2021 AGM Financial Statement

ANNUAL REPORT &
FINANCIAL STATEMENT
2021
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Table of Contents
Management Committee Members 4

Our Ten Golden Rules 7
CEO’s Desk 8
Chairperson’s Report 9
Treasurer’s Report 13
Business Development Sub-Committee’s Report 16
Real Estate Sub-Committee’s Report 20
Report of the Historical Problematic Lands (HPL) Committee 23
Supervisory Committee’s Report 25
Pepea Fixed Deposit 28

HR’s Desk: Our People 29
Automation through the ERP System 34
Society’s Information 36
Report of the Management Committee 37
Independent Auditor’s Report 38
Statement of Management’s Responsibilities 42
Statement of Management’s Representation 43
Financial Report 2021

2022 & 2023 Budget 46
Statistical Information 47
Statement of Profit or Loss and Other Comprehensive Income 48
Statement of Financial Position 49
Statement of Changes in Equity 50

Statement of Cash-flow 51
Accounting Policies 52
Notes To The Financial Statement 56
Taxable Income Computation 63
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 3

Board Members
Peter Gichangi
Chairperson
Peter is an opportunity development specialist driven by a passion to deliver innovative yet practical local solutions
that have global impact. Peter has over 14 years’ experience spanning software development, solution architecture
& design, product & services development, innovation, strategy and business development.
Peter holds a Master of Science degree in Information Technology from Strathmore University, a Master of
Science Certificate in Business Analysis from the George Washington University School of Business and a Bachelor
of Science degree in Information Technology from Jomo Kenyatta University of Agriculture and Technology.
Peter is also Certified by the International Coach Federation (ICF) as an Engagement and Productivity Coach.
Tom Macakiage
Board Vice Chairperson
Tom Macakiage has over 20 years distinguished career leading large IT teams, delivering turn-key and
mission-critical IT enabled systems that transform the way firms do business. He is currently the Country Director
at Servetech Systems Limited, tasked with client stakeholder engagement, projects on-Boarding, and PnL. Tom
has previously worked with CfCStanbic Bank as the Head of Information Technology and at Unilever East and
Southern Africa as the Regional IT Manager.
Tom is also the Founder Chairman of Sendy Ltd, a logistics marketplace that provides online end-to-end retail and
freight solutions.
He holds a BSc. in Management Information Systems from Greenwich University, MBA from University of Free
State, South Africa and Masters in Technology Entrepreneurship from the University of Maryland, College of
Engineering, USA.
Judy Runo
Hon. Secretary
Judy is a credible assurance expert. She is a B.Comm, CPAK, SMLP certified coach. She is respected as a credible voice in
assurance and governance with her senior Management experience spanning over 7 years. Currently, in her role as a senior
manager, Safaricom PLC, she oversees the business controls and project assurance. She began her career in assurance with
Deloitte. She takes a vision and makes it a reality through sound strategy development.
Judy intuitively sees the threads of opportunity that wind through an organization, brings them together into a coherent whole,
helps others extend their thinking and drives business advantage.
Vincent Opiyo
Board Treasurer
Vincent Opiyo, FCCA, is the Regional Finance Director at Multichoice Africa. Before this he served in various
Finance roles at Safaricom PLC including Head of Financial Planning and Investor Relations, Head of Finance
Operations as well as Acting Chief Finance Officer at Safaricom Telecommunications Ethiopia. He has also
previously worked at Airtel Kenya, Total Kenya, Uchumi Supermarkets and African Banking Corporation at various
stages of his career. He is a Bachelor of Commerce (Accounting Major) and holds MBA qualification. He is also a
member of the Institute of Certified Public Accountants of Kenya (ICPAK) and Enterprise Risk Management
Academy (ERMA).
As an International Coach Federation (ICF) certified coach, he has a passion for developing young Accountants
into solid professionals through coaching.
Vincent enjoys driving corporate social responsibility agenda in the areas of education, water, agriculture and
sports when away from his Finance duties.
4 SAFARICOM INVESTMENT CO-OPERATIVE

Board Members
Agnes Marete
Board Member
An Associate Consultant and trainer with Kenya Institute of Management (KIM), College of Human Resource
Management (CHRM) and Kenya School of Government in Management, Strategy, Performance Management and
HR. She is an Organizational Performance Index (OPI) assessor for the COYA Awards assessing HR and Leadership.
A lecturer at the CHRM.
She hold an MBA in Strategic Management from USIU, Bed Kenyatta University, Diploma in Project Management
(KIM, Higher National Diploma in Human Resource Management and Certificate in Counseling.
Eng. Emily Kilongi

Board Member
Eng. Emily Kilongi holds a Bsc Degree in Civil Engineering and Msc Degree in Civil Engineering. She is a
professionally registered Engineer with the Engineers Board of Kenya (EBK) and is a member of the Institute of
Engineers of Kenya (IEK). She has more than 16 years’ experience in the field of Civil Engineering mainly focusing on
infrastructure development for large water and sanitation projects. She has vast experience in project
Management and infrastructure development from both the private and public sector and is currently working with
the African Development Bank (AfDB).
Eng Emily Kilongi is also a member of the Institute of Directors (IOD) and the Women in Boards Network (WOBN).
Jackson Mulwa
Board Member
Jackson has a wealth of experience in cooperative Management and leadership.
He holds Master of Business Administration in Finance from the University of Nairobi and Bachelor of Business
Administration from Maseno university. He is also member of Institute of Certified Public Accountant of Kenya
(ICPAK). He has wide range of experience in stakeholder Management, Financial Management, Financial
Accounting, contract negotiation and tax administration& compliance. He is Currently working with Safaricom PLC
as Accounts Payable Manager; he has also served in other various capacities over the last 14 years.
Edward Njoroge
Board Member
Edward is an assurance and risk Management professional with over 15 years experience in the provision of
consulting in the areas of Governance, IT, Finance, legal compliance, risk Management and business process
re-engineering. Edward’s career began at KPMG, where he established himself as a trusted advisor for
Management and Boards across varying industries ranging from banking, insurance, telecommunications,
manufacturing, services, government and public sector development in multiple countries across Africa.
In his current role, as a Senior Manager in Safaricom Internal Audit, he provides assurance and advisory services on
governance, risk Management and controls. In SIC, Edward is the current Chairperson of the HPL Committee that
was created to resolve issues impacting past projects.
He has a Bachelor of Science (BSc) in Computer Science, is a chartered accountant (ACCA), a certified internal
auditor, certified information systems auditor (CISA), certified data protection solutions engineer (CDPSE) and a
certified security manager (CISM).
Mike Akal
Board Member
Michael is a corporate leader with 15 years professional experience in different fields in Sales and Distribution,
Trade marketing, Channel Management, Account Management, Retail and Operations Management and Project
Management amongst others. Michael brings in a wealth of experience to Safaricom Investment Cooperative(SIC)
in the area mobilization of membership from Regional Sales and Operations and Call Centre Operations. He has
great ideas in sales and revenue generation that will shore up the income of the Investment. Apart from his career
ambitions, Michael is a Christian leader that mentors a number of youth and professionals in Kenya. Through this
he has been able to connect and working closely with other Christian leaders

Supervisory Committee
Peter Mukera
Chairperson
Peter Mukera is an ambitious result-oriented professional with an educational background in Computer Science. He
has over 10 years’ experience in Information Technology, Project Management, Customer Service and Retails
Operation. He has served in Supervisory Committee at Safaricom Investment Co-operation in different capacity’s
since 2017. Currently he is the Committee chairperson. During which he has gained a lot of experience, attended
trainings on Governance, strategy Management, risk Management and the business process. He has a bachelor of
science in computer science degree and Prince2 project Management above other certifications.
CPA Beth Wambui Mwangi

Secretary
CPA Beth Wambui Mwangi is a Accountant (CPA K) and a Certified Public Accountants of Kenya. She has Master’s
in Finance and Accounting Option, ICPAK. She also has Bachelor of Science in Agribusiness Management and is
currently pursuing a PHD in Business Management.
She has career experience of over 8 years in customer service ,financial Management, training and accounting. She
has worked for Safaricom Ltd in regional operations and customer service departments where she gained a number
of business competencies which includes but not limited to customer focus.
Rabecca Bisanju
Member
Rabecca Bisanju was elected into SIC Management Committee in the Year 2018. She has a vast experience in
customer relations having worked over 10 years across various functions in customer operations. She also has a
good experience on coaching and people Management having attended various leadership and coaching programs
during the course of her career. She currently supervises operations to ensure excellent customer service delivery
at the Retail Centre, Channels department in Safaricom PLC.
Rabecca holds a Bachelor of Education degree from Kenyatta University, is a certified PRINCE2 Practitioner
(professional project Management) and is also a certified Internal ISO Auditor.
Sarah Wahogo
Ag. CEO
Sarah Wahogo is the current acting CEO at Safaricom Investment Co-operative.

