A Study of the African Union Finances and Budgeting Practices

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Abstract

The survival of any organization, regardless of whether it is large or small, national or international, depends on the flexibility and effective administration of its fiscal matters. The advancement of information technology and the proliferation of academic research in the last few decades ushered in the much-needed know-how and expertise in terms of monetary investments. The African Union (AU), founded in 2002, evolved out of the former Organization of African Unity (OAU) that was founded in 1963 in Addis Ababa, Ethiopia by a group of African leaders under the auspices of former Emperor Haile Selassie (Udombana, 2002). The AU evolved out of two groups of African nations: the Casablanca Group and the Monrovia Group (Genge, Kornegay, and Rule, 2000). Organizations that have strong economic foundations tend to survive longer than those managed with scarce resources. Surprisingly, the AU, that is almost foreign aid dependent, has been able to survive for a long period. In the last few decades, despite existence of various political, social, and economic upheavals, the AU has remained an exemplary force due to its ability to stay on course and remain part of the international community. The purpose of this paper is to uncover the fiscal administrative strictures that make the AU effective and is divided into various sections, each delving into an issue of particular interest to fiscal public sector.

Mission and goals of the organization

In its initial conception, the Union was founded on the principles of uniting the nations that constitute the massive African continent and was modeled from the EU (Steinberg, 2001). It was established on the notion of partaking in the elimination of apartheid and colonialism in the continent. The mission and goals of the AU include valuing diversity and respect for joint effort, putting the interests of Africa above everything, observing transparency and accountability, uprightness and fairness, efficiency and expertise, and propagation of information and knowledge. The AU is on the forefront of reducing conflicts in afflicted parts of the continent through the creation of contingents of multidisciplinary rapid deployment forces. It is strengthening to overcome humanitarian disasters and as well struggling to integrate into the international community of nations.

Ethical Considerations in Finance and Budgeting

There exist ethical considerations in the finance and budgeting systems of the AU. The AU spends large sums of money for the protection of civilians in war prone regions of the continent yet little is done to deter belligerent parties from causing harm to innocent unarmed civilians and their properties. Despite receiving considerable financial resources for its peacekeeping operations in southern Sudan, the AU has been unable to keep at bay antagonistic forces taking the lives of poor southern Sudanese citizens and the repressive Janjaweed militia that wrecked havoc in Darfur. The AU des not have the might and financial capabilities that can allow it to transcend borders and pursue enemies at long distances (Williams. 2006). Despite article 4(h) of the AU charter stipulating the use of force when incidents like genocide and crimes against humanity occur, in essence, the Union has been unable to meet its commitments in reclaiming peace in various parts of the continent such as in Somalia and Rwanda (Williams, 2006). The Union is beset by unprofessionalism and abuse of office by management and employees hailing from distinct backgrounds. Lack of qualified personnel, poor communication and linguistic barriers are some of the elements of concern that place a barrier in the creation of a strong, effective workforce (Ping, 2009).

Technological considerations

Modern technological innovations improve efficiency within organizations and if effectively used in the finance and budgeting sector, can bring significant improvements and garner support from shareholders and stakeholders as well. The AU has a lot to achieve from technological use. In the last few years, the AU has seen significant improvements especially with the establishment of an African parliament, a banking institution, and regional economies. There have been drastic improvements in the fields of technology within the AU since the start of the Arab Spring in 2011 (ACSS, 2011). Demand for dignity and political inclusion among the youth imitating the political changes visible in North Africa has never been so captivating. As elucidated by Franklin and Raadschelders (2004), favoring one determinant over another, may result in dilemmas for decision-makers. The use of technology has been skyrocketing for the AU primarily as a result of the effects of globalization, human interconnectedness, and global integration. Globalization evolved out of the modernization of the 1950s and 1960s and there is much talk about market and capital proliferation among nations that share common interests and cultural elements that make communication possible (Cooper, 2001).

Applicable laws, regulations, and policies

The Union is mainly guided by seventeen institutions that are responsible for its effective operations and financial stability. The African Heads of State and Government (AHSG) is drawn from the fifty-three leaders of the Union; others are the Executive Council (EC), the Permanent Representative Committee (PRC) that act like ambassadors of their respective nations, a legislative assembly known as the Pan-African Parliament, a judicial court, and three banking institutions (Tieku, 2004). Fear of state draconian laws continues to drive thousands if not millions of educated African intellectuals and professionals out of the continent that ultimately lead to brain drain and thereafter placing a strain on important social services. Authoritarian rule still captures the continent’s political spectrum with almost 40% of African nations still reeling under dictatorial repression consequently triggering unemployment, underdevelopment, and social decline (ACSS, 2011).

The stability of the African business enterprise is held aback by government bureaucracy and denied competition by a penumbra of stiff governmental legislations, that include lack of empowerment and limitations on foreign investments. Among the applicable laws and legal policies that bind the AU to other nations in the fields of trade and industry is the ACP-EU Cotonou agreement that opened the doors for better bilateral agreements (Udombana, 2004). Despite its explosive population growth that exceeds 700 million, the African continent accounts for only 1% of the world’s GDP and a mere 2% of international trade. What holds African products back and not fare well in the international markets, are the stringent measures that include imposition of hefty tariffs by industrialized nations in the European rim and North America. These nations feel African products to be of inferior qualities and having health hazards. However, according to Corkin & Burke (2006), the People’s Republic of China is filling the vacuum where Western powers have failed. China is playing a great role in assisting African nations in infrastructural developments. China is helping African nations so as to extract for itself the vast natural resources that remain untapped in the African continent. Communist China is engaged in Angola for oil; it is heavily engaged in Tanzania, Malawi, Sierra Leone, and Zambia.

Evaluation of budget process and revenue sources

One simple budget process that can be of vital importance to the AU’s financial operating procedures would be the use of the operating budget plan. This is a system that allows organizations to be able to summarize annually allotted monetary resources and succinctly be able to accelerate smooth operations of their existing valuable resources without losing tack. Udombana (2004) perceives that there exist challenging business relations between the AU and nations in the Caribbean rim, the EU, and North America. European Aid to the AU for the fiscal year 2008 was estimated at $28,656,819 (EuropeAid, 2008). The AU’S use of the Government Finance Officers Association (GFOA) budgeting system which is a specific budgetary system applicable to public finance could be of valuable use as it is a three-fold comprehensive budgeting operating procedure that can be easily applied when financial officers have the vital tools and expertise necessary for maintaining a mammoth organization like the AU.

Impact of internal factors

The Union has multiple internal factors that could impede its strategic planning and these include economic disparities, gender imbalances, pandemics, internal strife in states within the Union, drought, locust invasions, and a plethora of problems that evolve without warnings. Unlike the EU, the AU evolved as a result of colonialism and that nations that constitute it are regarded as multi-states and not nation-states as in the case of the EU (Steinberg, 2001). Money mismanagement at times evolve as fractions of a budget have to be sent to other regions that need immediate attention to overcome major challenges like unanticipated catastrophes and other natural disasters having destabilizing effects. Besides existence of antagonism that exists within the Union leadership, foreign hands at times meddle with the effective administration of the Union’s fiscal matters. Political instability and internal strife have had adverse effects on the economies of many states ruled by dictators. Besides the Arab Spring uprising that gripped the northern part of the continent, violent demonstrations have been seen in Djibouti, Cote d’Ivoire, Swaziland, Guinea Bissau, Mauritania, Gabon, Cameroon, Benin, Malawi, Senegal, Uganda, and Kenya respectively (ACSS, 2011). Only seven African countries fall under the category known as ‘consolidating democracies’; twenty are perceived as ‘democratizers’; eleven are ‘semi-authoritarians’; while another eleven are absolute ‘autocracies’ (ACSS, 2011). Political instability, poverty, repressive regulations, disease, human rights violations, and impermanence of nationhood are some indicators that lead to economic stagnation of the AU. The breakup of the former OAU came as a result of the improper handling of the African Economic Community (AEC), which, according to Tieku (2011), had all the hallmarks of functional and structural flaws. Despite changes in governance, the AU remains in economic limbo.

