Blog – Page 19 – Skytrend Consulting

2011-2019 Finances of NDDC to be audited

Skytrend Consulting Blog

Femi Adeoya

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October 17, 2019

2011-2019 Finances of NDDC to be audited

Nigeria’s President, Muhammadu Buhari.has ordered a forensic audit of the finances and operations of the Niger Delta Development Commission (NDDC) from 2001 to 2019, following persistent criticisms of the operations of the organisation.

The order was given on Thursday at the State House, Abuja, when he received governors of the states that make up the commission, led by Governor Seriake Dickson of Bayelsa State.

Scammers hack UBA server, cart away N752m

The president said what was presently on the ground in the South-south region did not justify the huge resources that had been made available to the organisation.

He said,

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“I try to follow the Act setting up these institutions especially the NDDC. With the amount of money that the Federal Government has religiously allocated to the NDDC, we will like to see the results on the ground; those that are responsible for that have to explain certain issues.

“The projects said to have been done must be verifiable. You just cannot say you spent so much billions and when the place is visited, one cannot see the structures that have been done. The consultants must also prove that they are competent.”

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“I am acutely aware, with my experience, that projects in your area are very expensive; that is why if any job is given, we must make sure that the company is competent and has the capacity to do it well with experienced consultants”, he said.

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

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PAYE: How to calculate personal income tax

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Job announcement for Nigerian Navy DSSC recruitment 2019

Skytrend Consulting Blog

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October 17, 2019

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Job announcement for Nigerian Navy DSSC recruitment 2019

The Nigerian Navy has commenced the recruitment of graduates and HND holders through the Direct Short Service Commission (DSSC) Course 27.

Applications are hereby invited from suitably qualified Nigerians for enlistment into the Nigerian Navy through the Direct Short Service Commission (DSSC) Course 27.

Nigerian Navy recruitment for graduates, October – November 2019

The departments and entry requirements are listed below:
Recruitment Announcement for AICL

1. Seaman:
BSc/HND in the following disciplines:

a. Nautical Sciences.
b. Criminology.
c. Psychology.
d. Sociology.
e. Forensic Sciences.

Membership of relevant professional bodies will be an added advantage.

2. Accounts and Budget:
Bachelor’s degree or HND in Accounting/Banking and Finance. Membership of professional bodies like ICAN, ANAN, ACMA, ACCA, ACA will be an added advantage.

3. Chaplain:
Bachelor’s Degree in Theology from a registered institution of theology from either of the following:

a. Catholic Mission.
b. Protestant Mission.

Applicants must have completed 2 years apprenticeship in Apostolic Ministry and be recommended from pastoral missions. In addition to qualifications required, applicants must be of male gender and duly ordained clergy of their respective Christian faith.

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4. Education:
Bachelor of Education (B.Ed)/ B.Sc Ed in relevant fields. Holders of first degree with PGD Education in the following fields are also eligible:

a. English Language.
b. Mathematics.
c. Physics.
d. Chemistry.
e. Biology.
f. Bio chemistry.
g. Microbiology.
h. History.
i. Library Science (B.Sc).
j. Computer Science.
k. Guidance and Counseling.
l. French Language.
m. Chinese Language.
n. Arabic Language.

5. Engineering:
B.Sc or B Eng qualifications in the following fields:

a. Naval Architecture/Ship Design.
b. Mechanical/Marine Engineering.
c. Electrical/Electronic Engineering.
d. Aircraft Engineering/Aeronautical Engineering.

Membership of Nigerian Society of Engineers (NSE) and Council of Registered Engineers of Nigeria (COREN) will be an added advantage.

6. Human Resource Management:
B.Sc, BA, HND or equivalent qualification in:

a. Human Resources Management.
b. Personnel Management.
c. Public Administration.

Businesses With Less Than N25m Turnover Are Now VAT Exempt

Membership of National Institute of Management and other relevant bodies will be an added advantage.

7. Hydrography:
B.Sc or HND in the following fields:

a. Cartography.
b. Surveying/Geoinfomatics.
c. Geophysics.
d. Physical Oceanography.
e. Geology.

