning that in the next maybe one or two years, we will be able to accomplish the same work with minimal time, so as to free more time to do research and development, or to provide additional services to our customers. Number two is the trainings and continuous developments. Then number three, we want to incorporate our organization into a limited liability partnership, where we will issue up some stake to some of the long serving employees, so that at the end of the day, the company that we are growing will be for all of us. And this is a way of giving back and also motivating our staff to work together towards achieving a common goal. Once we change the ownership and the formation and issue different stakes depending on the contribution to our staff, then the ball game will change ultimately because the issue of the sense of ownership will be settled and I will not need to motivate more staff because they will know that they own stake in the organization. So those are the three major things that we are very deliberate upon, some of them are involving a bigger budget, but there is no better way of doing it, because if you want to attract money, then you have to spend money. Number four is that we are preparing to also revamp our website so that we can be able to have a website that is more user-friendly and more interactive, so that we can be able to reach out to more customers in our digital marketing space.

So, regarding the short term goals, we are working on those four items that I have just mentioned. We have started baby steps towards achieving most of those deliverables. For example, currently we are working with an IT system provider who is working on a blueprint of how our website will look like and how interactive it will be when it is finally launched in the market. We are moving very slowly towards achieving that, but the pace is very deliberate to make sure that we are doing the right thing, so that at the end, we will be able to look back and see the kind of achievement that we have reached in the last two years or so. So we are focusing on the two years goal, but the two years deliverables and the items that we want to achieve, most of them we have already started working on, and we are on upward trajectory towards achieving the same.

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