Use of cost-benefit analysis

The AU is a massive organization that has a working structure alike that of the EU and the UN. According to Mikesell (2011), separation of budgets is necessary if efficiency and financial elegance is to be experienced in business transactions. The presence of corruption has had adverse effects on the AU’s application of cost-benefit analysis. Corruption is an endemic factor that is visible in almost every country and that it is an immoral act that benefits the office-bearer or politician Nye (1967). Corruption in African states is so widespread that it is synonymous with weed decimating a healthy plant. Problems do exist in the management of the environment in many African countries whose tourism industries remain in infancy. The spread of various diseases that kill humans and animals alike continue to be of concern for many African countries whose medical and veterinary facilities are no match for the yearly spread of contagious diseases that cripple vast populations. However, working in concert with various international organizations, many African states have been able to emerge successful in combating diseases having catastrophic consequences though a lot needs to be done by these nations to achieve self-sufficiency in the medical field.

Cash management and investment strategies

The biggest investment institution for the AU is the African Development Bank (ADB) whose current temporary head office is in the city of Tunis, in Tunisia. It was relocated from its former base of Abidjan due to insecurity in the West African nation of Cote d’Ivoire. An African multilateral banking system that exists to be of service to the entire nations that constitutes the broader AU, ADB was established to eradicate poverty and improve the livelihoods of Africans in general (AfDevInfo, 2011). Founded in 1964, ADB has fifty-three shareholders that are primarily member states of the AU and twenty-four foreign entities coming from countries in Asia, Europe, and America.

Assessment of overall financial condition

Assessment and auditing of the AU finances is the prerogative of qualified AU auditors and financial experts who work in concert with foreign-based donor employees tasked with keeping an eye on effective use of foreign aid. The AU relies on foreign economic powers to finance its operations. The EU, some Middle Eastern countries, China, and the U.S. are by far the largest donors of the AU in terms of military infrastructure earmarked for peacekeeping operations, fight against pandemics, containment of HIV/AIDS, deforestation, control of malaria; infrastructures such as hydro-electric power generation, construction of medical facilities, educational institutions, and student scholarships. The AU budget for the fiscal year 2011 was estimated at $256,754,447 mostly from donors and a few generous entities residing in the continent (EuropeAid, 2008). The AU’s expenditure is mainly spent on its own operation and that it is a non-profit organization that lacks investment of its own with the exception of the African Development Bank (ADB) that serves as the only financial institution shared among member states. Without assistance from foreign donors, the AU may not be able to survive on its own. Nations within the Union have a funds collection system where every nation has to pay a certain amount of money for the upkeep of the Union official operations. However, some states tend to be delinquent in their remunerations.

References

AfDevInfo (2011). African Development Bank Group. Retrieved from http://www.afdevinfo.com/htmlreports/org/org_26876.html

ACSS Special Report No. 1 (November 2011). Africa and the Arab Spring: A New era of democratic expectations. Retrieved from http://africacenter.org/wp-content/uploads/2011/11/ACSS-Special-Report-1.pdf

Cooper, F. (2001). What is the concept of globalization good for? An African historian’s perspective. African Affairs (2001), 100, 189–213

Corkin, L. & Burke, C. (2006). China’s Interest and Activity in Africa’s Construction and
Infrastructure Sectors. Centre for Chinese Studies, University of Stellenbosch. Retrieved from
http://www.ccs.org.za/downloads/DFID%20Exec%20Summary.pdf

EuropeAid (2008). Financial contributions of EuropeAid to African Union 2000-2008. Retrieved from http://ec.europa.eu/europeaid/who/partners/international-organisations/documents/au_2008_fr.pdf

Franklin, A. L., & Raadschelders, J. C. (2004). Ethics in local government budgeting: Is there a gap between theory and practice? Public Administration Quarterly, 27(4), 456–490.

Genge, M., Kornegay, F., and Rule, S. (2000). African Union and Pan-African Parliament: Working Papers. Retrieved from http://unpan1.un.org/intradoc/groups/public/documents/idep/unpan003885.pdf

Mikesell, J. L. (2011). Fiscal administration: Analysis and applications for the public sector (8th ed.). Boston, MA: Wadsworth.

Nye, J. (1967). Corruption and political development: A cost-benefit analysis. American Political Science Review. Vol. 61, No. 2.

Ping, J. (2009). Strategic Plan 2009-2012. Directorate for strategic planning policy, monitoring, evaluation, and resource mobilization. Retrieved from http://au.int/en/sites/default/files/Strategic_Plan2009-2012.pdf

Steinberg, N. (2001). Background paper on African Union. World Federalist Movement. Retrieved from http://www.wfm-igp.org/site/files/AU_background_doc.pdf

Tieku, T. (2004). Explaining the clash and accommodation of interests of major actors in the creation of the African Union. African Affairs (2004), 103, 249–267, DOI: 10.1093/afraf/adh041

Udombana, N. (2002). Can the leopard change its spots? The African Union treaty and human rights. American University International Law Review, Vol. 17 Issue 6.

Udombana, N. (2004). Back to Basics: The ACP-EU Cotonou Trade Agreement and Challenges for the African Union. Texas International Law Journal 40. 1 (Fall 2004): 59-111.

Williams, S. (2006). Military responses to mass killing: The African Union mission in Sudan. International Peacekeeping (13533312).

Effective Use of Strategic Planning

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Strategic planning is useful as it helps uncover problems associated with organizational management. Organizations that have strategic planning processes or long-range planning in place have the best chance of surviving longer and staying healthier as they have the tendency to understand huddles that evolve now and then. Having effective strategic planning is like having complete navigational aids to guide in rough, turbulent waters. According to Frances (1994), it is best for agencies to undertake strategic planning when experiencing economic prosperity, when closely working with the private sector, in early gubernatorial administrations, and when increase in strategic planning is visible among competing agencies. According to the Special Libraries Association (2001), having a strategic plan for a chapter or division entails the presence of mechanisms that are uncomplicated, on paper, comprehensible, based on prevailing conditions, and that it has to be well-planned. A strategic plan has to have a mission statement, an objective, goals, and an action plan.

A strategic plan is a long-term plan that is calculated to cover an extended period ranging from five to ten years. Failing to have a strategic plan for an organization means that it will never have one. Leaders that fail to institute a strategic plan have no need of knowing what is to be expected in the future and that any impending danger will strike without notice and have devastating effects. Preparing for a strategic planning requires posing questions and laying down a framework. Having dynamic technological innovations help lay down solid foundations that will act as barriers for organizations that looked to the future.

References

Berry, F. (1994). Innovation in public management: The adoption of strategic planning.
Public Administration Review; Jul/Aug 1994; 54, 4; ABI/INFORM Global, pg. 322

Special Libraries Association (2001).Strategic planning handbook. Retrieved from
http://www.sla.org/pdfs/sphand.pdf

Capital Investments: Pay-offs and Risks

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Every organization, big or small, national or international, is prone to failures and may at times run bankrupt and shut down completely, or stagger for a while and make a complete come back to shine in the limelight again. Making organizations effective and flourishing depends on the type of leadership and approaches, and the manner of direction, guidance, and interaction among leadership, employees, stakeholders, and shareholders. According to Bryson (2004), Institutionalization of strategies can lead to people’s attention drifting else where. This is possible as humans have the tendency to change perspectives and visions regarding the present and the future. People see things differently and it is thus necessary to have focus on every aspect of project implementations. Just because a strategy has been put in place does not mean that things can’t turn around and cause a quagmire. Constant supervision of strategies in place and creating changes where applicable should be the best solution to staying on the right direction.