Membership of National Institute of Statistics or proficiency in Computer Programming/Data Analysis would be an added advantage. Applicants with B.Sc degree in Physics and Mathematics must possess a Post Graduate Diploma in Land Survey to be eligible.

8. Imam:
BA/MA in Islamic Studies in the following:

a. Islamic Studies (Qira’at).
b. Islamic Studies (Hadith).
c. Islamic Studies (Jurisprudence).
d. Islamic Studies (Theology).
Diploma in Counseling Psychology will be an added advantage.

Skytrend Consulting Unveils HR, Recruitment Services

9. Information:
B.Sc or HND in the following fields:

a. Mass Communication.
b. Journalism.
c. Public Relations.
d. Printing Technology.
e. Cinematography.
f. Television Production.
g. Computer Technology (Desktop Publishing).
Membership of Nigerian Institute of Public Relations will be an added advantage.

10. Information and Communication Technology:
B.Sc/B.Tech/ B.Eng in Computer Science or Computer Engineering. Priority will be given to candidates with relevant qualifications in:

a. Website Development and Management.
b. Networking and Network Administration.
c. Programming Multimedia and Software Development.
d. Server and Database Administration.
e. Information and Cyber Security.
Certification in relevant fields will be an added advantage.

11. Medical:
The following medical fields with requisite entry qualifications are available:
a. Consultants: Must be a fellow of National Postgraduate Medical College or West Africa College of Physicians or Surgeons. Must possess current practicing license of the Medical and Dental Council of Nigeria. Candidate’s age limit is 40 years by 20 February 2020.
b. General Doctors/Dental Surgeons: MBBS, MBBCh or equivalent. Must be fully registered by the Medical and Dental Council of
Nigeria and possess a current practicing license.
c. Pharmacy:B.Pharm/Doctor Pharmacy degree and full registration with the Pharmacy Council of Nigeria as well as have a current
practicing license.
d. Medical Lab Science:Either a BMLS or AIMLS/ equivalent and be fully registered with the Medical Laboratory Scientist
Council of Nigeria as well as possess a current practicing license.
e. Dental Therapist: HND Dental Therapy must possess current professional practicing license.
f. Radiographer: Minimum of BSc/HND in Radiography with current practicing license.
g. Physiotherapy: B. Physiotherapy or BMR (Bachelor of Medical Rehabilitation). Must be registered with the Medical Rehabilitation Therapist Registration Board of Nigeria (MRTB) and possess a current practicing license.
h. Optometry:Doctor of Optometry. Must be fully registered optometrist, dispensing optician by the Optical Council of Nigeria and have a current practicing license.
i. Medical Records/Health Information Management:
Minimum of BSc/HND required with current practicing license.
j. Dietician: B.Sc or HND Dietician/Nutrition. Must be registered with Dietetics Council of Nigeria with current practicing license.
k. Clinical Psychology: BSc/HND in Clinical Psychology and Applied Psychology, with current practicing license.
l. Biomedical Engineer:BSc/HND in Biomedical Engineering with current practicing license.
m. Public Health Officer:BSc/HND in either Environmental Health or Community Health Information and Education. Must be
fully registered with the Environmental Health Officers Registrations Council of Nigeria (EHORCON) and possess a current practicing license.
n. General Nursing/Midwives:B.NSc RN/RM with current practicing license. Post basic qualification in any of the following fields will be an added advantage:

(1) Accident and Emergency Nurse.
(2) Intensive Care Unit Nurse.
(3) Peri-Operative Nurse.
(4) Ophthalmic Nurse.
(5) Dialysis/Renal Nurse.

m. Hospital Administration: BSc/HND Hospital Administration with current practicing license.

12. Music:
BA/HND in Music. Proficiency in any musical instrument will be an added advantage.

13. Sports/PT:
BA/HND in Physical & Health Education or Human Kinetics and Health Education. Proficiency in any physical sport will be an added advantage.

