morre wrote:accelriskconsult wrote:Ericsson wrote:This is a good move by Kenya Re in strengthening its risk management and appeal to irs customers which in turn boosts its returns and profits.
It is the wrong move. They should instead strengthen their risk department by having risk represented at the senior most level and improving the skills of the staff.
I am from a big 4 background and have worked in insurance, in audit and risk and I can tell you that KPMG staff will not have the skills required to evaluate Kenya Re's risk department. They are better off hiring consultants who may have passed through audit but moved in to business and acquired the skills on how a business runs, the industry it operates in, systems and processes.
Risks such as reputation loss, fraud, balance sheet management (need actuarial skills for this), Asset Liability mismatches, systems failure, business continuity...big 4 firms may say otherwise but they cant afford the calibre of individuals with the necessary experience.
They hire sharp graduates but cant afford to keep them and majority leave after only 3 years. Kenya Re will most likely get a team composed of a senior consultant - (3 or 4 years), a new recruit and a manager who has may be 8 or so years. Note that the actual work is performed by the new recruit under the supervsion of the Senior consultant ( charge out rates per hour of between Sh 4,500 and Sh 10,000). A partner costs in excess of Sh 30,000 per hour these days so he will spent minimum time on your project.
It is the wrong move; they wont get value for money.
KPMG has so many departments ...this task will fall into the Risk consulting docket... i can tell you that there are very qualified and experienced staff there and that Kenya re will get value for their money... looks like your background is in audit(assurance) and that you quit after the 3 years you are talking about but as much as staff turnover is high, teams are balanced in terms of experience and knowledge and value is often delivered...
Actually no.
This is my 12th year working. I worked 6 years in the big 4 both in Kenya and the western world. I have also worked in the insurance and wealth industry for the last 6 years. I know that KPMG has many departments and as matter of fact I have severally poached staff from there. Additionally, the group I work for has in the past contracted various types of project to KPMG, Deloitte, EY and even PwC (before I joined)
Sample this;
ERP project worth Sh 150m- evaluation of vendors outsourced to xxxx (one of the big 4). Selection bungled and project abandoned after 3 years and Sh 75m written off. Reason - big 4 firm recommended the wrong vendor.
Tax work outsourced to one of the big 4 for 3 years with minimal involvement of management - result - Sh 69 m in penalties assessed by KRA. Firm had neglected advising company on allowable expenses.
ERP project worth Sh 60 million in Uganda - Vendor selection handled by yyyy big 4 firm - Project implementation only at 40% after 6 years. The company has given up on full implementation. So far fixes have cost the company in excess of Sh 180 m.
In all the cases cited above, there is evidence that the firm never really understood the company's business. Consultants in many cases will not admit that they understand nothing about your business.
Who do you think did risk assessments for the likes of KCB, Stanchart, IFC etc when they lend to Panpaper Mills?