She is a finance professional with over 10 years’ hands on experience in accounting and financial management. She
started her career as a tutor in a local college within Nairobi. With time, she has evolved to be a dynamic,
turn-around leader who is very passionate about organization performance, team motivation and increasing
shareholders wealth. Her mantra is Results, Results, and Results! Sarah holds a Masters in International Economics
and Trade from Moi University, a Bachelor of Business Management from the same institution, CPA (K), and a
Higher National Diploma in Management of Information Systems from the Institute for Management of
Information Systems (IMIS – UK).

Our Ten Golden Rules
1. Customer is King - “There is only one boss. The customer,

and he can fire everybody in the society from the chairman
on down, simply by spending his money somewhere else”.
Sam Walton.
2. Giving returns to our investors is not optional - This is
the sole reason we exist. We therefore have to work ten
times harder than the average real estate society.
3. SIC is our main hustle - Every decision we make is for its
best interest. We remain loyal to this great organization.
4. Prompt - We do not do tomorrow what we can do today.
5. Professionalism and Team Work - We are a team. We
respect our work and respect each other too.
6. Innovation and Creativity - We are open to new ideas, we
learn, teach and enjoy while at it. We posses a growth
mindset.
7. Our People - Our greatest resource is our people. We
provide a working environment where everyone can thrive
and excel.
8. Excellence -Excellence is not too much to ask or offer.
9. Performance is not negotiable.
10. Integrity, Integrity, Integrity.

CEO’s Desk
Dear Esteemed Investors,
On behalf of the SIC Board and all members of staff, I want to pass our sincere
gratitude to you for your continued patronage. 2021 was a great year with a
myriad of activities and events for the organization.
This year saw us launch a number of products that our members and the clients
at large took up very well. These are; Phase 2 of Acacia in Kitengela, Olive
Garden in Katani, Kimuka phase 1 and 2 in Ngong, 4 phases of Ol’Pajeta Ridge in
Nanyuki then culminated the year with Kibos Meadows in Kisumu. These seven
projects have performed extremely well with Kibos and Nanyuki selling out
within a month of releasing to the market.
As your stewards, safeguarding and growing your investment is our key priority.
To enable us to do this, we endeavour to attract and retain talented staff who
are of unquestionable integrity and character. We also ensure that we keep
them highly engaged through the various incentives introduced in the year for
recognizing outstanding performance (see page 32) as people are the secret
sauce that makes an organization great. We are therefore working round the
clock to ensure that we make SIC the employer of choice through the various
initiatives which in turn will ensure that we truly make this society the
investment partner of choice not only in East Africa but across the world .
One of the many initiatives that were introduced in the year was developing the
Sarah Wahogo
10 Golden Rules (see page 7). These rules were developed with you in mind
and speaks to the culture we are engraining in our people as well as about what
we believe in. It is said that culture eats strategy for breakfast, lunch, and
dinner; Peter Drucker. We are extremely keen on growing your wealth by
ensuring that we do the ordinary in an extraordinary way. The golden rules
summarize it all.
With this, we are happy to inform you that we have migrated to a digital
enterprise resource planning system that will ensure our investors are
attended to within the shortest period of time. This system also provides a
self-service portal for our members where they can access their statements,
view their investment portfolio, monitor their shares in the market, and buy and
sell their shares within the system.
2022 being an electioneering year, we hope to make the best out of it. We
have great projects in the pipeline within the Nairobi Metropolitan area and in
the upcountry. We remain committed to giving you premium returns year on
year and we humbly request support by;
Referring members and clients to purchase our products.
Patronizing our products.
Providing platforms where we can market our products e.g. forums where
we can do presentations or contacts of people who can provide the same.
Providing feedback be it positive or negative.
Feel free to extend the same by reaching us at SICCEO@safaricom.co.ke. The
above support will be appreciated with a token for any successful conversion. I
sincerely thank you for your patronage and look forward to a greater 2022.
Thank you. God bless SIC and all of us.
Sarah Wahogo
Ag. CEO

Chairperson’s
Report
Overview
During our 12th AGM on 20th February 2021, we discussed the various
challenges that faced the economy due to the COVID-19 pandemic, its direct
impact on the economy and the resultant cascade effect on businesses,
people’s livelihoods and the overall way of life in the country and around the
world. We noted how Safaricom Investment Cooperative (SIC) had come off
the blocks sturdily at the beginning of 2021 having weathered the tide in 2020.
We carried on the recovery momentum throughout the year with the Board,
the staff and our consultants making rapid corrective actions to ensure we
remained on track. Although we may not have achieved 100% of the goals and
objectives set, I am proud to note that we achieved tremendous growth of
both the top and bottom lines. This is testimony that the turnaround efforts
carried out by the Board and Management are bearing fruits and are setting the
organization up for long term success. To this end, the Board will be making
various recommendations for consideration by the members at the 13th
Annual General Meeting (AGM) which are aimed at solidifying gains made so
far.
You will note from this report that our diversification plans were impacted for a
second year running owing to the continued uncertainty in multiple sectors of
the economy largely due to COVID-19. The Board expects to turn this tide
during the year 2022 as set out by the Business Development Committee’s
plans in page 16 of this report. Our real estate portfolio will continue as the
Peter Gichangi
primary line of business for the foreseeable future as our new business lines
develop. Through the Real Estate Committee, as you will note in page 20 of
this report, the Board believes we have found a sustainable model to spur
further growth and generate even more returns to you, our investors.
In a bid to enhance communication with members and improve overall
governance, the Board held four sessions with members during the year. These
were the AGM held in the first quarter of the year and a member forum held in
each of the other three quarters. I am glad to note that this is the first time in
SIC’s history that such consistent engagement with members has been
achieved. The Board is committed to entrenching these quarterly sessions
going forward and trust that by so doing, members will remain informed and
engaged in the business.
During the year, the Board, supported by the Supervisory Committee,
sustained its focus on governance matters. Although there were no Board
member related issues noted, the organization identified various staff related
matters that led to separation with three senior members of staff through
disciplinary processes and voluntary resignations. We also witnessed
resignations from various staff who struggled to adjust following
re-organisation efforts carried out during the year. Continued collaboration
between the two arms of the Board (as noted in Supervisory Committee’s
update in page 26 of this report) have gone a long way in identifying and
addressing these governance issues. In addition, we continue to strengthen
the Internal Audit office that monitors and reports on the organization's
adherence to set guidelines and policies.
The organization currently has 11 active court cases largely relating to
contractual disagreements with one being on allegation of wrongful dismissal.
We also have one case under arbitration regarding breach of contract by one
of our conveyancing service providers. In the year 2021, SIC concluded 2 court
cases where one was ruled in favour of and the other against the organization.
The organization also instituted 8 investigations with the Department of
Criminal Investigations (DCI). In 2021, one of the matters handled by DCI was
resolved with title release to the organization while a cash recovery agreement
was reached on another.
During the year, we finalized the ERP project that commenced in 2020. The
long delays were occasioned by data challenges in the previous system

Chairperson’s Report
compounded by the requirements to have IFRS 15 compliant

data in the new system from the onset. I am glad to report that
we are now fully live on the new system, a feat which would not
have been possible without the great dedication of the project
team comprising of our staff, the system vendor and the Board’s
ERP steering Committee. We expect to reap the full benefits of
this system from the year 2022 as we release all the features and
capabilities to the staff, clients and members.
Noting all of the above, the Board and Management are bullish
on the opportunities available even as we continuously monitor
key macroeconomic developments in our country and around
the world. We remain conscious that the COVID-19 pandemic is Figure 1: A worker monitoring the 3D printing process
not over and that various sectors of the Kenyan and Global
economies are still suppressed. We foresee further return to
normalcy across the world and in Kenya in the year 2022.
Additionally, we note the rising political climate in the country
and anticipate increased investor anxiety historically associated
with the Kenyan electioneering period. The Board is optimistic
that the plans and mitigations we have in place will lock-in our
projected business performance and safeguard returns to our
investors for the year 2022.
Key Macro-economic Developments and Outlook