14. Logistics:
BSc/HND/B Eng in the following fields:

a. Transport Management.
b. Economics, Business Management or Marketing.
c. Architecture.
d. Catering/Hospitality Management.
e. Civil Engineering.
f. Quantity Survey.
g. Structural Engineering.
h. Estate Surveyor and Valuers.
i. Final Certificate of Nigerian Institute of Transport Technology.

15. Legal Service:
LLB and BL (Call to Bar Certificate and a minimum of 3 years post qualification experience required). LLM in International Maritime Law, International Law or Forensic Law is an added advantage.

GENERAL INFORMATION TO CANDIDATES

1. Applicants are warned against giving false information or tendering fake certificates. Any false information or fake certificates discovered at any stage will lead to disqualification and subsequent prosecution of the applicant.

2. Applicants must possess a minimum of Second Class Upper Division for holders of First degree andUpper Credit for HND holders. Computer literacy will be an added advantage in all fields.

3. Applicants must possess certificates of full registration with their respective statutory professional bodies in Nigeria.

4. Applicants who obtained credentials from foreign institutions should ensure the certificates are authenticated by the Federal Ministry of Education.

5. All applicants must present O’level West African Examination Certificate (WAEC), in addition to any other results such as NECO. Credit in Mathematics and English is compulsory.

6. NYSC discharge certificate or letter of exemption from NYSC is a compulsory requirement for enlistment.

7. Male applicants must not be less than 1.68 meters tall while female applicants must not be less than 1.65 meters tall.

8. Applicants should be between 22 and 28 years of age by 20 February 2020. Except Chaplains/Imams and Medical Consultants who should not be more than 30 years and 40 years respectively.

9. Serving personnel, Soldier/Rating/Airman, and other paramilitary services personnel must obtain a letter of attestation duly signed by the
heads of their units.

10. Applicants will be shortlisted for a qualifying aptitude test. The date and time of the aptitude test will be communicated via this website.

11. Applicants are to choose any of the following centers for the qualifying aptitude test:

a. Abuja Centre:

(1) Army Day Secondary School, Mogadishu Barracks.

(2) Command Day Secondary School, Lungi Barracks.

b. Bauchi Centre:

Command Day Secondary School, Shadawanka Barracks.

c. Owerrinta Centre:

Nigerian Navy Finance and Logistics College, Owerrinta, Imo State.

d. Lagos Centre:

(1) Nigerian Navy Secondary School, Navy Town Ojo.

(2) Navy Town Secondary School, Navy Town Ojo.

e. Port-Harcourt Centre:

(1) Nigerian Navy Secondary School, Borokiri.

(2)AirForce Secondary School, 115 Special Operations Group, Air Force Base.

f. Sokoto Centre:

Army Day Secondary School, Giginya Barracks.

12. Applicants are to appear for the Aptitude Test with the following:

a. Photocopies of Degree and NYSC Discharge Certificate.

b. Parent/Guardian Consent Form.

c. Acknowledgement Form.

13. Applicants are to note that the entire enlistment process is free of charge and they should refrain from giving money to any individual under any guise.

SUBMISSION OF FORM

14. On completion of the application form, applicants are advised to click‘SUBMIT’ on the portal to generate the applicant’s Transaction ID. Applicants are thereafter advised to print out a copy of the ‘Application Summary’. For technical support, call 08159999011and 09018611774 between 0800 and1700 hours only.

To apply or get more information, interested candidates should visit requirement for joinnigeriannavy.com

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

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Skytrend Consulting Unveils HR, Recruitment Services

Skytrend Consulting Blog

Joy Ojumu

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October 17, 2019

0

Skytrend Consulting Unveils HR, Recruitment Services

Skytrend Consulting Ltd, a business development and accounting solutions company located at the heart of Lagos has unveiled human resources and recruitment services.

Skytrend Consulting seeks to help small and medium sized organizations meet their human capital needs with the most resourceful candidates.

“We helps organizations reach candidates across the web and different locations, improve their employment brand, and generate a consistent pipeline of talent that can ultimately be hired for our client’s success, Femi Adeoya, the team Lead Partner says in a statement.