The African Union, the biggest decision maker of the African continent has various issues that need constant attention. For example, the subject of human rights, gender equality, and women empowerment need to be strengthened through communication, education, and inflexible mandates. Since Strategy Change is never conclusive once all plans are in place, creating an ongoing strategic management process helps alleviate unavoidable incidents. Constant evaluation and monitoring of existing networks could be helpful in unearthing and streamlining loopholes that emerge in the long run.

Having sufficient resources to cover policy implementations could be an added advantage in the case of human rights, gender imbalances, and women empowerment. Since the African Union is mainly dependent on economic powers for its upkeep, effective use of donated funds should be a priority by creating a healthy structure of accountability.
Misappropriation of funds by officials and petty theft can be dangerous if not contained at all cost.

The continent has been prone to civil and political conflicts for generations and there are no parameters in place to ensure nations live in peace and harmony. There must be expectations in every endeavor and desired outcomes must be cherished and protected at all times. Excessive red tape and bureaucracy that is holding back progress of vital sectors will have to be tackled and rules and regulations initiated so as to place a lid over embarrassing altercations among the top echelons and other office-bearers found to be absconding justice.

References

Bryson, J.M. (2004). Strategic Planning for Public and Nonprofit Organizations, 3rd Ed. San Francisco, CA: Jossey-Bass.

African Union Financial Strategies

Africa, my dream. (Photo credit: MadalenaPestana)

The New Partnership for Africa’s Development (NEPAD), founded in 2001 to ensure economic cooperation among African countries, has the potential to succeed if existing financial strategies are put into effective use and observed by all member states. In its initial conception, NEPAD was founded to overcome the poor economic conditions that was visible in Africa and also achieve the overall 7% annual target growth rate expected for attaining the Millennium Development Goals (MDG) by 2015 (de Waal, ). There is skepticism among economists as to whether every country in Africa can meet the MDG expectations. However, few countries in the continent have been able to push their economies forward and meet MDG anticipation.

NEPAD has a better chance of experiencing successful growth by partnering with G8 nations and the OECD states. The African continent has plenty of unexploited resources that include petroleum reserves and immeasurable mineral wealth. The continent’s vast tropical coastlines can be used to boost the idle tourism industries of many African states. In some African states, maintaining security is crucial before undertaking any viable socioeconomic projects. Increased human integration, financial responsibility, and effective communication are opening various corridors and bringing many isolated parts of Africa into the global limelight. Overseas-based Multinational Corporations (MNCs) may be credited for the promotion of human development and the creation of jobs in stable African democracies.

According to O’Neill (2004), there are many linkages in economic integration and it includes geographical regions. In the last few centuries, African states have been experiencing inter-regional commerce, international trade and investment. Since Africans are now getting better educated and that many professionals have connections with the outside world, there is hope for the continent to experience increased growth and investment. Some limitations to the financial strength of NEPAD include retarded technology, protracted insecurity, poor governance, lack of enhanced communication, and corruption. However, the continent is experiencing improvements in internet technology, marketing products to international level, and partaking in the global market business.

References

De Waal, A. (2002). What’s new in the ‘New Partnership for Africa’s Development’? International affairs 78, 3 (2002) 463-75.

O'Neill, T. (2004). Globalization: Fads, fictions and facts. Business Economics, 39(1), 16–27

Global Financial Synchronization

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In the last few decades, with the ushering in of globalization, the world woke up to the marvelous transformation of its financial administration and effectuation of information and informatics. At the end of the World War II, nations observed restrictions on cross-border trade (Stulz, 2005). Easing financial restrictions and opening trade barriers led to what we know today as ‘financial globalization’. In almost every continent, organizations became accustomed to a unique system of financial synchronization that eased how business is conducted. On the other hand, new organizations that took pleasure at helping other organizations ease their financial problems sprouted in financial stable nations of North America and Europe consequently leading to the opening branches in far away lands. Building of institutions, enhanced market discipline and deepening financial sector hastened human interconnectedness, business trust, and business risk taking. It has now become an acceptable standard procedure in academia and polity circles that financial globalization can be applied globally to benefit any country.

In some parts of the world, especially in economically advanced nations, instances of ‘globalization backlash’ may be experienced as a result of inequitable distribution of wealth as was seen during the WTO meeting in Seattle in 1999. Sbordone (2007), argues that trade integration, bolstered by policy incentives, is what triggers competition. Corporate governance, defined as the legal, institutional, and cultural mechanisms that help owners and stakeholders have control over the activities of insiders and management has been, according to Oxelheim and Trond (2001), beneficial since the rise of globalization. Despite the efficiency and change in global business trends, risk factors will be there to stay. In modern times, firms can either opt for the Anglo-American system, the Japanese system, the German system, or the Latin system to enhance corporate governance (Oxelheim and Trond, 2001).

References

Stulz, R. (2005). Presidential address: The limits of financial globalization. The journal of finance, Vol. LX, No. 4.

Sbordone, A.M. (2007). Globalization and inflation dynamics: The impact of increased competition. National Bureau of economic research. Working paper 13556.

Oxelheim, L. and Trond, R. (2001).The impact of foreign board membership on firm value. IUI, the Research Institute of Industrial Economics. Working Paper No. 567.

The African Union

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Abstract

The survival of any organization depends on the nature, approaches, and competence of its leadership and the effective application of the various strategic planning processes at play. In modern times, academics have been strenuously writing research papers that have been of profound importance to many struggling organizations within and outside of the United States. The process of globalization and human interaction and human interconnectedness may be attributed to the drastic rise in the development of organizations witnessed sprouting in almost every corner of the world. One such international organization is the African Union (AU) that evolved with the first struggles for independence that was spearheaded by African leaders who were determined to create political, social, and economic stability for their nations that constitute the Union and for the entire continental population. Established as an organization meant to fight apartheid and colonialism, the AU has in the last few decades, transformed into an international organization enjoying respect in the international community. The purpose of this research paper is to discuss the strategic planning processes of the AU and the many factors that make its operations achievable or unattainable.

The African Union

The African Union (AU) is the largest single entity representing the social, cultural, political, and economic aspects of the African continent and is an amalgamation of fifty-three sovereign states enjoying various political, social, and economic indicators. The only country that is not part of the AU is the North African kingdom of Morocco that left the Union in 1982 after majority of African states recognized the Sahrawi Republic. According to Touval (1967), Morocco’s resentment of the OAU governing systems started in 1963 when King Hassan absented himself from the plenary session in protest of Mauritania’s participation. OAU had until 2002 when it changed named name to AU, not resolved the long simmering disputes between Morocco and Algeria; Somalia and Ethiopia; Somalia and Kenya; and Ghana and Upper Volta (currently Burkina Faso) (Touval, 1967).

Despite being blessed with natural resources and manpower, the continent lags behind the rest of the world socially, politically, and economically and is much dependent on foreign aid provided by powerful Western governments. The AU’s name change was conceived in March 2001 at the Assembly of Heads of State and Government hosted by the former Libyan leader Colonel Muammar Kaddafi in the tented city of Sirte (Magliveras & Naldi, 2002). To this day, the AU has not succeeded in ushering the much-needed concepts of Pan-African ideology, self-sufficiency, political stability and political maturity. Union representatives constitute nations that have been colonized by European powers England, Italy, Spain, Portugal, and France respectively. The continent has become a source of competition for bigger powers given the vast untapped natural resources it contains.

Organizational Mandates

The term mandate implies the duration an individual holds an office or the timeframe required for the establishment of a certain mission. The AU is divided into various departments with the highest jurisdiction and the most important one being the Assembly of the African Union currently headed by President Yayi Boni of Benin who took over from Teodoro Obiang Nguema Mbasogo of Equatorial Guinea at the 18th ordinary meeting of the Assembly in January of 2012. Other important political institutions of the AU include the Executive Council that comprise foreign ministers of member states, the Permanent Representatives Committee based in Addis Ababa, Ethiopia; and the Economic, Social, and Cultural Council (ECOSOCC) which is a civil society consultative body. Jean Ping of Gabon is the current chairman of the AU Commission. Other political structures managed by other member states include the African Commission on Human and Peoples' Rights based in Banjul, The Gambia; and the New Partnership for Africa's Development (NEPAD) and APRM Secretariats and the Pan-African Parliament that are housed in Midrand, South Africa.

