The Nation Newspaper

Tag: KPMG

  • KPMG to banks: focus on customer service, financial stability

    African banking customers have been fairly clear about what they expect from their banks, and what they are not yet getting, KPMG report on the sector, has said.

    A customer satisfaction survey conducted by the auditing firm in Angola, Botswana, Cameroon, Chad, Côte d’Ivoire, Ghana, Kenya, Nigeria, Senegal, Sierra Leone, Tanzania, Uganda, Zambia and Zimbabwe, showed that banks in Africa will need to focus on maintaining their financial stability, while also sharpening their customer service capabilities if they hope to capture and grow their markets.

    The survey conducted in October, explained that while more than one in five respondents said their top criteria for selecting a bank is their ability to remain stable, it was attention to customer service that seemed to separate the leaders from the rest of the pack.

    It said customer care factors were seen as being among the most important indicators for many respondents, leading to 43 per cent to say that they would change their banks as a result of poor service quality.

    “Not surprisingly, therefore, customers were also quick to call for improvements in this area; around 16 per cent said they wanted to see friendlier staff while 14 per cent said they would like faster and more effective complaints resolution from their banks,” it said.

    The survey also highlights a number of other key areas where African banks could make improvements to gain market advantage. One in five respondents prioritised a reduction in wait times for transaction processing and requests as their top area for improvement while 17 per cent said they wanted to see improvements in the way services are delivered through channels.

    It said alternate banking channels are starting to gain a foothold in many markets, creating another opportunity for banks to differentiate themselves and build loyalty among customers.

    Already, more than six per cent of respondents said they would switch banks if they offered more innovative products and services versus eight per cent who said they would switch because of the proximity of branches.

    It said 94 per cent of banks’ customers voted ‘staff friendliness’ as the most important factor influencing their satisfaction with their bank. Yet, while eight in 10 expressed satisfaction with this element, only three in 10 customers said they were very satisfied with their bank staff’s knowledge of banking products and only 10 per cent indicated that they were extremely satisfied that their complaints were being promptly addressed.

    When it comes to value for money, almost one in five of Africa’s banking customers expressed dissatisfaction with the cost of maintaining their accounts while 15 per cent said they were indifferent. Respondents also said they would like their banks to be more proactive in notifying them of changes in interest rates, tariffs and terms and conditions.

    However, interest rates seemed to be the biggest pricing frustration for respondents in 12 of the 14 countries surveyed who said they were least satisfied with the rates they were offered for deposits and investments.

     

  • ALSCON: KPMG denied access to parts, equipment, says report

    ALSCON: KPMG denied access to parts, equipment, says report

    More revelations continue to pour out of the audit carried out on the Aluminum Smelter Company of Nigeria (ALSCON) by KPMG.

    The Nation learnt that the 2011 audit report showed that the company withheld information from the auditors. Besides, the company could not account for the whereabout of brand new equipment valued at N5.9 billion at the request of the auditors.

    When ALSCON was completed by Reynolds of America, several parts were brought in to keep the company running, but were never used. Upon selling the company to RUSA, the new owners took possession of the parts and equipment which they claimed had depreciated.

    When asked to produce evidence of this, RUSAL was unable to do so.

    According to the auditors, “included in stocks are storeroom supplies carried at N5.9 billion as at 31, December 2011. We were not provided with sufficient appropriate audit evidence as to the need to recognise a provision for stock obsolescence irrespective of the fact that some of the items have remained unused for several years.”

    The report added: “We were also unable to carry out alternative audit procedures to obtain sufficient appropriate audit evidence due to the inability of the company to determine stock obsolescence. Consequently, we were unable to determine whether any adjustment to this balance is necessary.”

    The auditors were also stymied when they inquired about the company’s butts (casks or barrels) carried in the books of the company at N0.4 billion as at December 31, 2011.

    The report noted: “We were not provided with sufficient appropriate audit evidence about the physical quantities of butts. We were also unable to carry out alternative audit procedures to obtain sufficient appropriate audit evidence due to the inability of the company to physically verify the quantity of butts. Consequently, we were unable to determine whether any adjustment to this balance is necessary.”

    There have been allegations that ALSCON was grounded by RUSAL with the Bureau of Public Enterprises (BPE) doing nothing about it despite being on the board of the company. An example of such huge expenses engaged in by the company was recorded in the report.

    The report stated that the company spent N2.4 billion on administrative expenses in 2011, comprising N586,464,000 as staff cost; N126,759,000 on travel and freight expenses; N192,000 on Board expense and N199,794,000 as net foreign exchange loss, among others.