Speaking on the launch, Joy Ojumu a senior Client Manager adds, “Our business pedigree and clients’ experience coupled with a reputation for building long-term relationships with key clients stand us out”.

The firm also offers a wide range of creative accounting and financial services to organizations geared towards planning and optimizing their cost, facilitating business growth and improving steady profitability. This is achieved with the use of tailored and well tested business strategy that identifies and build on the strength of our clients’ organisation.

The statement adds that organizations interested in recruiting qualified, experienced and result oriented staff should contact the agency through its helpline 0803 239 3958 or send an email to recruitment@skytrendconsulting.com.

Skytrend Consulting has offices located at Ikeja and Anthony Village.

Ikeja Office
Eagles Park Building
7, Obokun Close, Off Dipeolu Street,
Off Obafemi Awolowo Way,
Behind Tantalizers, Allen Avenue Junction,
Ikeja, Lagos State.
+234 803 239 3958

Anthony Village Office
Prince of Anthony
27 Oyedele Ogunniyi Street,
Anthony Village, Lagos.
+234 803 454 9454

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

Scammers hack UBA server, cart away N752m

Skytrend Consulting Blog

Skytrend Consulting LTD

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October 17, 2019

3

Scammers hack UBA server, cart away N752m

Scammers and fraudsters have hacked and penetrated the server of a leading Nigerian bank, United Bank for Africa, UBA making away with a whopping N752 million.

This was revealed by an auditor with the bank, Mr Ojo Oladimeji, who narrates to the Federal High Court in Lagos how the bank’s server was allegedly hacked and brought down recently.

He adds that the hackers moved a total of N752million from the account of Flour Mills Nigeria Limited with the bank and transferred the sum to 20 different accounts between June 24 and July 3 this year.

The auditor was in court to testify in the case against an alleged Internet fraudster, Ola Lawal, alias Lawal Roland, who is being prosecuted for the alleged hacking of UBA’s server by the Economic and Financial Crimes Commission, (EFCC). The accused is standing trial alongside his firm, DCAN Oil and Gas Limited.

Oladimeji, who was led in evidence by EFCC lawyer, M. K. Hussain, says the fraud was narrowed down to Lawal because N46m out of the N752m was transferred into his account in Union Bank Plc.

The auditor says, “We discovered that the sum of N752m had been fraudulently transferred from one of our customers’ account, Flour Mills Nigeria Limited, to 20 different accounts, which the defendant’s company’s account was a beneficiary. Flour Mills’ account was hacked between June 24 and July 3, 2019, and the total sum of N752m was fraudulently transferred.”

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

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Recruitment Announcement for AICL

Skytrend Consulting Blog

Joy Ojumu

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October 16, 2019

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Recruitment Announcement for AICL

This is a recruitment announcement from Skytrend Consulting Ltd, an HR, accounting and business development organisation.

Our client, Avail International Consult Limited (AICL) is an international educational consultancy firm that specializes in finding the right school and course for Nigerian students & also places them into UK boarding schools, colleges and universities.

Located at Ogba, Ikeja, Lagos, AICL also assist in processing your visa and other necessary travelling documents for vacations and visitations abroad.

The organization is now in need of high flying confident, vocal and result-oriented business development staff who can get them to the next level.

If you are a graduate and you think you meet the above criteria and you are 30 years or below, then send your CV to recruitment@skytrendconsulting.com

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

N-Power: How to benefit from FG Empowerment Program

Skytrend Consulting Blog

Skytrend Consulting LTD

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October 15, 2019

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N-Power: How to benefit from FG Empowerment Program

Nigeria has been grappling with the menace of unemployment for ages. Protracted joblessness is pushing many a youths to depression and crimes making some to resort to armed robbery, kidnapping and ritualism.

According to the National Bureau of Statistics, Nigeria’s unemployment figures jumped by 30% in 2018 to over 20 million people by the end of the year. It says less than 40% of the nation’s nearly 200 million people are fully employed. Nigeria overtook India last year as having the largest number of people living in extreme poverty — 87 million — according to the Washington-based Brookings Institution. It moved out of its worst recession in almost 30 years in September 2017 and made bouts of economic growth.