The AU has various mandates that guide its operational procedures. As Armstrong (1982) construes, discussions regarding the importance of mandates have become widespread in recent years in organizations that give thorough thought and reflection to organizational mode of operations. According to Bryson (2004), mandates exist to define the importance of “laws, regulations, and ordinances, articles of incorporation, charters, and so forth (p. 97-98)”.
One outstanding AU mandate is what became known as the Sirte Declaration adopted during the Fourth Extraordinary Session of the Assembly on September 6, 1999 in Libya coinciding with Muammar Kaddafi’s thirty years of autocratic rule. The adoption of the treaty was a change of nomenclature and a refurbishment of the old OAU governing system that paved way for the issue of human rights in the continent (Udombana, 2002). This mandate bounds Union members to observe the importance of human rights in their respective countries. The second mandate was named the Banjul Charter and was mandated to enforce and restore the dignity of the African woman. The third mandate is the issue of self-determination which allows Africans to help each other to get out of the horrors of European colonialism into an atmosphere of peace, prosperity, and unity (Blay, 1985). The crafters of the OAU and AU mandates have succeeded in their efforts to restore the rights of the oppressed African; they fought for the rights of the African woman; and they have succeed in ensuring that no African nation remains under the shackles of colonialism.

Mission and Values

The mission that acts as a driving lever for the UA is ensuring efficient and value-adding institutions that exist to integrate and develop African Union member states. The values the Union looks to as a guiding principle is mainly geared toward respect and diversity of teamwork, the existence of transparency and accountability, nurturing integrity and impartiality, efficiency and professionalism, and sharing of information and knowledge among member states. One fundamental Socratic question that binds the relevant governing principles of the AU while ensuring efficacy in its dealings with the international community and within member states is: What factor is hindering the AU from accomplishing its goals and expectations? The answer to this question lies with the manner of governing and leadership styles that have remained the same despite of change of administrations since the sixties.

Stakeholder Analysis

Major stakeholders of the AU include the Assembly, the Executive Council, and the Pan-African Parliament. The Assembly is the highest authority as it holds the banner for the AU and is by far the most important stakeholder in the implementation of policies. The Assembly, the most powerful organ of the Union, has the power to expel any rebel state that it finds absconding justice. It is also empowered to elect members of the Court of Justice and the Chairman of the Commission. The Executive Council, working directly with the Assembly, is responsible for matters pertaining to restoration of peace and peacekeeping operations. These three stakeholders of the AU constitute a group with common interests and agendas and are thus responsible for spearheading the political, social, and economic ideals of the massive continent. They do observe the statutes of a charter that is sacrosanct and legally binding. According to Dewhurst and Fitzpatrick (2005), stakeholders can be made into advocates through the use of the structured approach. Regardless of the equality of member states as enshrined in the AU constitutional stipulations, still, there are a few select nations that enjoy leverage over others-like Libya of old under Muammar Gaddafi. Union members are bound by unalterable process guidelines that are akin to democratic institutional governance which is separation of powers. Through the use of co-optation, Union members are able to succeed in their projected activities. The AU solicits funds from donor nations like the EU and the U.S. to accomplish its missions. Financially, the Union cannot survive without philanthropic assistance from big powers like the EU and the U.S.

External and Internal Environments

The term SWOT is an abbreviation for strengths, weaknesses, opportunities, and threats. Its use proliferated during the last few decades and as such its demand is getting much more attention among academics who wish to see their writings practiced and perfected in the field. The use of SWOT by organizations is getting remarkably widespread as its effective use and sound implementation have become a source of solace for many struggling organizations beset by either poor management practices or by economic despair. Lee, Lo, Leung, Ruth, & Andrew (2000) are of the opinion that SWOT is a method used to scrutinize organizations and their working styles based on their strengths, weaknesses, opportunities, and threats. To be able to identify the strengths of an organization like the AU, the main internal and external factors at play will have to be given utmost attention. The strengths of the African Union (AU) include overseeing the relationships that exist between the fifty-three nations that form the union, ensuring existence of leadership to deter vacuum in governance, monitoring of a diverse staff drawn from member states employing various cultures, skills, and background. To the contrary, weaknesses focus on factors related to customer conduct and overall contentment in the delivery of services. The weaknesses of the AU are varied and according to Sherman (2007), organizations have been in the practice of strategic management for over a century. Unequal workforce and diminishing resources that cannot support the explosive continental population are some other weaknesses that need deliberation and containment. The AU suffers from low organizational culture, intangible teamwork that is not up to its reputation, and directorial and guidance challenges confounded by differing political ideologies (Ping, 2009).

Endorsement of organizational culture rewards system, performance measurement, and integrated business planning are vital concepts in organizational successes (Aguilar, 2003). Some opportunities include transitioning to international level, creating a remarkable financial structure, partnering with other nations in elevating the way the union is managed, and partaking in manufacturing strategies. There is the need for member states to speak in one voice to overcome their grievances be it be territorial disputes, economic conflicts, immigration concerns, water wars, and military incursions through dialogue and settlement. Threats that can cripple the smooth running of the union emanate from uncontrolled pandemics, gender inequality, dependency on diminishing resources, and rising food and energy needs.

Strategic Issues

There are multiple burning strategic issues that deserve to be addressed within the AU. Some important strategies that come in the form of questions include: How can African states transform their national economies so as to attain sustainability? How can the current dangers associated with state formation be curtailed? How can Africa’s poor labor relations disputes be regulated? These are the major questions that need answers if Africa is to move forward and compete with the international community of nations. Transforming Africa’s national economies will create better opportunities for the millions that currently suffer deprivation, hunger, and disease. Africa has the potential to succeed if its people are allowed to choose governments of their choice. The few governments in the continent that have embraced democracy seem to fare better than those that continue to cling to authoritarianism. Having effective labor relations will ensure the rights of the employee are protected.

Strategies to Address the Issues

The issue of the economy can be addressed through education, communication, and implementation of advanced technologies while working hand in hand with member states and other industrialized nations globally. There has to be commitment to successful agricultural advancement and industrialization so that every citizen can have food on the table and have access to other vital basic needs. Leaders of the Union must commit themselves to the applications of democracy and accept to transform their governing styles by allowing their citizens to choose their preferred leaders through the ballot box. The AU should compel itself and impose punitive measures on nation’s that fail in their pledges to overturn their governing systems. The use of a rapid deployment force drawn from multi-disciplinary contingents, according to Ciliers (2008), can be used as effective tools for pressuring nations reneging on their pledges or commitments. Often, failure by nations to interfere in the internal affairs of other nations, according to Carbone (2002), results from skepticisms and paralysis. Alemayehu and Kebret (2007), feel that even Africa’s strongest economic organization, the Common Market for Eastern and Southern Africa (COMESA), suffers from lack of political assurances, overlapping memberships, and poor private sector involvement. The creation of trade unions must be enhanced and enforced so that employees can have access to better services and benefits at work.

Adopting the Strategic Plan

Adopting the strategic plan can either be emergent or deliberate. In the case of the AU, adopting the five-part process will trigger better results. According to Bryson (2004), the five-part process can be applied to overcome misconceptions and unending conflicts that can cripple an organization in the long run. Leaders of the AU will have to be empowered to undertake conventional strategies that lead to the realization of their desired outcomes. Posing questions when dealing with specific issues will help alleviate existing and future huddles. Use of graphs will help chart where failures are bound to occur. By applying the oval mapping strategy and the five-part process, leaders that are endowed with the power to oversee and intervene, can be assured of progress in the long run.