Notwithstanding the weight of the pandemic in 2021, various key Figure 2: The completed 3D printed house
developments were registered in the Kenyan real estate sector,
most of them driven by government activities including: by the weakening of the shilling against the dollar.
The launch of Ardhisasa digital land registration platform by
the Ministry of Lands Overall, the real estate sector was on a recovery path in 2021.
This is a trend we expect to continue in 2022 driven heavily by
Implementation of the Sectional Properties Act affecting
new realities as a consequence of the COVID-19 pandemic as
apartments and registered gated communities
well as continued government investments in infrastructure.
Unveiling of the Lamu Port (which will be the largest These include:
deep-water port in Sub-Saharan Africa upon its completion)
Peace of mind associated with owning your home. Many
Rehabilitation of Mamboleo-Miwani-Muhoroni road in Kenyans are now shifting to home ownership due to the
Kisumu uncertainties associated with paying rent and absorbing
Granting of City Status to Nakuru town rental increments solely determined by the landlords.
Commencement of Nakuru International Airport Search for homes with compounds and big enough
construction spaces to support working from home (home offices).
Progression of the Western bypass dual carriage way going Reduction of business spend on offices to cushion them
through Ruaka will see more pressure on commercial spaces as many
Gazetting of the Nairobi Express Way businesses adopt hybrid ways of working.
Launch of the first ever D-Reit at the Nairobi Securities Shift in holiday stays from hotels to Airbnb (or similar
Exchange by Acorn Holdings Limited services) where bookings are estimated to have grown by
as much as 68% in 2021.
The above and many other government infrastructure activities
have opened up the various areas for development and have Demand for land driven by sustained urbanization at 4.1%
given a boost to the real estate sector. in Kenya compared to the global rate of 1.8%.
Availability of financing to home owners directly through
Technology adoption in the Kenyan real estate sector has
banks and SACCOs and indirectly through the Kenya
continued, notably with the launch of the first 3D printed house
Mortgage Refinancing Company (KMRC) which has now
in December 2021 at Bamburi Cement’s premises in Athi River.
reviewed terms to allow mortgages up to the tune of Kshs.
On the macroeconomic downside, there was a major decline in 10m.
building approvals as investors shied away from initiating new Finalization of key government infrastructure projects
projects. Retail, commercial and prime residential rental rates across the country.
continued on a decline. This period also saw the Kenyan shilling
depreciate by about 8% to the dollar affecting prices of imports. An overview of the business performance in
The largest impact was felt in fuel prices that have risen to year 2021
historical highs on account of increased global crude oil prices as
well as the weakening shilling. You will note that Consumer Price The Board focused on business performance across various
Index (CPI) inflation went up in the year reaching a high of 6.91% metrics noted below. The detailed information can be found
in September 2021 compared to 5.69% in January 2021. This put in the Treasurer’s update that starts at page 13 of this report.
more pressure on disposable incomes for many families and
affected their appetite for discretionary spend such as making
investments. Globally, steel, a key input in the construction and
manufacturing sectors, saw an over 50% growth in prices due to
increased demand. This was exacerbated in the Kenyan market
https://www.lafarge.co.ke/14-trees-announces-africas-largest-3d-printed-affordable-housin
g-project-kenya

Growing membership
We added 226 members in the year compared to
193 members the previous year.
Shares trading
The secondary market slowed down with only
208,323 shares sold during the year compared to
651,753 the previous year.
Financial performance
Both the gross sales and the gross surplus more
than doubled growing to Kshs. 973.2m up from Kshs.
437.9m and Kshs. 396.2m up from Kshs. 187.4m
respectively. Our operating expenses grew by a
modest 18% to Kshs. 200.6m from Kshs. 169.8m in
2020 yielding a net surplus before rebates of Kshs. Figure 4: Assets and share capital trend graph
195.7m compared Kshs. 17.6m the previous year.
Cash-flows remained strong with receipts from
customers exceeding Kshs. 1b compared to Kshs. Good momentum in 2021 paving the way for a
456.5m in 2020
bright future
Title processing
Although we continued experiencing challenges at Riding on the momentum from 2021, the Board will focus on the
the various registries, we were able to process 1,938 following thematic areas outside of normal business
titles in the year compared to 1,573 titles in the performance:
previous year.
Finalizing the re-organisation, business model review and 3
year strategy – The actions taken to set the organization on a
2021 business performance in context of previous new growth trajectory in 2021 have began bearing fruits as
performance exemplified by the 2021 business performance. The Board will
progress these corrective actions with an intention to finalize
SIC continues to accelerate across all business indicators:
the organization redesign, business model review and
conclusion of the three year strategic plan. As previously
indicated during member forums, the Board will continuously
share the strategic plan with members as the process
progresses.
Titles – the number of titles
issued increased dramatically Finalization of the Ibuka and USP process – During the year,
Members – have a
to 4,178 from 2,240 last year
while total units fully paid for
the Board approved participation of SIC in the Unquoted
total of 4,890 having
added 226 members
increased to 6942 from 5,542 Securities Platform (USP) by the Nairobi Securities Exchange
last year. The percentage of
in 2021 total issued titles against (NSE). This process includes making an application to the
total fully paid for plots NSE for their evaluation. The Board elected to submit the USP
increased from 40.42% in
2020 to 60.18% in 2021. application after rolling out the new ERP system and upon
finalization of the 2021 financial accounts. We anticipate that
the process, including audits and reviews may take anywhere
Turnover –our Rebates to members – the
between six and nine months at which time the Board will
cumulative gross Board proposes to pay Kshs. determine the next course of action and update the
revenue since 117.4m in rebates for the year
inception grew 36% 2021 which will grow total members.
year-on-year to Kshs. rebates paid since inception
3.7b occasioned by
the strong
to Kshs. 2.12b. Rebates paid Finalization of phase 1 of the new housing project –
in the year will be Kshs. 1.45
performance in 2021. per share compared to Kshs. Although we didn’t achieve our target to commence building
0.15 in the previous period.
the Miran housing project in 2021, you will note from the Real
Estate Committee update on page 21 that various preliminary
activities were carried out including selection of the project
manager and contractor. Key among the decisions made by
the Board was carrying out the project in a phased manner to
limit exposure and risk to the organization. We anticipate
external project communications starting very soon to
confirm demand ahead of ground breaking expected in the
first half of the year. I encourage all of us to take up units in
this serene project either to earn rental income or to occupy
as a home.
Close out on pre-2017 (historical projects) – Out of 152
projects initiated to date, 19 remain in the list of historical
projects we need to resolve. The HPL Committee made great
strides in the year as noted in their update on page 24. The
team and the Board are keen to carry on the great work with a
target of closing 90% of these projects in 2022.
Enhancing the brand – From the year 2020, we have been
positioning SIC as a thought leader in the investment and real
estate sector. We build upon this in 2021 through aggressive
Figure 3: Financial performance trend graph

advertising (prime time TV and radio, bill Boards, social Rebates, bonus and honoraria
5.
media and influencers) covering both product and brand.
The Board:
We continue to leverage both paid and owned media to
drive up brand affinity and recognition which in turn drives 5. Proposes that the Society pays out rebates of Kshs. 117.4
up customer loyalty and demand for our projects. We will million (being 60% of surplus) for the year ended 31st
double down on both thematic and product December 2021; translating to Kshs. 1.45 per share.
communications in 2022 to further consolidate our gains in
positioning the brand. We are conscious, however, of the 6. Proposes to award a performance based staff bonus
lurking danger to our brand emanating from the HPL payout of Kshs. 7.9 million for the year 2021.
projects and will remain vigilant at attempting to resolve
7. Proposes a honoraria payout of Kshs. 5 million to the Board
them while managing negative brand sentiments that may members for the year 2021
arise.
Share trading under USP
Aggressive membership drive – With the USP listing in
sight, we are gearing the organization for a significant The Board:
growth in membership. Even though the primary goal is to
increase the number of active members, we anticipate that 8. Proposes that the Shareholders grant the Central
these new members will invigorate share trading in the Management Committee approval to execute all
secondary market as they anticipate releasing their shares requirements towards aligning with the Unquoted
once trading is possible at the Nairobi Securities Exchange. Securities Platform (USP) Processes.
We project that a membership of at least 6,800 members Corrections and amendments of by-laws
should provide a solid base for our USP listing. We
therefore target to enroll an ambitious 2,000 additional 9. Proposes various corrections and amendments to
members during the year. Society’s by laws. (The list of these amendments has been
shared seperately with this report and will be presented in
Doubling down on cost Management and optimization – detail to members during the AGM).
As we enhance our business model, we have noted an
increase in various costs, most of which are associated with If any member has a clarification, comment or counter
the cost of goods sold (COGS). We have identified that proposal on the resolutions above, kindly make your
these costs are between 50% and 65% of our gross sales. submissions to the Honorary Secretary of the Board by 10 am
Although the large percentage of these are the cost of (East African Time) on Friday, 4th February 2022 via
land, we have the opportunity to optimise on our spending info@sic.co.ke. Make sure to include your full name and
in value addition without destroying the value we promise member number in your clarification request, comment or
to deliver under our new business model. The Board and counter proposal. Any questions received after this time will
Management team will therefore spend more time be collated and responded in a circular by the Honorary
identifying cost optimization opportunities and by so doing Secretary after the AGM.
enhance our bottom line.
Concluding remarks
AOBs raised in the last AGM
As I conclude, may I reiterate that the organizational reforms
No AOBs were raised during the 12th AGM. undertaken by the Board and Management team are yielding
results. This is evidenced by many firsts in SIC’s history
Proposed resolutions for the upcoming 13th (highest gross revenue, highest gross revenue to share capital
AGM ratio, highest cash-flows from sales activities and highest
total assets). We also remain heavily focused in attaining our
The Board proposes the resolutions below for ratification and
vision of being the Investment Partner of Choice in East
adoption at the upcoming 13th AGM scheduled for 5th
Africa.
February 2022, if the sitting so agrees.
May I also take this opportunity to thank all our stakeholders:
Routine resolutions
our clients, our members, the Cooperatives Department, our
1. Recommends appointment of Ronald’s & Associates LLP Management and staff, our various business partners and my
as the Independent Auditor for the year 2022 being their fellow members of the Board for ensuring the organization
second year of service. continues getting stronger. Let’s Go Beyond!
2. Proposes that Board members indemnity be retained at