However unemployment and poverty have yet to see a positive impact. Youth unemployment has been increasing because most graduates lack relevant marketable skills. The Federal government recently acknowledged that about 80% of Nigeria’s youth are unemployed while 10% are underemployed.

It’s on the basis of this that the Muhammadu Buhari led Federal Government introduced the N-Power programme on the 8th of June 2016, one year after it came into power. The program is an initiative designed to train, grant certification and provide jobs for young unemployed Nigerians for a two year period. The government says it aims to engage and train qualified young unemployed Nigerians who meet the required criteria, in order to build a new crop of skilled and highly competent workforce of technicians, artisans and service professionals.

The program is arguably the most popular social intervention and investment initiative of the President Muhammadu Buhari’s Government. Nigerians between the ages of 18-35 among other criteria are eligible to apply. The N-Power programme helps beneficiaries in acquiring relevant skills to become primary players in the domestic market and solution providers within their communities. Every month, the federal government spends about N15 billion as stipends on 500,000 volunteers of the N-Power scheme. The government avers that despite the current high level of unemployment, harnessing Nigeria’s young demography through appropriate skill development efforts provides an opportunity to achieve inclusion and productivity within the country.

In the first year of the N-Power scheme, it recorded 200,000 beneficiaries and now has 300,000 young Nigerians in paid work. No doubt it has transformed many youthful lives by better positioning them in the labour market. Large-scale skill development is the main policy thrust of the programme.

According to Stears Business blog, “N-Power strives to improve the quality of labour supply by training youths, but cannot affect the demand for labour in the economy. So, perversely, creating better-skilled workers without a corresponding increase in modest employment and thereby leaving the economy with highly skilled but unemployed youth.”

N-Power which has categories for graduates and non graduates applicants, is also linked to the Federal Government’s policies in the economic, employment and social development arena. Each participant stays on the scheme for two years before they are retired. The logic is to make way for a new crop to benefit from the scheme as opposed to keeping the same set of individuals within the system. Ideally, more people are reached, and those retired from the system are better equipped to gain meaningful (self) employment.

N-Power Graduates Category
The N-Power Graduate category also known as N-Power Volunteer Corps is a post-tertiary engagement initiative and it’s paid volunteering programme for 2-year duration. The graduates will undertake their primary tasks in identified public services within their proximate communities. All N-Power Volunteers are entitled to computing devices that will contain information necessary for their specific engagement, as well as information for their continuous training and development. N-Power volunteers provide teaching, instructional and advisory solutions in 4 key areas which include;

1. N-Power Agro. These volunteers provide advisory services to farmers across the country. They will disseminate the knowledge that has been aggregated by the Federal Ministry of Agriculture and Rural Development in the area of extension services.

2. N-Power Health: Volunteers under this scheme help improve and promote preventive healthcare in their communities to vulnerable members of the society including pregnant women and children and to families and individuals.

3. N-Power Teach: Volunteers here help improve basic education delivery in Nigeria. They are deployed as teaching assistants in primary schools around Nigeria.

4. N-Power Tax: These volunteers are selected to work as Community Tax Liaison Officers in their states of residence with the state’s tax authorities. The N-Power community tax liaison officers will have responsibilities which will include answering online inquiries, customer management, creating awareness of tax compliance.

N-Power Non-Graduate Category
The N-Power Non-Graduate category is designed to train and empower non-graduates with skills that they can use for the betterment of themselves and the economy at large. The programme offers training and certification programme for all successful candidates.

The N-Power Non-Graduate category provides training and certifications in 2 key areas which include;

N-Power Knowledge: The N-Power Knowledge programme is the Federal Government’s first step towards diversifying to a knowledge economy. This programme work alongside the planned eight innovation hubs across the country to provide incubation and acceleration of the technology and creative industries. The programme is a ‘Training to Jobs’ initiative, essentially ensuring that participants can get engaged in the marketplace in an outsourcing capacity, as freelancers, as employees, and as entrepreneurs.