Organizational Future Vision

The organizational future vision for the AU member states entails having an inherent notion of commitment and success in every mission. The outcome of the AU vision statement is a result of inspirational decision-making exercises. By adopting the basic philosophies enshrined in the AU’s vision statement, every nation will experience power and efficiency in its overall operations. By observing visional guidelines, the Union will eventually end up regaining its prestige in the international arena. Reliance on foreign hands will ultimately diminish and a sense of pride and prosperity will engulf the continent.

Implementation Process

Three important guidelines that can place the Union in a better place include the use of general guidelines that help in organizing human needs, budgetary needs, and human efforts (Bryson, 2004); planning through the use of effective communication and education, and building platforms as appropriate indicators. However, to envision success in the implementation process, strategic planners will have to be given the tools that will enable them to execute their responsibilities without interference of any sorts. Having highly qualified personnel will be an added advantage in creating advocates for administration.

Monitoring and Re-evaluation

Monitoring and re-evaluation is another term for re-assessing and revisiting practical procedures that have been put in place in the past. It is prudent to ensure the firm structural and strategic foundations earlier put in place are never left unattended or abandoned. However, lack of resources or shortage of funds may lead to breakdown of strategic plans. The issue of human rights violations-which is failing to protect fellow citizens from all sorts of harm and giving them their rights as enshrined in the constitution without regard to race, creed, color, religion, national and political origin-is an enigma in many African countries. In Africa, as many women get educated, their empowerment and their presence in the political, social, and economic field are seemingly gaining ground. The issues of the rights of the citizen and empowerment of women will need re-evaluation as change of power within ruling elites could turn catastrophic at times.

Reflections on the Strategic Planning Process

Strategic planning process can inject a sense of awareness and understanding if allowed to take its effective course. It is not a policy meant only for top CEOs and other cadres of society holding higher offices in public and private enterprises. Use of vision, goals, and issues that are specific to any organization would be the best way to garnering support for my future project and organization. Strategy change is possible when processes specific to an organization are tailored to suit the steps to be taken (Bryson, 2004). Issues can be managed by strengthening relations with stakeholders and shareholders and as well streamlined through the use of the five-part process. Implementation failure is failure of formulation and must be avoided at all cost. After all is done, it will be prudent to make a review of strategic plans so that past errors are kept at bay and never allowed to evolve again.

References

Aguilar, O. (2003). How strategic performance is helping companies create business value. Strategic Finance, 84(7), 44-49.

Alemayehu, G. and Kebret, H. (2007). Regional Economic Integration in Africa: A Review of Problems and Prospects with a Case Study of COMESA. Journal of African Economies, 17 (3): 357-394.

Armstrong, S.C. (1982). The value of formal planning for strategic decisions: Review of empirical research. Strategic management journal 3, 1982, 197-211.

Blay, S. K. (1985). Changing African Perspectives on the Right of Self-Determination in the Wake of the Banjul Charter on Human and Peoples′ Rights. Journal of African Law, 29, pp 147-159 doi: 10.1017/S0021855300006653

Bryson, J. (2004). Strategic planning for public and private organizations: A guide to strengthening and sustaining organizational achievement. San Francisco, CA: Jossey-Bass.

Carbone, M. (2002). From OAU to AU: Turning a page in the history of Africa. The Courier ACP-EU. Retrieved from http://ec.europa.eu/development/body/publications/courier/courier194/en/en_030.pdf

Cillier, J. (2008). The African Standby Force: An update on progress. Institute for Security Studies, ISS Paper 160. Retrieved from http://dspace.cigilibrary.org/jspui/bitstream/123456789/30855/1/PAPER160.pdf?1

Dewhurst, S. & Fitzpatrick, L. (2005). Turning stakeholders into advocates. Strategic communication management, 9(6), 6-7.

Magliveras, K.D. & Naldi, L.G. (2002). The African Union-A New Dawn for Africa? The International and Comparative Law Quarterly 51. 2 (Apr 2002): 415.

Sherman, H., Rowley, D.J., & Armandi, B.R. (2007). Developing a strategic profile: The pre-planning of strategic management. Business Strategy Series, 8(3), 162-171.

Touval, S. (1967). The Organization of African Unity and African Borders. International Organization (January 1, 1967).

Udombana, N. (2002). Can the leopard change its spots? The African Union treaty and human rights. American University International Law Review, Vol. 17 Issue 6.

Accrual and Cash Accounting

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Accrual accounting is basic accounting that recognizes when income is earned and how expenditures are incurred. Accrual accounting is usually recorded at the end of an accounting period despite cash not being paid or received. One example of accrual accounting is dividend, accrued salary, and income earned on stock. Understanding the importance of double-entry bookkeeping which is recording transactions in two accounts and with each account having two columns was the work of Luca Pacioli who documented it in his celebrated work Summa (Rey, 2008). Accrual accounting should not be confused with actual accounting. Unlike cash accounting which is used by businesses that have no employees or inventory, accrual accounting has become a generally accepted accounting principal (GAAP) because income is measured when it is earned and expenses when incurred. Accrual accounting is not meant for commercial governmental organizations even though it is underlined that it should be used in the management of government financial resources (Jones, 2008).

The primary objective of providing the basics for accounting is to allow management to comprehend and have a firsthand knowledge of the necessary information required for decision making. Understanding the basics of accounting requires having knowledge of the concepts of computation per units, preparation of financial statements, and computation of relevant costs that are part of basic accounting costs. In accrual accounting organizations will have a better picture of their financial positions one way or the other. Accrual accounting is used in countries such as Australia, New Zealand, the Netherlands, Switzerland, and the United Kingdom. In the U.S., GAAP requires government entities to use full accrual accounting which is the method for the private sector (Mikesell, 2011). Thus, it is undesirable for organizations to use cash accounting in their business transactions. Instead, it is preferable to stick to accrual accounting which has become the norm of business transactions for modern organizations.

References

Jones, R. (2008). Implementing reforms in public sector accounting: Comparative international governance accounting research. Susan Jorge (ed.). Imprensa da Universidade de Coimbra.

Mikesell, J.L. (2011). Fiscal Administration: Analysis and applications for the public sector (8th ed.). Boston, MA: Wordsworth Cengage Learning.

Rey, J.D. (2008). Algebraic operations in an early-sixteenth century Catalan manuscript: An approach to the possible sources. Seminarid d’historia de la cienca Universitat Pompeu. Retrieved from http://www.upf.edu/hciencia/docampo4.pdf

Developing Strategies to Address Strategic Issues

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The African Union (AU), based in Addis Ababa, Ethiopia, was formerly known as the Organization of African Unity (OAU). It changed name in 2002 to become the African Union. The AU represents the political, social, economic, and cultural issues affecting the African continent. It was formerly established to fight colonialism and apartheid. Despite being formed to usher the continent into a new environment of peace and prosperity and foster solidarity with newly independent states and preserve the idea of sovereignty, the continent got immersed in explosive debts and bureaucracy, genocide, conflicts, and dictatorships in later years (Carbone, 2002). Modeled from the European Union style of governance, the AU is composed of an Assembly, a Commission, a Central bank, a Court of Justice, a Parliament and eventually a common currency. The Assembly, the supreme organ of the Union, is populated by all heads of states drawn from fifty-four member states. The Kingdom of Morocco is the only state that is not a member of the Union. Morocco left the Union in 1982 after the OAU recognized the Sahrawi Democratic Republic as a sovereign nation.

The AU has various strategic issues that need addressing; however, the two most burning issues are commitment to democracy and failure to intervene in the affairs of member states. Since the AU is managed by a difficult bureaucracy, it is hard to convince other heads of states to come to agreement as to how the issues can be curtailed. To get out of this stagnation and usher in tranquility and prosperity, member nations will need to speak with one voice and ensure every agenda is fulfilled. Imposing mentality is still ingrained in the minds of many African leaders who are themselves vestiges of colonialism.

