In a bid to provide financial management support, Rwanda Revenue Authority (RRA) signed a Memorandum of Understanding worth $18,500 to support Small and Medium Enterprises (SMEs) prepare their annual financial statements.
The MOU was signed on Wednesday at RRA headquarters in Kimihurura, between RRA and Private Sector Federation (PSF).
According to a press statement, the funds will support SMEs in preparing their annual financial statements through the Business Development Service (BDS) Networks’ resident accountants using tailor-made software. They will also be trained on how to utilize accounting software.
The fund comes after realizing that less than 10 percent of the SMEs in Rwanda prepare annual financial statements and most of them do not know whether they make a profit or loss at the end of their financial year.
This hinders their filing of tax returns to RRA and thereby affecting the exactness of forecasting annual revenues from tax returns.
“The MOU therefore comes to strengthen the capacity of resident accountants which will in return promote SMEs and hence boost the economic growth,” a statement reads.
The move will also address the scarcity of professional accountants in Rwanda and the high cost associated with employing professional accountants by SMEs.
The private Sector is expected to recruit resident accountants to serve in each BDS Center through a competitive process and train them on tax verification methods and techniques, a statement reads in part.
Private Sector will organize the resident accountants training workshop, identify a firm to provide the financial management software, provide office space to the resident accountant in each BDS Center, manage and monitor the entire network of Resident accountants.
It will also provide awareness and publicity to the resident accountant network with a view encouraging the business community to utilize the services of the resident accountant.