Kshs. 3 million per person..
3. Proposes that the borrowing ceiling for the Society be

retained at Kshs. 3 billion. Peter Gichangi
Chairperson
4. Proposes that monthly contributions be used to purchase
shares in the secondary market by default unless one
wishes to have the funds invested in the Interest Earning
Deposit (“IED”) which will earn an annual interest of 5% with
both the deposits and interest payable to members two
years from 1st March 2022

Treasurer’s
Report
Overview of the Year
The effects of Covid-19 continued to weigh down the Kenyan economy in the
just ended financial year although recovery was evident as the government
continued to ease restrictions put in place to combat the effects of the
pandemic.
Central Bank of Kenya recent report indicates that GDP grew by 8% in 2021.
Inflation rates closed the year at 5.6% well below the Central Bank of Kenya
upper target range of 7.5%.
The Kenya Shilling was under pressure during the year due to reduced foreign
exchange inflows from exports with exchange rate to the US dollar
depreciating by close to 8%.
The roll-back by the government of Covid tax relief measures, the growing
unemployment rate and slow recovery across the economic sectors reduced
overall purchasing power of consumers in the year.
Faced with these tough challenges during the financial year, our business
demonstrated resilience which enabled strong performance in 2021.
Financial Performance Highlights

Vincent Opiyo 1. Revenues
Sale of land remains our main source of revenue accounting for close to 90%
of overall revenues. Land revenues grew by 173% to Kshs 868.5m compared
to Kshs 317.8m reported last year largely driven by efficiency created in the
land sourcing process that ensured timely issuance of title deeds to our
members. The customer survey we conducted at the beginning of the year to
gauge locations of interest to our buyers also helped in ensuring we only
acquired suitable land. The process of unlocking challenges with the historical
land inventory is progressing albeit at a slow pace and I wish to commend the
HPL Committee for helping avail these lands for sale (refer to HPL report on
page 23)
Housing revenues declined by 38% to close the year at Kshs 75.3m compared
to Kshs 122.1m in the previous year. The decline is attributed to the fact that
we didn’t have any new housing inventory and focused on clearing
outstanding stock in Bluebells, Ruaka and Kantafu. The unsold housing units
now stands at 20.
In the year, we reported 80% growth in revenues from Zaria partnership of
Kshs 23.4m from 12.9m in 2020. Only 76 units have so far met revenue
recognition criteria.
In line with IFRS 15 requirements, your Co-operative has endeavored to
improve processes from land acquisition to issuance of title deeds to
members in order to ensure that significant portion of deferred revenues is
2019
202
0
2021
200m 400m 600m 800m 1000m 1200m 1400m
Revenue from Housing Projects Revenue from Land Projects

Treasurer’s Report
recognized within the financial year. We also closely monitored the cost of sales which is currently 60% of revenues with a view to
bringing it lower through negotiating land acquisition cost and related conveyancing expenses.
2. Expenses
To finance the growth in the year, the total expenses for the year rose to Kshs 200m from Kshs 169.8m representing 18% year on year
growth. The growth was mainly driven by accrued interest on members interest earning deposits (IED) of Kshs 28.9m and bank loan
interest of Kshs 14.8m both of which were not in the previous year financial statements. Professional and legal fees also grew from
Kshs 9.1m to Kshs 20.7m due to engagement of a consultant to refresh our strategy as well as legal cases we had to defend.
2019 2020 2021 2019 2020 2021

Administration Governance
14,663 19,481 20,185 9,734 9,949 11,125
2019 2020 2021 2019 2020 2021

Personnel Business
Development
62,773 66,918 76,886 31,570 18,539 15,247
2019 2020 2021 Provision for 2019 2020 2021

Financial Prior Year
Projects(HPL)
2,385 1,579 46,915 18,300 42,049 5,026
2019 2020 2021 2019 2020 2021

Professional Depreciation/
Amortisation
2.547 9,134 21,345 2,509 2,142 3,878
2019 144,482.63 2020 169,791.50 2021 200,607.99
3. Operating Profits
In the just ended financial year, operating profits registered impressive growth from Kshs 17.6m in 2020 to Kshs 195.7m in the current
period. The growth in profits was driven by a combination of healthy topline growth and focus on cost efficiencies.
4. Members rebates
Our strong financial performance in the year has enabled us to propose rebates of Kshs 117.4m to our members for the period ended
31st December 2021 which represents significant improvement from Kshs 12.1m declared in the previous year. Once approved at the
AGM, the rebates will be distributed to members within the month of February 2022.
5. Balance Sheet and Cash-flows
In order to position our Co-operative for future opportunities, we have continued to focus on activities that strengthen our balance
sheet and during the year, total assets grew to Kshs 5.2b representing 7% growth over the previous year. Our cash-flows also
improved in the year as evidenced by growth in cash and cash equivalents to Kshs 172.5m compared to Kshs 151.8m last year.
Net Net Cash and

Cash Flows cash-flow cash from cash equivalent
from operating from investing financing at the end of
activities activities activities the year
2021 78.27m 39.2m 125.64m 172.5m
2020 31.92m (86.57)m 351.25m 151.8m

Treasurer’s Report
6. Debt recovery
Our trade receivables reduced by 22% from Kshs 1.2b in the previous year to close at Kshs 961m as the recovery efforts bore
fruit.
7. Reserves
I wish to draw our members attention to our reserves that improved by 47% from negative Kshs 101.4m in 2020 to close at Kshs
53.8m. This represents our arsenal to deploy for investments and we shall continue to build it as our net earnings improve.
8. Statistical Highlights
Year 2015 2016 2017 2018 2019 2020 2021

Gross profit ('000') 379,953 474,684 533,293 525,273 55,945 187,440 396,280
PBT(‘000) 337,076 413,501 446,305 395,356 -88,537 17,648 195,671
Rebates Pay-out ( 000) 322,500 392,000 420,000 375,000 0* 12,131 117,403
Rebates Rate 25.0% 21.0% 18.0% 15.0% 0.0% 0.49% 4.69%
Total Assets (million) 2,238 3,337 3,852 3,938 4,876 4,840 5,158
No. of Members 3,188 3,847 4140 4,345 4,345 4,644 4,890
Share Capital (Million) 1,289 1,867 2,220 2,501 2,501 2,501 2,504
Value Per Share 350 435 525 525 52.5 52.5 52.5
ROC 26% 22% 19% 15% -4% 0.2% 3%
Return On Assets 15% 12% 14% 10% -2% 0.1% 2%
Table1.0
9. Membership analysis
Membership Categories
10. Budget
The budget for 2022 and 2023 is presented on page 46. This budget takes into account the aggressive growth assumptions as
contained in our 3-year strategic plan. Delivery of this budget will be supported by the new organization design and business
model which are the outcomes of the strategy refresh done during the year.
Conclusion
As the global economies recover from the negative effects of Covid-19, we are confident that Kenya’s economic outlook will
equally improve and this will provide us with a conducive environment to deliver on our strategy that will guarantee better returns
to our members. I wish to encourage our members to continue being good ambassadors for our brand including patronizing our
products.
Finally, I thank our members, customers, fellow Board members, our staff and various stakeholders whose positive contribution
continue to guarantee our growth.
Vincent Opiyo
Treasurer