The two approaches to strategy development that would best serve to bring about progress in the way the AU is organized would be implementation of the five-part process and the oval mapping approach. Since the AU is unable to come to grips with daily natural and manmade occurrences, it would be prudent for decision-makers to imagine grand alternatives by formulating proposals that will help them prosper in their endeavors. In the case of commitment to democracy, member states will need to pledge to transform their governing styles within a certain period of time. Nations found contravening democratic norms will have to be censored and denied further funding. By working with foreign financiers, the AU can monitor the democratic processes in the said states.
Failure to interfere in the internal affairs of other member states is caused by skepticisms and paralysis caused by competing interests of member states who at times side with one party against the other (Carbone, 2002).

According to Alemayehu and Kebret (2007), an organization like the Common Market for Eastern and Southern Africa (COMESA) has been struggling with several issues that include lack of political commitment, overlapping memberships, and poor private sector participation. By applying the five-part process to the problems encountered by the AU, strategic policy implementations can be achieved. African leaders will have to undertake conventional strategies by posing questions then imagining when dealing with specific issues noted above. These questions will give the leaders ideas as to the exact causes of evasions in the implementations of desired practical alternatives, dreams, and visions. Another point worth deciphering will be uncovering the causes of barriers to the realization of major alternatives, dreams, and situations. This should be done by taking actions that are conducive to the environment. Union leaders will have to follow the laid down proposals. To overcome the bureaucracy that has been impeding the smooth operations of the Union, member states will need to charter a new course that ensures those endowed with authority work meritoriously and bring in recognition to the affected department under review. A commission could be used to make follow ups and prepare final recommendations so that differentiations can be made between the unproductive and efficient leaders.

The five-part process, according to Bryson (2004), can be an effective tool in dissuading misconceptions and conflicts in the workplace environment.
In its final analysis, the commission will be tasked with taking specific actions to rectify the volatile situations. AU’s strategic planners, who are part of the proposed commission, will have to come up with a final solution and make recommendations to member states and donor nations so that travel restrictions, economic sanctions, and other measures can be imposed on nations found to be contravening the set up norms. On the other hand, commission members will need to use the oval mapping process to activate mandates, mission, and stakeholder analyses. Graphs will be required to chart progress and failures. Thus, the oval mapping strategy and five-part process will serve as the most helpful strategies in the formulation of an effective work ethic in the AU’s official structural foundations.

References

Alemayehu, G. and Kebret, H. (2007). Regional Economic Integration in Africa: A Review of Problems and Prospects with a Case Study of COMESA. Journal of African Economies, 17 (3): 357-394.

Bryson, J.M. (2004). Strategic Planning for Public and Nonprofit Organizations, 3rd Ed. San Francisco, CA: Jossey-Bass.

Carbone, M. (2002). From OAU to AU: Turning a page in the history of Africa. The Courier ACP-EU. Retrieved from http://ec.europa.eu/development/body/publications/courier/courier194/en/en_030.pdf

Stakeholder Buy-in

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Formerly known as the Organization of African Unity (OAU) and founded in 1963 in Addis Ababa during the reign of Emperor Haile Selassie of Ethiopia, OAU changed name in 2002 to become the African Union (AU). Still headquartered in Addis Ababa, Ethiopia, the African Union is an organization founded on the principles of advancing the nations that constitute the African continent. The only country in the African continent that is not a member of the AU is the Kingdom of Morocco (Hanson, 2009). Deliberations on important administrative and political issues that touch on member states is usually the prerogative of the Assembly of the AU whose consultative members are drawn from heads of states that hold semi-annual meetings. In the case of the AU, member states are the major stakeholders as they strive to come to terms with the issues that can make the organization self-reliant politically, socially, and economically. The AU has a 265-member Pan-Africa Parliament whose current head is Idriss Ndele Moussa of Chad who was elected in May 29, 2009. This system of power sharing among member-states is pluralistic in context as opposed to elitism where power is concentrated in the hands of an influential few.

According to Brugha and Varvasovszky (2000), actors or stakeholders have been garnering increasing role in influencing organizational decision-making and policy formulations in the last few years. The general objectives of AU member-states is to promote the political and socio-economic cooperation of the continent, protect issues of interest to member states, safeguard peace and security among member-states, and enhance democratic governance and human rights (Hanson, 2009). The current chairman of the AU is Teodoro Obiang Nguema Mbasogo of Equatorial Guinea who took over in January 2011 and has led his country since 1979 after ousting his uncle Francisco Macías Nguema in a bloody coup. The use of effective communication is the driving factor that brings together member-states with varying political and social ideals. According to Dewhurst and Fitzpatrick (2005), getting buy-in from senior level management and having the confidence and endorsement of the right people among internal circles can help alleviate future inconsistencies among stakeholders.

Organizations have a better chance of succeeding in their business pursuits when they give credence to stakeholder participation in a win-win style. Gousseau (2008) is of the opinion that stakeholders are those people in institutions and organizations that are visible in school boards, municipalities, and district hospitals. Stakeholders are an integral part of organizational businesses and therefore deserve to be treated with care to ensure strategic planning processes go according to plan. Stakeholders play a great role in the running and rejuvenation of business transactions. However, stakeholder identification and prioritization should be the prerogative of top level management in businesses (Parent and Deephouse, 2007).

Two important strategies that could be used to enhance better buy-in within the AU are a structured approach and mapping out advocacy. Since the AU is an organization that exists to be of service to a massive continent with over 50 member-states, laying the foundations for advocacy groups that will relay vital communiqués and other organizational decrees will help streamline the mapping of intended actions and procedures. Mapping out advocacy entails ensuring identified stakeholders that are at ease and in good terms with proposed strategy or activity. Having a structured approach will help affect a strategy that is conducive to the environment and major stakeholders.

References

Hanson, S. (2009). Backgrounder: The African Union. Retrieved from http://www.cfr.org/africa/african-union/p11616

Gousseau, K. (2008, July 22). Seniors key concern in strategic planning: Stakeholder meeting in city Thursday. Alaska Highway News, A.1.

Parent, M. M., & Deephouse, D. L. (2007). A case study of stakeholder identification and prioritization by managers. Journal of Business Ethics, 75(1), 1–23.

Dewhurst, S., & Fitzpatrick, L. (2005). Turning stakeholders into advocates. Strategic Communication Management, 9(6), 6–7.

Brugha, R., & Varvasovszky, Z. (2000). Stakeholder analysis: A review. Health Policy and Planning, 15(3): 239–246.

Strategic Planning and Internal Factors

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The African Union (AU), formerly the Organization of African Unity (OAU) was founded on 25 May, 1963 with the aim of improving the political, economic, and cultural aspects of the continent. OAU changed name in 2002 to become the AU. It’s headquartered in Addis Ababa, Ethiopia (Hanson, 2009). The AU is made up of political and administrative bodies. Heads of States meet yearly to deliberate on important topics that are exclusive to the continent. The Kingdom of Morocco is not a member of the AU because it disputes the membership of Western Sahara, also called the Sahrawi Arab Democratic Republic. The Union’s internal environment is populated by member representatives heading various departmental positions.

Internal factors that often cause friction and dissent among member states include disagreeing on specific volatile issues like voting on matters that may be of particular importance to a certain state but detested by another. Member representatives may disagree on how money donated by donor nations is dispensed. The governing style espoused by a chairman may not be acceptable to others. For example, the current chairman of the AU is Teodoro Obiang Nguema Mbasogo, the president of Equatorial Guinea who came to power by the barrel of the gun. A corrupt and ruthless dictator, President Obiang heads an oil rich state whose citizens live in abject poverty. The Union is struggling with ambitious internal reforms that include security, trade liberalization, sustainable use of natural resources and energy, food security, and climate change and immigration (Laporte and Mackie, 2010).

