CFO Timothy Thaiting'a extols the virtues of a flat structure

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"CFOs thrive when they are placed in a flat rather than a purely hierarchical structure." This is according to Africa Legal Network (ALN) CFO Timothy Thaiting’a.

"CFOs thrive when they are placed in a flat rather than a purely hierarchical structure." This is according to Africa Legal Network (ALN) CFO Timothy Thaiting’a.

"It is such a pleasure for me to work in a place where I can be able to walk into the managing partner’s office and discuss a matter," he explains.

Timothy is responsible for finance for a number of businesses and across different geographies. These include Anjarwalla and Khana law firms in Kenya, Tanzania and in the Gulf and Adili Group in Kenya, Uganda and Tanzania.

"Adili is our alternative services platform, handling such services as outsourced accounting, company secretarial, cybersecurity and whistleblowing among others," he explains.

Timothy graduated with mathematics and computer science honours from Jomo Kenyatta University of Agriculture and Technology in 2005 and joined PwC a year later.

He was initially a coordinator in the office service’s function housed within the business support services, a position he held until February 2008. The firm saw his potential to achieve even greater things and he was asked to choose between IT, finance and forensics.

"While I was battling with the decision, my coach and then head of finance Matata Munyeke took me out to lunch and advised me to pursue a career in finance because he had spotted my ability with numbers. I saw an opportunity to utilise my computer knowledge and mix it with numbers in a business environment. It is a decision that I have never regretted. I soon after enrolled for the CPA course, qualifying as a CPA(K) in 2011," he says.

Intentional mentorship

As part of his integration into the firm’s business, he was deployed to different roles within the finance department in Kenya as well as a short-term secondment to Zambia. Timothy was appointed in 2017 to be the procure-to pay workstream lead for PwC Africa during the implementation of Oracle cloud solution across 17 countries.

He served for three years as deputy CFO of the Kenya practice before ALN came calling. He took up the CFO role at the legal services group in September 2019.

Timothy has become somewhat of an expert in leading finance teams at professional services firms. Intentional mentorship is a critical success factor within the finance world, and he attributes this to tutorage under the then PwC Kenya CFO, Joseph Nzou.

Professional services firms are a different prospect to a "normal company" where the shareholders, the board and management are usually different people. The firms are largely owner-managed and hence a finance leader would be reporting directly to owners of the business. This may sometimes lengthen the time taken to get approvals because the owners have to be convinced unlike in a private company where fewer decisions require shareholder approval.

Integrated firms that are part of an international network have an additional complexity. A number of strategic decisions are made in places such as Johannesburg, New York or London and cascaded down to other offices. This would include decisions around what ERP system to adopt or even reporting templates and methodologies. The centralised decision-making is necessary because rendering audit services has significant risks and strict independence requirements.

Acting as a strategic advisor

"Here [at ALN}, the partnership can make its own decisions and they have also implemented the kind of corporate governance structures you would find in a private company," Timothy says.

"The firm has co-managing partners Daniel Ngumy and Rosa Nduati-Mutero who are in charge of the implementation of the finance strategy, and I therefore report to them directly as well as having some dotted lines to the various leadership organs of the firm. There is also a partnership board and management team in place," Timothy adds.

The partners have delegated many decisions to the management team which makes the team a strategic advisor to the business rather than just an implementor.

"I am really enjoying being part of the strategic conversations," Timothy says. "COVID-19 struck soon after I joined the firm and we needed to upgrade our system in a way that would allow our fee-earners to remotely record time, the finance team to invoice clients and collect payments while working from home. I led the implementation of the system upgrade, greatly assisted by the firm’s IT team and that was a crucial step in making the business resilient during the pandemic," he explains.

While Timothy acknowledges there is still room for improvement, the digital efficiency is something that some stakeholders in the business never imagined was possible.

The quadrants of the CFO role
The CFO role at ALN is divided into four quadrants. First, strategic finance where Timothy is responsible for crafting a finance strategy that is aligned to the firm’s broader strategy.

Secondly, operational finance, where he handles such matters as the maintenance of the general ledger. Reporting is the third quadrant which relates to extracting, organising and providing financial data to the firm for decision-making purposes.

"The last quadrant is that of control and risk where I interact with external regulators and policy makers. A key matter in this regard is tax compliance which has become even more complex across various jurisdictions," Timothy explains.

Other pressing matters for Timothy include working capital management. A law firm is a "self-liquidating" business where profits are made and must be distributed within a reasonably short period without the luxury of retained earnings. The CFO therefore needs to ensure that there is sufficient lag phase between paying out distributions and generating cash flows.

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