Business Development
Committee Report 2021
Overview
The Business Development Sub-committee is mandated with championing new
business growth by developing a robust strategy for expanding revenue streams
that will enable business growth through diversification and penetrating new
markets and delivering new business pipelines, from across various sectors.
The COVID-19 pandemic has had severe impact on the Kenyan economy and
society as a whole. According to the nationally representative business Pulse
Survey implemented by the World Bank between June and August 2020 on the
impact of COVID-19 on businesses in Kenya, about 93 percent of firms experi-
enced a decline of sales compared to the same period of the previous year. Sales
dropped by around 50 percent in the average and median Kenyan firms, and by
more than 70 percent for one-quarter of firms. This impact was across all sectors
and greatly impacted our entry into new sectors.
The major project handled by Business Development in the year 2021 was the
Zaria Village. This is a joint venture partnership between Safaricom investment
Co-operative (SIC) and Palm Ridge Limited. Zaria is master-planned gated
family-oriented community undertaken on a 120-acre parcel and features 331 ¼
acre serviced plots available for sale, a mini shopping complex, a school, a
clubhouse, swimming pool, dam (Lake Zaad) and a recreational area. Infrastruc-
ture comprises cabro-paved internal roads, a stone perimeter security wall, solar
street lighting, electricity, boreholes and water reticulation facilities as well as
provisions for supply of Internet Fibre. Investors in the project also have access to
4 pre-approved house designs. Zaria is located about 25 km from the central Agnes Marete
business district, off the Ruiru-Kiambu bypass in the vicinity of Tatu city.
In 2021, our major areas of focus regarding Zaria were the delivery of infrastructure
works and sale of units. To date, the project has sold 195 units, 67 units have been estate business.
fully paid for and infrastructure works now stand at 81% completion. These
developments have accelerated sales and payments by the customers for their Having established the foundation for the property
units. In addition, some clients completed building and have already moved into Management business, business development will
their houses as frontier members of the community. aggressively push to on-board clients in 2022. SIC
will leverage on its industry contacts in the Real
SIC ventured into the property Management space in the financial year 2021, by Estate industry, its reputation and infrastructure to
registering a subsidiary named SIC Products Limited. The company is registered deliver sales in this area.
under the company Act in Kenya and offers property Management, security and
cleaning services. This move was informed by the growth in development of malls On the education front, SIC is in the early stages of
and high-rise buildings in upmarket places in Nairobi and satellite towns like exploring a partnership with an investor in that
Mlolongo, Kitengela, Ngong and Kiserian. The firm is focused on delivering high sector. This is expected to be a long-term project
quality and customized services for gated communities, flats, malls and for public which will allow for generation of sustainable and
institutions. The company has received necessary regulatory approvals from the ongoing revenues for the organization once
Estate Agents Registration Board and is actively onBoarding new clients. delivered. The potential partners and SIC are keen
on pursuing this opportunity and will engage in the
In the year, Business Development continued the delivery of an agency selling first half of the year to lay the groundwork.
project on-boarded earlier.. This project comprised of SIC leveraging its superior
sales and marketing capabilities to sell a project on behalf of an investor in Business Development will continue to pursue
exchange for commissions. This model is still in infancy and we continue to pick agency selling opportunities. Investors in the Real
lessons that can be used in delivering in this space as well as in the primary Real Estate industry have expressed keen interest in
Estate business. working with SIC to assist in selling their products.
This presents an opportunity to boost our income
In order to enhance the capacity of Management to propel the business develop- and create long term partnerships that may result
ment portfolio, the Board recruited an investment manager and a housing manag- in future business opportunities. SIC is currently in
er in the last quarter of 2021. The managers will work with the rest of the team to talks with some property owners who are interest-
scan the business environment for new business ideas coming up in the market- ed in pursuing this model of working and we expect
place. These senior executives are well experienced in the areas of investment and to deliver the associated revenues within the year.
business development and are expected to reinvigorate and diversify the portfolio
of the organization. SIC will also continue to explore other opportuni-
ties in various sectors. The business development
Overall, the activities of the Committee contributed approximately KES. 35 million team invites members to contribute new ideas
to SIC’s topline within the year 2021. The Committee expects to accelerate its that may lead to viable business opportunities. We
contributions to the organization in the year 2022. are keen to hear from our members. You can drop
Looking Ahead your ideas in our new business portal info@sic.-
co.ke or visit our team at Westom Point Building,
In line with our strategic plan, 2018-2022, SIC aspires to diversify its investment
Westlands
portfolio to reduce the concentration risk associated with our traditional real

Business Development Project

Business Development Committee Report 2021
Introduction to Zaria village

The development features 331 ¼ acre serviced plots available for sale, a mini shopping complex, a school, a
clubhouse and a recreational area. Located about 25 km from the central business district, off the Ruiru-Kiam-
bu bypass. It is a joint venture partnership between Safaricom investment cooperative (SIC) and Palm ridge
limited.
The project is a controlled development with pre-approved modern house designs among which the buyers
can select from, some of our buyers are currently constructing their homes. The project infrastructure works
are at advanced stage, with 81% scope executed
Project amenities:
2 Recreational Areas, by the river and
Well-designed stone perimeter wall by the Lake Zaad
Internal Cabro roads 4 options of scalable house designs
Provision for an education center

Provision for a Mini Shopping Complex
Solar Street Lighting Clubhouse, gym and restaurant
Jogging Track 25m Swimming pool with Kiddy Pool
Payment plan
The following discounts will be applicable for the aforementioned period for the clients who commits within
this period.
payment payment 6 months 1 year

within 5% off within 2% off payment
interest payment
6 months interest free
6 months 1% interest
30 days purchase price 60 days purchase price plan free plan
The developer has partnered with following banks NCBA, STANBIC, KCB for mortgages financing to
prospective buyers.

Business Development Committee Report 2021
Property Management 3. Service Charge Management
SIC Products Limited is a subsidiary of Safaricom Investment
The cost of facilitating common area services is charged to the
cooperative. The society is registered under the society act of
property owner through the Service Charge levy. We facilitate
Kenya and offers all services of Property Management, security
the creation of annual budget estimate for allocation of all
and cleaning services. The firm is focused on delivering high
expenses expected for the common areas. This forms the basis
quality and customized services to individuals, the private
on which the service charge is derived.
sector and the public.
SIC products limited applies her exemplary services to ensure
Today SIC has made its presence strongly felt in the Kenyan
that the residents live in habitable and conducive environment.
property and real estate industry. The society can confidently
We give value for the service charge, which enhances the
declare itself an upcoming market leader in this sector including
payment of rent. We manage defaulting tenants and minimize
property Management services.
any liability exposure on the property owner.
Safaricom Products limited is currently undertaking property
We manage recruitment of new and on-going service providers’
Management of varied big residential and commercial
contracts to ensure efficiency and consistent quality services at
development projects and remains the ultimate choice for any
the optimal costs. We engage landlords for their recommenda-
discerning property owner and investor.
tions and feedback and implement the same.
Service Proficiency Our Revolutionary
SIC products Limited has specialized knowledge and
Technology Integration
experience in the area of property Management, letting and
marketing. She has very skilled workforce of Management with Our Property Management technology integration solution
highly motivated and multi-disciplined professional staff that ensures all clients handled by our team are documented in a
ensures delivery of quality services in property Management, transparent and efficient way. Reports to the owners is also only
letting and selling of both residential and commercial a click away. All marketing collateral are easy to email to the
properties. client, therefore the turnaround time from inquiry to sale is
minimized. The vacant units are seamlessly listed on the
Our state of the art cloud based property Management system
website where new clients easily reserve units, make payment
makes SIC products limited the ultimate property Management
and signing a lease. The system then seamlessly transitions
and marketing society for the wise property developers and
them to tenants. This gives us a competitive advantage in
homeowners.
tenants’ acquisition.
Services offered by SIC products Limited All the properties we manage are tracked on an online portal
1. Common Area Management Services that is accessible to both the tenants and property owners via
the web or smart phone. This secure system provides the
Safaricom Investment Co-operative has competence in following services from the convenience of smart phone;
property Management and common area Management.
Supervision of maintenance of common areas and amenities. 01 02 03
Administration and collection of service charge.
Sends
Files all tenant Tracks
payment
documents. payments.
Negotiation and appointment of service providers. reminders.
Preparation of monthly update and annual financial reports.
Supervision of cleaning of common areas, Garbage & Sanitary disposal.
Supervision of security service providers.
Consultancy services on property Management. Generates

Tracks service Invoices
orders. reports for us &
tenants.
Supervision of Plants and flower maintenance and landscaping the landlords.
04 05 06
2. Tenants Management
Safaricom Investment Co-operative provides the following
services in tenant Management;
Rent collection.
Leases preparation and Management. Agnes Marete

Letting out of units. Chairperson
Vetting of new tenants. Business Development Committee
Termination and ejection of defaulting tenants.
Rent deposits Management.
Restoring vacated units for the next tenant.
Service Charge Management

Real Estate
Committee
Report 2021
1. Overview
The Real Estate Committee is pleased to present its report for the year 2021.
This Committee is mandated with identification, acquisition, development
and sale of Land and Housing projects. Despite the continued effects of the
Covid-19 Pandemic into 2021 that were mostly characterized by the diminish-
ing disposable income by a majority of Kenyans as a result of loss of
livelihoods, the Real Estate sector experienced increased demand in satellite
towns such as Ngong, Mavoko, Kiambu and Kitengela as more people sought
to purchase affordable land within a reasonable distance from Nairobi. This
suggests that investors still consider land as a good investment in the long
term despite the prevailing economic conditions. SIC leveraged on this
background and purchased the 2021 land projects in these satellite towns
and was able to record remarkable achievement in sales.
Further, SIC on-boarded a budget project next to Ol Pejeta conservancy in
Nanyuki that saw a record 800 units on-boarded in four phases and were sold
out in just 3 months. This was a very commendable performance and going
forward the budget projects will continue to be a key feature in the land
Eng. Emily Kilongi purchases.
On the housing front, the already constructed housing units continued to
have slow traction in sales largely affected by the prevailing economic condi-
tions that were negatively affected by the Covid 19 Pandemic. This resulted in
a few units still remaining unsold by the close of the year. However, an oppor-
tunity also presented itself out of this whereby it was noted that Kenyans still
desired home ownership but at affordable prices and within easy reach to
Nairobi City. SIC thus continued with preparations to launch a new housing
development for members and investors to be located in Ruaka and
construction is targeted to commence by 2nd quarter of 2022.
Through collective efforts by the Board, Management and staff, SIC managed
to successfully deliver a gross revenue of Kes 943.9m in 2021 on Land and
housing projects.
2. Operating Environment in 2021

Despite the effects of Covid-19 pandemic on the economy, SIC continued to
ensure that it remains relevant in the real estate space by sourcing for market
driven products and employing aggressive marketing strategies as well as
improving on the overall customer experience. Efforts were made towards
streamlining land acquisition processes by ensuring thorough due diligence is
undertaken while at the same time fast tracking the onBoarding process for
the purchased land. Similarly, the titling processes was restructured to
ensure a shorter turnaround time of about sixty days for customers to get
their title deeds after full payment is done and all transfer documents have
been signed.