The main actors of the AU have been drawn from nations that were at one time or the other colonized by colonial powers Britain, France, Italy, and Portugal respectively. To the north are the mainly Arabic speaking states of Egypt, Tunisia, Algeria, and Mauritania. Cultural differences among leaders often lead to misunderstandings and confusion.

References

Laporte, G. and Mackie, G. (2010).Towards a strong African Union: what are the next steps and what role can the EU play? Retrieved from www.ecdpm.org/pmr18

Hanson, S. (2009). Backgrounder: The African Union. Retrieved from http://www.cfr.org/africa/african-union/p11616

Impact of Internal Factors on Strategic planning

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Formerly known as the Organization of African Unity (OAU), the African Union (AU), the subject of my final paper, was founded in 963 in Addis Ababa, Ethiopia. It changed name in 2002 to its current name. It was founded on the basis of spearheading pan-Africanism though lately it has transformed itself into a behemoth organization that stands for continental unity, sustainable development, and economic equilibrium in an expansive sphere of the globe beset by a cornucopia of human and natural disasters (Adogamhe, 2008,). The African Union is representative of people of various nationalities and diverse cultures that include black tribal communities, a minority White race, and a sizable number of societies belonging to the Arab race. It represents various social groups speaking hundreds of vernaculars and colonial languages that include Portuguese, English, Spanish, English, and French respectively.

To date, there are eighteen strategic objectives that drive the Union’s pursuit of its desired goals. In its executive summary, the Union’s comprehensive strategic objectives include programs that highlight the importance of peace and security, development, integration, cooperation, shared values, and program for institutional and capacity building (Ping, 2009). A breakdown of the Union’s SWOT analysis specifies many negative and positive aspects. Some of its strengths include the integration of the fifty-three union members, having the mandate to make arrangements for existing institutions, having distinguished recognition in the international community of nations, a leadership that strives to implement changes, shared values that rest on the philosophy of pan-Africanism, and the capacity to call all members to a projected venue whenever required. The weaknesses that plagues the Union include challenges in administration and management, lack of funds and resources, missing rigid infrastructure, shortage of professionals, lack of commitment, missing teamwork, uncertified or weak information technology resulting from weak processes. Some opportunities that are of advantage to the Union's smooth running and operation include empowering women, gesture of goodwill and benevolence by mindful partners, expectations in the restructuring of its financial structure, and the need to speak in one voice. Threats include uncontrollable pandemics, limited resources, marginalization and gender inequality, sporadic outbreak of conflicts and unpredictable internecine warfare, stagnated economy, and scarcity or lack of commodities.

Directing an organization to the right course without having a systematic management plan can be a daunting task. According to Sherman (2007), the use of strategic management in organizations has been in place for over a century. In modern times, the proliferation of literature exclusive to strategic management and planning coupled with the presence of educational institutions of higher learning have set the stage for drastic revolutionary changes in a world brimming with technological advancement and knowledge. Besides spearheading strategic management, organizations need to endorse strategic management by highlighting the importance of strategic planning, performance measurement, integrated business planning, management reporting, and organizational culture reward systems (Aguilar, 2003).

The Union's internal organizational environment is populated by member states having differing leadership styles and poor governing approaches that is the cause of the appalling human development statistics. Undemocratic governing practices, abuse of office and widespread corruption, absence of accountability, state repression, appalling human rights records, financial instability, and missing regulatory frameworks remain an impediment in many African governments. Each and every African state has a representation at the Union headquarters in Addis Ababa and at the pan-African legislative assembly in Midrand, South Africa. A rotating chairmanship allows every African head of state to hold the helm at the approach of term. Within the Union there are those leaders that harbor suspicion and betrayal by not conforming to the Union’s code of ethics. Despite a handful of states espousing democracy as the preferred system of governance, on the other hand, there are those whose governing ideals rest on the advancement of feudalism, theocracy, and dictatorship which is cause for the derailment of many contentious issues.

Most African states evolved from the ashes of Anglo-Franco colonialism that dissipated when many African leaders who pioneered their nations’ right to self-determination stepped into the shoes of their former colonial masters. The newly emerged African leaders that took over the helm did little to transform the political, social, and economic sectors that required resuscitation. Instead, they embarked on the suppression of civil society leaving destruction in their wake. The divisions left behind by the colonial masters created a new social order deficient of political, social, and economic willpower. Thus, the vestiges of colonialism left a lot to be desired. Even to this day, African heads of states remain inclined to their former colonial powers militarily and economically. The schisms that exist within the AU’s inner circles deserve rectification before any leap forward can be attempted.

References

Adogamhe, P.G. (2008). Pan-Africanism revisited: Vision and Reality of African unity and development. African Review of Integration, Vol. 2 No. 2, July 2008.

Aguilar, O. (2003). How strategic performance is helping companies create business value. Strategic Finance, 84(7), 44-49.

Ping, J. (2009). African Union Commission: Strategic plan 2009-202. Retrieved from http://www.au.int/en/sites/default/files/Strategic_Plan2009-2012.pdf

Sherman, H., Rowley, D.J., & Armandi, B.R. (2007). Developing a strategic profile: The pre-planning of strategic management. Business Strategy Series, 8(3), 162-171.

S.W.O.T Analysis

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The Kansas City Missouri School District was founded in 1876 with the intention of providing education to the children of the residents of Kansas City. Initially, the school district started with 2,150 students. Prior to the current prevailing conditions, the school district employed 2,300 teachers who were responsible for the education of a staggering 17,400 students from all walks of life (KCMSD, 2011). Currently, the school district is without accreditation and that its fate remains in the hands of the state. Power jostling, self-interest, greed, and infighting among the leaders of the school district resulted in KCMSD losing its accreditation (Clark, 2011). Poor strategic planning and unregulated learning strategies, and dismal performances by the students in general education are some other factors that plunged the school district in to its current legal quagmire.

The term S.W.O.T is an abbreviation for Strengths, Weaknesses, Opportunities, and Threats and is an important tool in determining how an organization functions. As for strength, KCMSD lacks financial capability, philosophy and value, and accreditation and qualification features; it is short of the required cultural, attitudinal, and behavioral aspects because of the prevalence of power jostling, self-interest, and greed within the governing board. Dr. Covington, an African-American and former superintendent of the school district, resigned hurriedly and unexpectedly in 2010 (Resmovits, 2011). He was replaced by Dr. Steven Green (Seward, 2011), also an African-American who is faced with the heavy task of reestablishing himself in an atmosphere of opposition and suspicion. There is visible weakness in how the school district is administered-weaknesses that emanate from gaps in capabilities coupled with poor morale, commitment, and leadership. Incompetency on the part of the school district leadership and pressure from parents and the state result in general vulnerabilities.

Some of the opportunities that could enhance the smooth operations of the KCMSD include making use of existing technology and other existing innovative ideas. Relevant threats that need to be curtailed include political, legislative, and environmental effects. The school district is expected to make drastic changes and make complete overhaul to the factors that led to its loss of accreditation in a two-year period. Failure to do so will result in the intervention of the state and the court system. The school district has the potential to succeed by effectively utilizing money given by the state, making comprehensive annual reports, abiding by the fundamental principles of finance, avoiding misappropriation of funds, and regularly abiding by existing mandates.

References

Clark, M. (Sept. 20, 2011). Missouri Department of Elementary Education. State board reclassifies KCMSD to unaccredited. News releases Vol. 45, No. 79. Retrieved from http://dese.mo.gov/news/2011/kcmsdaccreditation.htm

Kansas City, Missouri Schools District (2011). About KCMSD. Retrieved from http://www2.kcmsd.net/Pages/AboutKCMSD.aspx

Resmovits, Joy (August 26, 2011). John Covington, Kansas City Superintendent, Resigns Suddenly Amid School Board Drama. http://www.huffingtonpost.com/2011/08/25/john-covington-resigns-kansas-city_n_937241.html

Seward, L. (August 31, 2011). Dr. Steve Green is Kansas City Missouri School District's new interim superintendent. http://www.nbcactionnews.com/dpp/news/education/dr-steve-green-is-named-kansas-city-missouri-school-district-interim-superintendent

Comprehensive Financial Annual Report (CAFR)

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Formed in the sprawling suburbs of Addis Ababa, Ethiopia, in 1963 under the tutelage of the renowned Statesman Haile Selassie, the Organization of Africa Unity changed named in 2002 to become the African Union (AU). The AU was formed exclusively to spearhead social, economic, and cultural values in the African continent that is populated by diverse communities speaking various vernaculars and divided along colonial powers Italy, Britain, Portugal, and France respectively.