N-Power Build: This is an accelerated training and certification (Skills to Job) programme that will engage and train 75,000 young unemployed Nigerians in order to build a new crop of a skilled and highly competent workforce of technicians, artisans and service professionals.

How To Apply For N-Power
To apply for the N-Power program, you will need to meet the minimum requirements (if any) for your respective programme. Generally, the selection is based on expression of a genuine interest in whichever area the applicant decides, passing the relevant tests, willingness to push oneself beyond one’s comfort zone; and the ability to show a flair to develop skills needed to make the applicant achieve his potentials.

For registration, applicants need to provide BVN No, CV, NYSC certificate and number, Passport photographs, ND and NCE degree certificate and the e-mail address on the N-Power porter.

The current n-power application form is only for undergraduates position. If you have your SSCE result, then pick it up now and apply for npower via www.portal.npower.gov.ng online.

After the online registration, you’ll be shortlisted for screening, interview, if you are successfully shortlisted, you’ll undergo n-power posting and n-power deployment.

it’s believed that over 500,000 qualified Nigerians are presently enrolled in the programme, with a steady flow of stipends without any interference. Many have built entrepreneurship, acquired skills, such that even after the expiration of their tenure in the scheme, they hopefully should be able to sustain a continuous inflow of income.

In an article published in Daily Trust in January 6, it ask, ”Does the (N-Power) scheme solve the unemployment cum poverty problem (of Nigeria)? The answer is a definite no. However, it has cushioned the effect of the two and it’s important this fact is highlighted.

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

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Goods can no longer enter Nigeria through land borders

Skytrend Consulting Blog

Skytrend Consulting LTD

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October 14, 2019

2

Goods can no longer enter Nigeria through land borders

The Nigerian Customs Service (NCS) says no item can be imported or exported through the nation’s land borders.

Hameed Ali, comptroller-general of NCS, said this at a press conference in Abuja on Monday.

He said the measure would enable security agencies to be able to scan the goods entering the country.

Ali said for now, goods can only enter the country through the air and sea ports, where they can undergo thorough scanning and certified fit for consumption.

“We hope that by the time we get to the end of this exercise, we would have agreed with our neighbours on the type of goods that should enter and exit our country,” he said.

“For now, all goods, whether illicit or non-illicit, are banned from going and coming into Nigeria.

“Let me add that for the avoidance of doubt that we included all goods because all goods can equally come through our seaports.

“For that reason, we have deemed it necessary for now that importers of such goods should go through our controlled boarders where we have scanners to verify the kind of goods and how healthy to our people can be conducted.”

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

Businesses With Less Than N25m Turnover Are Now VAT Exempt

PAYE: How to calculate personal income tax

Skytrend Consulting: Financial services and accounting solutions company

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Nigerian Central Bank Approves Disbursement Of Loans For Creative Industries At 9%

How To Empower Yourself And Generate Income From Mutual Funds

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Points To Note When Fixing Prices For Your Products, Services

Skytrend Consulting Blog

Joy Ojumu

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October 14, 2019

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Points To Note When Fixing Prices For Your Products, Services

Fixing prices is very important because it determines the contribution and profit of a firm.

There are 3 approaches to pricing:

1. Demand/ Customer based approach- This reflects customers perception of the benefits they will enjoy from purchasing the product e.g. convenience, status, etc.

2. Cost based approach- Cost here could mean actual cost, standard cost, marginal cost, relevant cost or full cost. Usually a chosen mark up or margin is added to determine selling price.

3. Competition based approach- Involves setting a price based on the prices of competing products.
Customer and competition based pricing are more likely to maximize profits since they take into account the behaviour of customers and competitors as well as the need to recover costs.

Cost based pricing in contrast simply reflects the objective of cost recovery or achieving a margin on sales and ignores the potential to exploit the level of customers’ interest in the product or the strength of the product in the market relative to competition.

Procedure for establishing the optimum price of a product include:

Step 1- Establish the linear relationship between price (P) and quantity demanded (Q). The equation will take the form: P = a – bQ, Where
a = intercept i.e. the maximum theoretical price at which demand will fall to zero.
b = the gradient of the line i.e. the amount the price has to change to change the demand by one unit.