    The company recorded a loss before taxation in 2011, which decreased by 94 per cent from N4.5 billion in 2010 to N0.27 billion in 2011. The decrease, the report said, “is mainly as a result of decrease in cost of sales, which resulted from write-back of prior year cost of sales adjustment and inventory adjustment passed during the year to correctly state the cost of sales and storeroom supplies.”

     

     

     

     

  • Zenith named most customer-focused bank

    Zenith named most customer-focused bank

    Zenith Bank Plc. has emerged the Most Customer-Focused Bank in the country.

    Global professional services organisation,  KPMG in its 2013 Banking Industry Customer Satisfaction Survey (BICSS), ranked  Zenith Bank’s best-in-class service delivery as the best in both the retail and corporate banking categories.

    The ranking was on  the basis of a Customer Satisfaction Index (CSI) which took into account key factors like, Convenience, Product/Service Offering, Transaction Methods and Systems, Pricing and Customer Care. The survey covered more than 14,000 retail customers, 3,000 SMEs and 400 corporate/commercial organizations across Nigeria.

    The retail customers surveyed mentioned excellent customer service (35%), financial stability (26%), image and reputation (11%), employer requirements (10-%) and proximity of branches (10%) as their top reasons for maintaining banking relationships.

    The  corporate/commercial organizations mentioned excellent service (29%), financial stability (27%), image and reputation (8%), banking support of business (7%) and efficiency of credit processing (8%) as the top reasons for maintaining banking relationships.

    In the current edition of the survey, KPMG introduced a survey to understand the perception of young professionals on how they intend to interact with their banks in the future – about 50% preferred not to visit a branch. This fits into Zenith bank’s current disposition as a leading technological advanced financial services provider in Nigeria.

    last week, Zenith Bank consolidated its position in the  Nigeria’s banking industry with an  operating result that indicated excellent performance in all parameters .

  • ALSCON is bankrupt, says KPMG

    ALSCON is bankrupt, says KPMG

    • EFCC may intervene

     

    The Aluminum Smelter Company of Nigeria  (ALSCON) is bankrupt, an audit by KPMG has revealed.

    Details of the report made available to The Nation put the value of ALSCON as at December 31, 2011 at $89.9 million, whereas the company has accumulated a debt in excess of $135 million, or N22 billion.

    According to the report, entitled: Aluminum Smelter Company of Nigeria Plc Financial Statements – December 31, 2011 together with directors’ and auditor’s reports, under current liabilities, said ALSCON received a short term loan of N21.348billion in 2011.

    The report noted that the short term loans of N18,173,266,000 were given to DAYSON Holdings Limited;RUAL Limited N2,719,758,000 and SEA CHAIKA Corporation, N455,323,000, totalling N21,348,347,000.

    According to the report, “the loan agreements provide that the loans shall bear no interest, except where the company fails to fully repay the loan at the maturity date, in which case the company would be obliged to pay interest on the outstanding amount of the loan at the rate of two per cent per annul.”

    It further revealed that the movement in the loan balances during the year showed that N17.513billion was the balance at the beginning of the year, while N3.042billion was the amount of loan drawn down during the year. There was no repayment of the loan during the year and there was an exchange difference of N792,348,347,000, totalling N21,348,347,000.

    The President of BFIGroup, Dr. Reuben Jaja, confirmed that ALSCON was, indeed, bankrupt. He said BFIG had also seen the audit and the N21.3 billion short term loan that was in the books of the company.

    Dr. Jaja said BFIG will invite the Economic and Financial Crimes Commission (EFCC) to investigate what led to the insolvency of ALSCON, and what the money was used for. He wondered what the loan could have been used for since there were neither machinery upgrades, nor acquisition of new machines.

    He lamented that ALSCON has only N94.5 million as cash in the bank and at hand as at the time of the audit. Jaja said he was worried that the condition of the company might be worse, two years after the audit.

    He expressed dismay that the Bureau of Public Enterprises (BPE), which has a seat on the board of ALSCON, should have been aware of this indebtedness before offering to sell the firm to BFIG for $450 million.

    BFIG, he said, would also invite the EFCC to investigate what RUSSAL had done with the $120 million credit the Federal Government extended to the Russians for the dredging of the Opobo/Imo River estuary since 2004.

    He alleged that to claim the $120million credit the Federal Government promised it for the dredging of the Imo River, RUSSAL brought Autonomous Non-Profit Organisation Marine Technologies and Safety from Russia to claim the money.

    The BFIG president reiterated that “the BPE’s claims that BFIG did not make the payments for ALSCON and also failed to sign the Share Purchase Agreement (SPA) are false.”

    He said the group had signed the mutually agreed SPA which was prepared and delivered to it by the BPE and the group in turn hand delivered the signed SPA to the privatisation agency with five days to spare and also requested for the BPE’s bank details so that it could make the initial payments but that the BPE refused to release it’s bank details.