Mr. Jasseh Conteh,
Thanks for the detail explaination and elaboration. It is indeed very
informative and adds to my frame of reference.
It is definitely a relevant issue in a field which I am deeply interested
regarding the GAMBIA.
Again, thanks for educating me. As always, good luck to you.
BEST REGARDS,
Ablie Njie-Lekbi
Atlanta
>From: Jassey Conteh <[log in to unmask]>
>Reply-To: Jassey Conteh <[log in to unmask]>
>To: [log in to unmask]
>Subject: Re: The Gambian Dalasi-LEKBI
>Date: Tue, 3 Feb 2004 11:23:14 -0800
>
>Comrades:
>
>The functional currency is the domestic currency relative to international
>financial transactions, particularly when these goods and services are
>produced and marketed in the domestic market. It is the hope that entities
>in the Gambia are engaged in business to sell their goods and services to
>their respecitive customers. It also the hope that these entities
>formulate strategic costs incurred that do not exceed benefits derived from
>their money measure approaches. These entities should record their sale
>prices denominated in the Gambian Dalasi.
>
>It is thus practical and economically sound that entities in the Gambia
>follow the realization principle of pricing their goods and services
>denominated in the Gambian Dalasi. One patriotic duty is that it
>illustrates confidence in the Gambian Dalasi.
>
>Analyzation principle, which consists of both financial and nonfinancial
>data entails, for example, market surveys. These surveys may affirm
>customer tastes and preferences. If one successfully pinpoints customers
>tastes and
>preferences; direct materials or services, direct labor and
>manufacturing/service overhead allocated are valued as production costs.
>My question is, did the entities in the Gambia pay their Gambian workers in
>foreign currencies? No! These costs were paid in the Gambian Dalasi, even
>if raw materials were purchased internationally. A case in point is that a
>pro forma statement is prepared by a bank prior to a purchase of foreign
>goods, and that the purchaser pays invoice prices directly to a Gambian
>bank. It is categorically true that these entities are not directly paying
>the foreign seller. It is also true that Gambian banks denominanate the
>Gambian Dalasi as the money measure amount owed to a foreign seller.
>
>When total manufacturing or service costs are valued, the notion is that
>the entity hopes to make a profit. In this regard, realization principle
>takes form when a sale or purchase is made. Realization principle is
>defined as the point of sale or purchase, from which a transaction is first
>recorded in the book of original entry called the general journal. Are
>entities in the Gambia recording their transactions in foreign currencies?
>I hope not! If this is true, then the Dalasi will continue to devalue at a
>significant rate.
>
>Even if an entity that is located in the Gambia is a subsidiary of a parent
>headquartered in a foreign country, asset = liabilities + owners' equity
>should be measured in the Gambian Dalasi; thus affirming that at point of
>sale these transactions should be recorded at historical value. This
>affirms the notion that assets recorded at historical
>values assert that inflation is temporary and that changes in prices are
>minimal. But if the entity chooses to ignore its funcitional currency, its
>is directly affirming its lack of confidence in its own domestic currency.
>
>Foreign currency adjustments in the form of comprehensive income will not
>be necessitated by an entity such as
>Taff. The principle is further affirmed that the only entity making
>foreign currency translation adjustments should be the Central Bank of the
>Gambia. A subsidiary entity located in the Gambia plays no active role in
>the determination of asset = liabilities + owners' equity on a
>consolidated basis. Do we even have such entities? No. Why? Because
>policies enacted or lack of sound fiscal policies are cultivating negative
>trends in the viability of the Gambian's economic output. This policy
>should be above politics because it directly affects every Gambian.
>
>A note of caution is that since we have numerous merchandises and hotel
>industries in the Gambia, why should a price at point of sale be
>denominated in the U.S. Dollar and the British Pound Sterling? Does this
>signal that these entities have no trust in the Gambian Dalasi? Why should
>one pay Taff Real Estate foreign currencies at realization point of
>obtaining property? Does Taff have authority directly selling foreign
>currencies to respective foreign governments? Is Taff Real Estate now the
>Central Bank of the Gambia?
>
>Are other Gambian entities also directly selling those foreign currencies
>with respective foreign governments? I state emphatically that this is
>totally impossible. Are these entities mediating as the Central Bank of
>The Gambia? No. If this is in the affirmative, then we have a fiscal
>crisis in the Gambia. Are these entities deposing their daily transactions
>denominated in the Gambian Dalasi with commercial banks in the Gambia? I
>concur affirmatively.
>
>A case in point is that the Gambia Central Bank is the intermediary of
>foreign currency sales between affected foreign governments. Is this not
>of sound fiscal policy that our house be in order. This in my
>interpretation should be above politics. I practically and sincerely
>affirm constructive engagement. The APRC government should change course
>and listen to its critics. We all have stakes in the Gambia, and thus it
>is prudent that the realization principle not be violated by these entities
>and the Gambian government.
>
>Naphiyo,
>Muhammad Lamine J. Conteh
>
>
>-----Original Message-----
>From: Abdoul Njie <[log in to unmask]>
>Sent: Feb 3, 2004 11:52 AM
>To: [log in to unmask]
>Subject: Re: The Gambian Dalasi-LEKBI
>
>Mr. Jasseh,
>
>At your convenience, for those of us who are not savy in the fields of
>accounting and financing, could you kindly elaborate on the realization
>principle( Revenue Recogniton Principle) and the effect such practices
>have
>on the devaluation of the Gambian Dalasi?
>
>
>Welcome back and hope you had a wonderful time.
>
>
>As always to You- BEST REGARDS,
>
>
>Ablie Njie- Lekbi
>
>
>
>
>
>
>Best Regards,
>
>
>Ablie Njie0- Lekbi
>
>
>
>
>
> >From: Jassey Conteh <[log in to unmask]>
> >Reply-To: Jassey Conteh <[log in to unmask]>
> >To: [log in to unmask]
> >Subject: The Gambian Dalasi
> >Date: Tue, 3 Feb 2004 10:12:29 -0500
> >
> >Comrades:
> >
> >I was just checking around and noticed that hotels, taff's real estate
>and
> >other
> >entities in the Gambia are denominating their respective sales prices in
> >the U.S.
> >and the British Pound Sterling. This should be stopped by the Ministry
>of
> >Finance
> >because it has contributed to the devaluation of the Gambian Dalais.
> >
> >Since these entities are located in the Gambia, both the revenue and
> >expenditure
> >measurements state that the domestic currency should be the functional
> >currency
> >for the realization principle. I hope the Ministry of Finance takes a
> >serious look
> >at the lack of confidence that these entities are contributing to the
> >economic stability of
> >the Gambia.
> >
> >Naphiyo,
> >Comrade M. Lamine J. Conteh
> >
> >~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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