Step 2- Double the gradient to find the marginal revenue MR= a – 2bQ

Step 3- Establish the marginal cost MC. This is normally the variable cost per unit.

Step 4- To maximize profit equate MC and MR and solve to find Q.

Step 5- Substitute this value of Q into the price equation to find the optimum price.

Step 6- It may be necessary to calculate maximum profit.

Equation for the Total Cost function-

This can be derived using the high /low method and then predictions can be made from the equation derived.

Price Elasticity of Demand
This is the measure of how responsive demand is to a change in price.
PED = % change in demand / % change in price.

Pricing Strategies

Market Skimming- Involves charging high prices when a product is first launched in order to maximize short term profit. Once the market becomes saturated the price can be reduced to attract other parts of the market which remain unexploited.

Penetration Pricing-
Involves charging low prices when a new product is initially launched in order to gain rapid acceptance. Once market share is achieved, prices are increased. It is an alternative to market skimming.

Complimentary Pricing- This strategy is normally used with 2 products e.g. razors and razor blade. If sales of razor increase, more razor blades will be bought.

Product line Pricing- A product line is a range of products that are related to one another.

Product line pricing occurs when setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features and competitor pricing.

Volume Discounting- This is used to increase customer loyalty or attract new customers. It involves offering customers a lower price per unit if they purchase a particular quantity of product.

Price Discrimination- This occurs when a company sells the same product at different prices in different markets for reasons not associated with costs.

Customers may be segregated into different markets and the seller must have some degree of monopoly power. The danger however is that a black market may develop or competitors may join the market and undercut the firm.

Cost Plus Pricing- When using this method, a firm may use Actual cost, Standard cost, Marginal cost or Full cost in addition to a chosen mark up or margin.

Call 0803 239 3958 for free financial consulting advice for your businesses.
Send your accounting articles to blog@skytrendconsulting.com.

4 Simple Ways To Calculating Depreciation

Skytrend Consulting Blog

Joy Ojumu

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October 14, 2019

0

4 Simple Ways To Calculating Depreciation

Depreciation represents how much of an asset’s value has been used up.

Depreciating assets helps companies earn revenue from an asset while expensing a portion of its cost each year the asset is in use.

An Example – If a delivery van is purchased by a company with a cost of #200,000 and the expected usage of the van is 5 years, the business might depreciate the asset under depreciation expense as #40,000 every year for a period of 5 years.

Methods Of Depreciation

1. Straight-Line Method: This is the simplest method of all. It involves simple allocation of an even rate of depreciation every year over the useful life of the asset.

The formula for straight line depreciation is:

Annual Depreciation expense = (Asset cost – Residual Value) / Useful life of the asset

2. Sum-of-the-Years-Digits Method
Some businesses, though, prefer an accelerated depreciation method that means paying higher expenses early on and diminishes over time.

This may be to their advantage in tax season as they would have a low net income in the first year but make up their loss in taxes later on.

The formula for the sum-of-the-years-digits method:
Depreciation Expense = (Remaining life / Sum of the years digits) x (Cost – Salvage value)

3. Double Declining Method

Compared to other depreciation methods, double-declining-balance depreciation results in a larger amount expensed in the earlier years as opposed to the later years of an asset’s useful life. The method states the fact that assets are typically more productive in their early years than in their later years.

The formular for double-declining balance method:
Periodic Depreciation Expense = Beginning book value x Rate of depreciation

4. Units of Production

This method requires an estimate for the total units an asset will produce over its useful life. Depreciation expense is then calculated per year based on the number of units produced. This method also calculates depreciation expenses based on the depreciable amount.

This is a two-step process, unlike straight line method. Here, equal expense rates are assigned to each unit produced. This assignment makes the method very useful in assembly for production lines.

The formular for Units of Production:

Annual Depreciation=Depreciable Value×Units produced during the yearEstimated total production
Depreciable Value = Original cost – Scrap value

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