ICPAK explains IPO refund delay

June 19, 2008
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, NAIROBI, June 19 – The Institute of Certified Public Accountants of Kenya (ICPAK) is blaming the delay in disbursing Safaricom refunds on a poor initial planning process.

ICPAK Chairman Steve Lugalia is blaming regulators Central Bank of Kenya (CBK), Capital Markets Authority (CMA) and the Nairobi Stock Exchange (NSE) for delays and inconveniences being experienced in the collection of refunds.

Lugalia said that earlier indications were that the IPO would be highly oversubscribed and plans should have been put in place to address any problems that would have arisen.

However a statement from CBK indicated on Thursday that after consultations with CMA and the Kenya Bankers Association, it has directed individuals to open an account with any bank to receive their refunds.

The statement further indicated that consultations were ongoing to come up with more instruments within which individuals could access their refunds faster.

Investors have also been allowed to cash cheques worth Sh10,000 at the National Bank, Equity, Citibank and Kenya Post Savings Bank.

Meanwhile, ICPAK has suggested that the Finance Minister Amos Kimunya may not be able to effectively balance his books if Members of Parliament shoot down the proposal to have their allowances taxed.

Lugalia called on legislators to rise to the occasion and agree to be taxed like their counterparts in other smaller economies do, in order to help their countries grow.

“These people are busy spending money on unnecessary expenses like fuel guzzlers, yet in such a small economy like Kenya all a legislator requires is a modest vehicle to move them from one point to another,” he said.

“In other small economies like ours, legislators have accepted to be taxed and they are not as highly paid as these Kenyan ones.” 

Lugalia noted that if legislators refused to be taxed, the Finance Minister would be left with a Sh800 million hole in the budget over and above the Sh126 billion deficit already in existence.

He observed that the Minister tried his best to balance this year’s budget and therefore the legislators should support him in seeing it through.

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