Real Estate Committee Report 2021
There were however various challenges as well as opportunities that affected operating environment as shown below;
2.1 Challenges
The main challenges that SIC faced during the year included:
Reduced disposable income for Reduced funding to the sector

01 many people as a result of loss of 03 from financial institutions due to
05 Lengthy due diligence processes
livelihood which was a threat in risk aversion as a result of the in some instances in order to
terms of available customers to Covid-19 Pandemic. avert the risk of fraud by potential
consume our products. vendors.
Slowdown in collections from Slow operations at the Land registries

customers who had paid deposits on and in some instances, total closure of
various products and had balances the registries for considerable period
to complete. This affected cash of time leading to slow progress in
02 inflows for SIC. 04 titling processes.
2.2 Opportunities
Despite the challenging environment, SIC leveraged on several opportunities such as;
Leveraging on technology to connect with Improvement of land acquisition and titling

customers within the country and in the diaspora internal processes with an aim to shorten the period
digitally, therefore reaching a wider group of of land acquisition and time of issuing titles to buyers
potential customers. while at the same time making the processes more
efficient.
Leveraging on the environment created by the Undertaking market surveys to ensure all
Government for implementation of Affordable products being acquired by SIC are based on
Housing projects under the Big 4 Agenda. market demand.
3. Real Estate Performance in 2021

The real estate Committee focused on three key areas during the year 2021;
Land projects (ongoing & new)
Ongoing housing projects
Affordable housing project.
3.1 Land Projects The performance was commendable considering the operating
environment during the Covid-19 Pandemic. Sale of the remain-
In 2021, SIC successfully on-boarded 7 new land projects to ing units will be completed during the first quarter of 2022.
complement the already running projects. The title deeds for all
the new parcels of land are in SIC name. This is in line with SIC On the older land stock, in 2021 we offered our products to 10
commitment to ensure that transfer processes to buyers are counties including; Kilifi, Machakos, Kajiado, Kisumu, Makueni,
faster and more efficient when the mother title is already in SIC Kiambu, Uasin gishu, Laikipia, Narok and Siaya counties. This
name at the point of sale. focus ensured that we have adequate reach of our Products to
all our customers in their specific areas of interest. As we look
The performance of some of the new projects is indicated forward to 2022, SIC will on-board new products in areas that
below; have high demand such as Kisumu, Nakuru, Kiambu, Laikipia,
100%
Nyandarua and Trans Nzoia Counties.
Phase 1 - 4 | 800 Units
On titling processes, in 2021, SIC processed a total of 1,938 title
deeds of which 1,064 were transferred to buyers’ names and 874
100% were in SIC name. This was an improvement from 2020 perfor-
36 Units
mance whereby SIC processed a total of 1,573 titles of which 856
were transferred to buyers’ names and 717 were in SIC name.
This was a great achievement in light of difficulties encountered
78%
67 Units | 15 Remaining at the land registries which were operating with reduced staff
due to the Covid-19 pandemic and in some instances, closure of
the registries. SIC team put in immense effort to ensure that we
meet our customer’s expectations.
79%
105 Units | 22 Remaining
74%

Real Estate Committee Report 2021
3.2 Ongoing Housing Projects Future focus
Sale of the already constructed housing units continued into Our focus for 2022 is as shown below;
2021 and though sales have been slow especially having been To enhance market research in order to deliver land
impacted by the effects of the Covid-19 pandemic, the remain- products that have clear demand.
ing units are few and are expected to be cleared in 2022. The
performance of the housing units is as shown below: On-board the land projects early in the year in Q1 to
ensure there is adequate time for sales to be
89% completed within the year and recognize the income.
Fast track the titling processes in order to promptly

deliver title deeds for buyers who have finished their
obligations within reasonable timeline of sixty days.
97%
Engage other players in the real estate space to
identify areas of partnering.
77%
KANTAFU 22 Units | 5 Remaining
HOUSES Set up a housing unit to fully focus on the housing arm of
the SIC and provide different housing products to members
for both home ownership and investment purposes.
3.3 Affordable Housing Project
In 2021, SIC continued with the planning for construction of a To leverage on current trends and technologies and
master planned urban community in Ruaka on a 3.5-acre piece ensure SIC remains relevant, competitive in the market
and the investor of choice.
of land. This development is in line with the Government’s Big 4
Agenda on Affordable Housing. Construction of the first phase
consisting of 210 units is scheduled to commence within the Enhance the customer experience by being
responsive to all customer concerns.
second quarter of 2022. The modern apartments will consist of
a mix of studio, studio loft, one bedroom and two-bedroom We commit to continue providing prompt, frequent, targeted
units. The facilities will include; manicured lawns, children and project-based updates to our customers through the
playground, rooftop terrace and play courts. Designs have been quarterly member forums. Please direct any queries on the
completed, procurement of the contractor has been completed products that you have patronized to info@sic.co.ke
and pre-sales are expected to commence by February 2022. The
construction period is estimated to take 15 months. As the Real Estate Committee, our promise continues to be
providing Quality, Affordability and Value for money for our
Ruaka is one of the fastest-growing neighbourhoods around customers and better returns for our investors.
Nairobi and is only 30-minute drive from the CBD via both
Redhill Road and Limuru Road. The site lies in close proximity to Thank You,
shopping malls such as Two Rivers Mall and Village Market. The
adjacent suburbs of Runda and Rosslyn also make the location
quite secure and attractive for investors. Major hospitals within
the vicinity include Gertrude’s Hospital and Aga-Khan Hospital.
Eng. Emily Kilongi
Members are highly encouraged to invest in this SIC flagship Chairperson
project.
Real Estate Committee

Report of the
Historical Problematic
Lands (HPL)
Committee 2021
1. Mandate
Safaricom Investment Co-operative (SIC) has enjoyed a long history of
prosperity arising from its ability to identify and deliver profitable investment
opportunities for its members and customers. However, some of the projects
that were implemented in the past experienced delays in closure. In a bid to
resolve these historical challenges, the Annual General Meeting in February
2020 adopted a recommendation by the Board for the creation of a task-force
dedicated towards the resolution of historical issues impacting SIC projects.
The creation of the task-force, dubbed HPL, allowed the Real Estate and
Business Development sub Committees to focus on delivering the traditional
real estate business and new business opportunities respectively. HPL was
mandated to identify past projects that were facing difficulties and to devise
ways of resolving those issues.
The key objectives of the task-force were:
Edward Njoroge Expedite the delivery of titles to customers
Secure the ownership of SIC assets.
Recovery of any funds or assets at risk of loss.
The benefits expected from these activities were:
Restoration and boosting customer confidence resulting in repeat business
and increased sales
Foster collection of debts owed to SIC by delivering on the organization’s
contractual obligations to its customers.
Properly supported ownership of assets would enhance the business’s
ability to access funding to take advantage of emerging investment
opportunities.
The HPL Committee is pleased to present its report for the year 2021.
2. Key achievements
Our key objective has remained the resolution of issues impacting customers
premised on the belief that restoration of their confidence in our organization
remains a key driver to the future financial success of SIC. This has been demon-
strated by the fact that following the resolution of some of the problematic
projects, the customers affected have become the organization’s biggest
advocates and ambassadors leading to increased sales. Referrals remain our
biggest contributors to sales and therefore it is crucial that promises made, and
obligations owed to existing and past customers are met.
Having closed on the projects that were facing straightforward issues in 2020,
HPL then embarked on dealing with the challenges that were relatively more
complicated. Overall, HPL focused on two fronts in 2021.
Meeting the Co-operative’s obligations to the customers through the
delivery of titles or relocation to alternative properties.
Securing the ownership of SIC assets

