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ACCK : good Revenue Poor Profit
VituVingiSana
#21 Posted : Tuesday, March 23, 2010 10:27:37 AM
Rank: Chief


Joined: 1/3/2007
Posts: 18,118
Location: Nairobi
@GG - Same here... Somens did the OpenView deal to show they are open to acquisitions... Well, henry njoroge acquired the cash... so someone won & it wasn't the AK shareholder!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Djinn
#22 Posted : Tuesday, March 23, 2010 1:25:16 PM
Rank: Elder


Joined: 11/13/2008
Posts: 1,565
the writing has been on the wall for some time now (feel free to scour the archives)

1 - cheaper wholesale international capacity (fibre) has allowed new and seemingly small players to package comparable services at lower prices (Zuku, Tangerine, etc etc).
2 - Unified licences have thrown the doors open - everyone can now play in each others sand pits - woe unto those that do not evolve.
3 - Investing in a meagre 1.25% in TEAMS when everyone else was taking a big slice (Safaricom 20%, Telkom 20%, Zain 10%, Wananchi/Zuku 10%, etc)
4 - Investing in FTTH - hmmm....ok, so all the apartments in Kileleshwa, Lavington, Westlands have fibre - but no one is going to get connected if they can buy a USB modem for less than 3k and pay as they go (rather than pay monthly). Access@home is too costly - they should take it off the shelf at Nakumatt westgate (or have they already?) The battle for home users/students/SME's is now being won by mobile operators. Even Telkom have some ADSL offering for those with a copper fixed line - much faster. 5 - The battle for corporates is still one they could continue to wage - pricing, quality of service, advanced services, etc will be key.

Overall I'd say not only is the slice shrinking but overall the internet access cake is shrinking for all telcos though the data comms cake is in the oven ready for those that are ready.
sparkly
#23 Posted : Tuesday, March 23, 2010 9:45:40 PM
Rank: Elder


Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
VituVingiSana wrote:
@sparkly - Its allowed under Kenya's tax laws... It is not a 'science' where I can prove a theorem...

The best I can do is to refer you to a knowledgeable accountant in Kenya...

@vvs he he he, this accountant might turn out to be yourself
Life is short. Live passionately.
VituVingiSana
#24 Posted : Tuesday, March 23, 2010 11:10:08 PM
Rank: Chief


Joined: 1/3/2007
Posts: 18,118
Location: Nairobi
sparkly wrote:
VituVingiSana wrote:
@sparkly - Its allowed under Kenya's tax laws... It is not a 'science' where I can prove a theorem...

The best I can do is to refer you to a knowledgeable accountant in Kenya...

@vvs he he he, this accountant might turn out to be yourself

LOL... not unless you pay me!
Anyway, just grab an accounting textbook BUT I want to caution you that Taxation is no logical!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
stock.enigma
#25 Posted : Wednesday, March 24, 2010 8:07:53 AM
Rank: Member


Joined: 8/14/2009
Posts: 244
Turnover-cost of sales-admin expenses=EBITDA
EBITDA-depreciation-interest expense=PBT
PBT-tax=PAT

No need to pay an accountant for that
VituVingiSana
#26 Posted : Wednesday, March 24, 2010 9:47:02 AM
Rank: Chief


Joined: 1/3/2007
Posts: 18,118
Location: Nairobi
stock.enigma wrote:
Turnover-cost of sales-admin expenses=EBITDA
EBITDA-depreciation-interest expense=PBT
PBT-tax=PAT

No need to pay an accountant for that

@sparkly did not trust me so... he wanted a 2nd opinion but I did not have michael waweru's number...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
sparkly
#27 Posted : Wednesday, March 24, 2010 10:34:48 AM
Rank: Elder


Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
stock.enigma wrote:
Turnover-cost of sales-admin expenses=EBITDA
EBITDA-depreciation-interest expense=PBT
PBT-tax=PAT

No need to pay an accountant for that


@stock.enigma not that simple.

Taxable profit=Accounting PBT+Depreciation-Capital Allowances.(add and deduct other taxable/ non-taxable incomes and expenses)

Capital allowances include: Wear&Tear (on machinery), Investment deduction (on factories and manufacturing equipment), etc

Rates of Capital Allowances may be higher or lower than depreciation hence deferred tax.

Company may be depreciating assets like plant and lease hold property while there are tax no capital allowances applicable, hence permanent differences, in the accounting profit base and the taxable profit base!

Therefore depreciation per se does not mean less taxes.
Life is short. Live passionately.
VituVingiSana
#28 Posted : Wednesday, March 24, 2010 11:07:49 AM
Rank: Chief


Joined: 1/3/2007
Posts: 18,118
Location: Nairobi
@sparkly - LOL... I agree with you but (overall) depreciation can be used to reduce taxable income...

What folks should understand is that depreciation also means REAL losses of 'value' which often need replacement by re-investing...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
sparkly
#29 Posted : Wednesday, March 24, 2010 11:52:07 AM
Rank: Elder


Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
VituVingiSana wrote:
@sparkly - LOL... I agree with you but (overall) depreciation can be used to reduce taxable income...

What folks should understand is that depreciation also means REAL losses of 'value' which often need replacement by re-investing...


@vvs i agree with your second paragraph that depreciation is a very real expense.

But ...LOL, on the first one, you are proving to be very slippery...
Life is short. Live passionately.
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