A Comprehensive Financial Annual Report (CAFR) is a large document that is produced by organizations to provide vital information to officials, citizens, auditors, and investors (Mikesell, 2011, pp. 77). It is a report that is available to the general public and generally documents how funds are dispensed and accounts utilized. The AU's CAFR is one collected from a broad range of willing donors that include the United States, the European Union, and member states whose economies show signs of stability. The money collected in the form of aid is then used to serve the various departments that are part of the Union. Some of the aid coming from donor nations is used to fight pandemics and keep peace in volatile regions of the world such as in Somalia, Darfur, and other conflict prone areas of the mighty continent. Poor tax collection, bleak transparency index, misuse of resources, widespread corruption, and mismanagement are some factors that make the Union financial to operate below average and show signs of decline.

The report is geared towards giving donors vital information on how finances are utilized and how transparency and poverty reduction is being tackled. A $200 million budget was released in 2010 to finance various developmental projects. 30% of that money was earmarked for restoration of peace in afflicted areas, 77% for development, and 10% for fighting corruption (Tekle, Sudan Tribune, January 31, 2010). Citing Schick (1998), Sophia (2002) explains that the budget composition of poor countries within the continent is by far different from those of developed countries. An aspect know as the common pool problem where officials involved in the budget decision-making process fight over public resources hamper efforts to distribute or dispense finances equally (Sophia, 2002). The African Union budgetary processes suffers unrealistic budgeting where the budget is commonly accepted as a farce, hidden budgeting where the budget is known to a select few, and escapist budgeting where expenditure is authorized while knowing it will never materialize. Unpredictable governments hinder stakeholders’ prospects of comprehending its aims, objectives, and outcomes.

References

Mikesell, J.L. (2011). Fiscal Administration: Analysis and applications for the public sector (8th ed.). Boston, MA: Wordsworth Cengage Learning.

Sophia, G. (2002). Budget Institutions and Fiscal Performance in Africa. Center for Research in Economic Development and International Trade, University of Nottingham. Retrieved from http://www.nottingham.ac.uk/credit/documents/papers/10-02.pdf

Schick, A. (1998) A Contemporary Approach to Public Expenditure Management: World Bank Institute.

Tekle, T.A. (Sudan Tribune, January 31, 2010). USD 200 million agreed for 2010 Africa Union Budget. Retrieved from http://www.sudantribune.com/USD-200-million-agreed-for-2010,33967

Balancing Budget

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The best way to overcome budget deficits is through spending cuts or raising taxes (Yaya, 2010). Citing Buchanan and Wagner (1978), Yaya (2010) contends that an increase in taxes could be a remedy for deficits. There is agreement among economists that balancing the budget would allow interest rates to fall, savings and investment to go up, trade deficit to contract and the economy to grow more rapidly over a longer period of time. However, that is not the case for congressional leaders who have made budget balancing a subject of furious debate every time the issue is raised up for discussion. Budget balancing may not be good for every American. A good number of Americans, especially those of lower income who disproportionately rely on government assistance could be affected if the budget is balanced. Balancing the budget may have ramifications at times. Results may vary from year to year for different households and things could go distorted.

Whenever a budget is balanced, there always emerge winners and losers. Beneficiaries include those who benefit from tax breaks, families with young children who benefit through income tax breaks, college students aided by tuition tax credits and higher scholarship grants, and investors who gain from selling stocks and bonds. Balancing the budget is a very difficult issue to deal with. The recent stand-off between President Barack Obama and Speaker Boehner shows how American leaders often times fail to reach consensus on budgetary issues despite seeing the explosive rise in national debt.

References

Yaya, K. (2010). Budget balance through revenue or spending adjustments? An economic analysis of the Ivorian budgetary process, 1960-2005. Journal of Economics and International Finance Vol. 2(1) pp. 001-011.

Buchanan, J.M. and Wagner, R.W. (1978). Dialogues concerning fiscal religion., J. Mon. Econ., 4: 627-636.

The African Union Stakeholder Analysis

Formerly the Organization of African Union (OAU) and founded in 1963 under the auspices of the former emperor of Ethiopia Haile Selassie, OAU changed named in 2002 to become the African Union (AU). With headquarters in Addis Ababa, the capital of Ethiopia, AU constitutes over fifty states excluding the Maghreb kingdom of Morocco. Stakeholder analysis can be used as a tool to determine the purpose and information to be used and help focus on more or various dimensions that will help set the stage for analyzing past, present, near or distant events (Brugha and Varvasovszky, 2000). Since the AU is an amalgamation of third world nations and that it cannot sustain its commitments to the continent by itself, there are economically powerful nations such as those in the western hemisphere that make it operational by providing the necessary financial resources and military gear.

Making stakeholders out of advocates requires a structured approach, mapping out advocacy, and finally closing the gap (Dewhurst and Fitzpatrick, 2005). Of the various organs of the AU, the most important stakeholders that make the organization effective include the Assembly, the Executive Council, and the Pan-African Parliament. However, it is the Assembly that holds the banner for the AU as it is thus far the most important stakeholder in policy implementations. The Assembly is the gathering of Heads of States who converge at a certain venue once every year to deliberate on the issues affecting the continent. The Assembly has the power to expel any rebel state from the Union for a certain period of time. The Executive Council gets directives from the Assembly on matters pertaining to war and restoration of peace by supplying peacekeeping troops where applicable especially in conflict-prone areas. Also, it is the prerogative of the Assembly to appoint the African Court of Justice Members and the Chairman of the Commission. As for the Executive Council, ministers are drawn from member states and they deliberate on certain areas that include foreign trade, social security implementations, agriculture and food subsidies and communication.

The three stakeholders described above work in concert to create a common ground for spearheading the interests of member states. They generally constitute an assemblage with common interests that include a governing body, a union, and interest groups. They are bound by a charter which is inviolable and commensurate with union legislation. However, some countries may have leverage over others for providing the financial means necessary for driving the activities. An example of a country that enjoyed greater influence in the Union was the North African state of Libya whose previous leader, Muammar Gaddafi, shone above every other leader because he spent a lot of money either for a just cause or through using manipulative means to drive a particular agenda to his advantage. Muammar Gaddafi’s economic clout enabled the Union to have a sponsor to give it legitimacy.

By striving and working collectively the AU has developed an initial agreement which is to advance the political, economic, and cultural values of the nations that constitute the broader union. This system has materialized since the founding of the Union in 1963. Finding the right people has been made possible by the various branch members that come together at certain times of the year to choose the right people for the right functions. So far, the Union has had tangible process-oriented outcomes in its determination to succeed. The Union has a process guideline which is separation of powers as in a democratic institution where every level of government strives to reach required expectations while keeping in touch now and then to sort out differences. The level of support given by the sponsor and the joint workings of the three branches is what is giving the Union legitimacy while at the same time driving it to the right course. The participation of stakeholders in the Union increases the chances of buy-in and commitment. Co-optation is another aspect that makes the Union to succeed in its endeavours.

References

Brugha, R & Varvasovszky, Z. (2000). Stakeholder analysis: A review. Health policy and planning, 15(3): 239-246.

Dewhurst, S. & Fitzpatrick, L. (2005). Turning stakeholders into advocates. Strategic communication management, 9(6), 6-7.