Report of the Historical Problematic Lands (HPL) Committee 2021
With the support of the Board and all staff, the task-force was able to
deliver the following key achievements in the year: Heightened positive sentiment towards the organization
evidenced by increased sales.
Recovery of some of the organization’s assets through legal
proceedings.
Safeguarded KES Contracting of competent legal professionals and service
166m in revenue
from loss by securing
providers to assist in the delivery of the initiatives by the
titles to 7 large task-force.
projects impacting
482 customers. Termination of service providers whose negligence or willful
involvement led to the historical challenges.
Relocation of
customers from Successfully
projects that require defended a legal suit 4. Looking ahead
longer-term action to subsequently
resolve, resulting in preventing payment of In 2021, we laid the groundwork to tackle the last group of
reduction of cash-flow unwarranted fees. projects that were in scope for HPL. We addressed customer
exposure by KES disaffection by delivering titles where projects were closed and
124M.
relocating customers to other projects where longer-term action
Agreed a was required to avoid inconveniencing them.
process for
restitution and In addition, a road-map for projects closure was agreed by the
relocation of customers team and relevant service providers engaged to deal with each
impacted by the largest
project being handled project. The plan for 2022 is to execute the actions delineated in
by the task-force. the agreed road-map for each project. These will include:
1
Speedy processing of subtitles for
customers for all parcels where the
3. Delivery mother titles have been secured.
HPL continued to utilize a risk-based root-cause analysis
approach in addressing the challenges facing projects. The
Committee agreed priorities with Management and tracked the Execution of settlements agreed
2
completion of actions as defined and agreed on by the with customers especially the quick
task-force. delivery of titles for parcels selected
for relocation.
As part of the efforts towards meeting its objectives, the
task-force engaged various stakeholders in the course of the
year. These included customers, members, government Pursuit of legal proceedings to secure
3
officials, law enforcement officers, property vendors and service organizational assets. This is already
succeeding as evidenced by the receipt of a
providers. The engagements allowed the organization to solicit
mother title to a project in Maanzoni within
feedback that was useful in developing effective solutions and the month of January 2022.
to cultivate trust by providing transparent updates on the status
of various projects.
4
Understandably, customers who had experienced delays Continuous engagement with land
expressed anxiety in the initial stages of these engagements. officials to expedite processing of
However, clarity on the status of their investments and the ownership documents.
practical solutions proposed by Management not only restored
confidence but actually resulted in renewed interest in the new
projects leading to additional sales. Negotiations with relevant parties
Engagements with law enforcement agencies, legal services
providers and government officials also helped Management to
devise feasible solutions to legal issues affecting some of the
5 where applicable to ensure speedy
resolution of disputes.
projects in scope. Being a purchaser of value, SIC sought the

protection of the laws of the land against those who had We will also continue to engage with customers and our
attempted to defraud the organization and its customers. The members to ensure that we keep them apprised of the progress
HPL Committee instituted legal proceedings with the Director- in resolving the issues facing the projects covered by our scope.
ate of Criminal Investigations (DCI) in 8 cases. One of these
We remain committed and have no doubt that we will prevail.,
cases has already been resolved and the affected property has
reverted to SIC. Recovery of funds is underway in another case. Thank You,
On the members front, HPL provided regular feedback on the
progress of various initiatives as part of the quarterly Investor
forums hosted by the entire Board.
The above engagements resulted in the following:
Adoption of proposed solutions by our customers. Some
customers, who were offered the opportunity to relocate to Edward Njoroge
alternative projects, ended up purchasing additional units in Chairperson
those projects.
HPL Committee

Supervisory
Committee
Report 2021
1.0 Mandate
The Supervisory Committee mandate is spelt out under section 28 of the
Co-operative Societies Act Cap 490 and the Bylaws of the society. The
Committee is tasked with the responsibility of counter-checking the effective-
ness of the Society’s internal control system through carrying out investigations
as may be necessary and establishing whether Management of the society use
managerial tools like budgets, trial balances, economic reports, long term plans
and others and making recommendations to the Board.
2.0 General Observation

As the World economy continues to battle the effects of the global pandemic
(Covid-19), Kenyan economy took a significant stride in terms of growth in the
year 2021. Notable changes were recorded in various sectors of the Kenyan
Economy as compared to the previous year 2020 when the first case of
Covid-19 was recorded in the Country. According to Central Bank of Kenya
(CBK) the inflation rate stood at 5.6% compared to 5.4% recorded in the year
2020. The economy expanded by 5.1% compared to 4.0% in the previous year.
The improvement recorded in the FY 2021 is attributed to the various Govern-
Peter Mukera ment interventions. To start with, the restrictions orchestrated by the global
Covid-19 pandemic were relaxed thus freeing up the activities in various sectors
of the economy. The business activities in the country were supported by
vaccination drive implemented by the Government.
Supervisory Committee undertook a number of activities in the Financial year
2021 and is pleased to present the following updates:-
3.0 Championing of good governance and ethical practices

Good corporate governance and adherence to ethical practices is key to
achievement of organizational goals. During the year under review, Supervisory
Committee implemented a number of initiatives in an effort to uplift gover-
nance and ethical standards at both the managerial and Board levels. These
have been discussed below:-
3.1 Implementation of a whistle-blowing policy
In line with best practices the Supervisory Committee implemented a
Whistle-blowing policy that will go a long way in entrenching ethical values in the
organization. Through the framework, employees and other key stakeholders’
have been provided with an avenue through which they can bring to light any
misconduct perpetrated by officers of the Society. This will ensure that Society
assets are protected and used for the intended purpose. Further, the imple-
mentation of the policy will help the Society in avoiding reputational damage.
3.2 Sensitization on ethical practices
The Supervisory Committee through the Internal Audit and Risk Management
department undertook ethical trainings for the staff members. Four ethics and
governance training sessions were conducted in the FY 2021. The main objec-
tive was to expose staff members to code of ethics and governance in the
Society. Such sessions have been instrumental in equipping staff members with
tools that enable them to adopt ethical practices in their day to day responsibil-
ities. Further, the impact of these sessions have enabled staff members to have
the ability to critically analyze ethical issues in the Society including reporting on
unethical practices like corruption and mis-management of resources. This has
gone a long way in safeguarding the assets.
3.3 Collaboration with the Board
The Committee has continued to partner with the Board in providing oversight
on the activities implemented by the office Management. The quarterly joint

meetings have provided opportunity for the Committee to Petty cash Management
Supervisory Committee Report 2021
update the Board on audit findings and other items that are Supplier Management review
deemed to be significant. In that way the Committee has facilitat-
ed the Board with much needed information for effective Human Resource Management review
oversight.
In the year under review the Board utilized the services of the 4.2 Fraud and investigation
Supervisory Committee in reviewing areas mapped out as having
high risks. The ad hoc audits requested by the Board were aimed Fraud risk has continue to affect businesses worldwide. During the
at addressing specific concerns in the society operations. In total period a number of investigations were done on suspected cases
there were four audit reviews which were done outside the of irregular transactions. In total, three cases were investigated and
planned ones as requested by the Board. finalized.
We have also updated the Board on monthly basis on the tracking The investigations resulted in the separation of the responsible
of the implementation of key audit recommendations. This is staff members with the Society. The probes were majorly around
done through the audit tracker which basically highlights all ethical business practices and conflict of interest hence there were
significant audit findings, agreed action points to address the no financial losses incurred by the Society. We continue to
risks / weaknesses identified and status i.e. whether the audit sensitize staff members on importance of ethical practices to
issues have been implemented or not. This approach has ensured minimize such cases. It is envisaged that the implementation of
timely closure of audit issues while bringing to light areas with the whistle-blowing policy will be a deterrence measure towards
implementation challenges. stemming such vices.
This collaboration yielded fruits by continuous strengthening of 4.3 Due diligence on prospective land projects
the Society’s internal control environment. The process of land acquisition in the country continues to face a
number of risks including transacting with persons with no capacity
4.0 Internal Audit Reviews to sell such properties. The Cooperative in the past has dealt with
A number of audit reviews were conducted during the Financial dishonest persons in the land acquisition process leading to
Year 2021. These were aimed to identify internal control gaps and prolonged duration in getting land title which in turn has had an
weaknesses with a view of prescribing mitigation measures. The impact on project handover to clients.
recommendations formulated went a long way into addressing
Currently the internal audit department conducts independent
the gaps thus improving the society’s control environment.
due diligence on prospective land parcels prior to on-Boarding to
4.1 Internal Control Environment identify any red flags. This has ensured that inherent risks around
project acquisition are addressed.
The evaluation of internal control environment is aimed at provid-
ing reasonable assurance to Management and stakeholders that Planned Audit
the organization is operating in accordance with society policies,
Through Internal Audit department, audits are planned at the
industry standards, and regulatory requirements. In the year
beginning of the year on risk-based approach. This methodology
under review, we conducted a number of audits aimed at evaluat-
ensures that priority is given to areas where risk exposure are
ing compliance with internal policies as well as applicable laws
highest. In the FY 2021, we executed 90% of the audit plan.
and regulations.
There were also ad hoc audits which were commissioned by the
The Society’s internal control environment has improved over the
Board based on their risk assessment of the operations of the
years. Through the audit recommendations, the processes have
Society. These included review of SIC Agribusiness operations,
been enhanced to weed out inefficiencies and wastages. The
housing project review and income recognition audit. The overall
process of land acquisition has been strengthened to ensure that
objective was to ensure that internal control weaknesses were
due diligence is done by more than one party. This has cured the
identified.
risk on the Society on Boarding projects with controversies which
in the past has led to long delays in transferring the land projects 5.0 Monitoring of audit results
to individual purchasers. Secondly the process of engaging
service providers have been reviewed to ensure that value for Audit results should be continuously monitored to guarantee
money is achieved. This has led to better quality of services implementation of agreed action points with Management. We
especially in the value addition of projects, efficiency in the have in place a framework that periodically track the implementa-
transfer of mother title to the society and ultimately to the tion of audit recommendations. Issues that remain open post the
individual purchasers. The Internal policies and procedures have implementation timelines are escalated to the Board for further
been revamped based on the weaknesses highlighted in the action.
periodic internal control reviews. Closed audit issues included follow ups on supplier balances,
On the downside, the Society continues to confront the various weaknesses noted in the clients’ contracting process and payment
risks which have not been satisfactorily addressed. This includes process gaps among others.
below par performance in offering acceptable customer service. In the period under review, a total of 60 audit issues were raised
The myriad complains arising from dissatisfied clients whose and action points to address the risks identified agreed on by
queries cannot be effectively addressed paints a gleam picture of Management. The total percentage of issues closed stood at 68 %
challenges that the Society should focus on as a matter of for the period under review.
priority. Our focus in the FY 2022 will be to conduct a root cause
analysis on the inherent risks domiciled in the customer service Implementation of audit recommendations has led to the general
and prescribe mitigation measures. improvement of the Society’s internal control environment. This
improvement is manifested in successful land projects acquired
Some of the audit reviews undertaken in the period included the during the financial period under review. We have also seen
following: increased collections of monthly instalments in the housing
In-depth review of SIC land projects project. This is attributed to the tightening of controls around
credit Management.
Review of Samara project
Review of SIC housing project

6.0 Risk Management
Supervisory Committee Report 2021
Institutional Risk Management has remained one of the key pillars The Committee has strategically put in place a framework to
in Management. Apart from risks that have been brought by the cushion the society from the expected adverse effects precipi-
Covid-19 pandemic, the organization has continued to be faced tated by the effects of the election. The strategy is anchored on
by a number of risks ranging from operations to strategic risks. control environment strengthening and efficiency in the utiliza-
During the year we revamped our risk Management practices tion of the available resources. The Committee strategic focus
through the Internal Audit department. The department reviewed will be as highlighted below:-
risk Management framework to align it to best practices and
changes in the business environment. The department also
conducted capacity building sessions for staff members to
enhance their risk identification and evaluation techniques.
In the Financial Year 2022, the department is keen to facilitate risk 01
owners in formal risk identification and documentation through Data driven decision
risk registers. It is believed that this will facilitate risk based
02
making through
decision making as the organization matures its risk Management analytical reviews
and trend analysis
practices. Reviewing of current
Key Performance
Indicators (KPIs)
applicable to the
7.0 Review of financial performance of Year 2021 various departments
as well as formulating
The Society posted a net operating surplus before rebates of KES new ones
195,671,599/- as compared to KES 17,648,282/- in the previous
year. The growth in the profits has been attributed to various
factors including the improved performance by the Board and
staff members. While this growth in profits is commendable, we 03 Championing of
would like to recommend the following going into the future:- risk-based decision
making during on
04
Boarding of new
projects to avoid
01 05
strategic pitfalls
Implementation of
continuous cost
Diversify the
03 Double efforts in
monitoring practices
to maximum on the
business to Implement cost debt collections to profits
avoid Management to ensure project
overreliance maximize closure and ultimate
on land business profitability revenue recognition
Conclusion
On behalf of the Supervisory Committee, I take this chance to
Continuously thank members for giving us the opportunity to serve in this
Plan ahead of time Leverage on
to ensure that technology to rethink its Committee. Our gratitude also goes to SIC Board, Management
improve efficiency strategies in and staff for the cooperation that they accorded us in the year
products are
in delivery of value customer service
availed in time
to address the
2021. We look forward to continuous collaboration with all
to the market to clientele
various concerns stakeholders to improve the control and governance
(earlier in the year)
environment of SIC.
04
voiced by clients
02 06 Thank you!
8.0 Strategic focus going forward into FY 2022 Signed by:

Supervisory Committee is committed to the improvement of the
Society’s internal control environment as it is mandated by both
………………………………………………………………..…
the Cooperative Society’s Act and the Bylaws. It is predicted that
the FY 2022 being an electioneering year for the country will not Peter Mukera
be short of challenges that may affect achievement of results. It Chairperson
is envisaged that the investors will exercise restraint as we head
towards the general election in August 2022.
……………………………………………………………..….
Beth Mwangi
Secretary
……………………………………………………………..….
Rabecca Bisanju
Member

Pepea Fixed Deposit
PEPEA has been one of the most lucrative, competitive, and equally compelling product to members
from the time Safaricom Investment Cooperative launched it. From its inaugural name of “Wajanjez”
and now to “Pepea” Fixed Deposit, this product remains to be one of the premium members’ product
for our shareholders.
Pepea fixed deposit has received numerous positive testimonials key being how it assisted one of
our shareholders Doline Busolo fund her farming project in Kajiado County, a story that was featured
in “USHIRIKA” TV infomercial done by Chams Media in partnership with Cooperative Bank. We look
forward to positioning this product to maintain its competitive nature in the market with the main
objective being meeting our customers’ satisfaction by onBoarding products that meet their needs
and preferences.
With the zero percent risk nature of this product, we continue to make it a proposition for our
shareholders consideration as a sure way of diversifying portfolios away from the share purchase and
the Interest Earning Deposit. We believe that the 6 to 12 months subscription period accorded to it
affords our shareholders extra flexibility that enables planning for future projects prior to its
liquidation.
With Pepea Fixed Deposit, you can keep

golfing while your money works for you.

HR’s Desk;
Our People
SIC has been evolving in the recent past and also adjusting to the realities of
COVID 19 pandemic amidst challenging business targets.
Adding value to our investors has been at the heart of SIC’s strategies. Corporate
strategies are not formulated and realized in a vacuum; they require people. The
strides that have been realized in the past one year would not have been realized
were it not for the dedication and focused energy of each of the team players.
To this end, we recognize and commend each and every employee for their valued
contribution even as we reiterate the society’s commitment to the people agenda.
Our people are a very key resource and as the business grows so do people.
Amidst challenging times and the COVID 19 environment in the year 2021, we
supported, equipped and steered our team towards achievement of the following:
Performance: We focused on both individual and business performance and
successfully maneuvered through the tides towards profitability.
Capacity building: There was commendable growth of our people’s capacity
through learning and they were able to push the business agenda.
Technology: We rolled out an ERP system to support our processes improving
on the turnaround time.
Culture: We embraced new ways of doing things and made the work
environment more conducive.
Looking ahead, we commit to focus on:

Franciscar Saina
The Human Resource Investing in our people who will turn around the business.
We endeavor to offer the necessary support and tools in order to transform this
organization to be the most profitable Cooperative society giving maximum
returns to the shareholders.
We are focused in making SIC an employer of choice
When you invest in the people, they take care of your business.
Housing Business Department Investment & Investor

Relations Department

Finance Department HR & Admin Department
HPL Department Procurement Department
Titling Department Legal Department

Sales Department
Customer Experience Department Sourcing & Acquisition Department.
Internal Audit and Risk Management Department ICT Department

Employees of the various months- 2021
May July August
Emelda Aira Robinson Nyaruria Shedrack Mainga

Emelda is hardworking, focused, self-driven Robinson is hardworking, resourceful, Shedrack is an aggressive and committed
and resilient. diligent and possesses a positive attitude. team player who is always keen on details,
She has challenged all of us with her punctual and respectful to all team
He manages logistical arrangements for
positive attitude and determination to members. He has taken leadership and
clients and staff effectively and has been
push on. During the period ended 30th successfully organized activations and
able to deliver 99% of the value adds by
April 2021, she managed to collect a total various street activations that have seen
the time of the first site visit contributing
of Kes. 26,557,210 which is 66.4% of her improved pipeline and sales.
to the sales team achieving their set
target. targets.
September October December
Eliphas Wairangu Myrah Maisy A. Jared Nyagwoka

Eliphas is an inquisitive, self-driven, Myrah has an enormous self-drive to learn, Jared is an early bird who is dedicated,
altruistic and committed team player. He Passionate about Customer Experience filled aggressive, hardworking and has ably
championed projects reconciliation and with a great Positive Zeal and a team player. taken up assigned delegated roles
worked tirelessly for long hours, many effectively.
Myra has contributed notable transformation
times beyond work hours to ensure
in the delivery of her roles and pushes the Jared has a rich institutional memory that
successful completion. This has created
agenda to staff to treat customers closely, came in handy in the resolution of past
visibility on available stock, which
kingly and passionately as she believes this to troubled projects. He compiled and
assisted in strategic decision-making.
be a sure way of retaining our clientele. She documented historical projects that had
innovatively introduced the Daily CX nuggets great impact to the society’s reputation.
segment which are forever green sentiments Information which was analyzed to create
fit for internal staff consumption that has meaningful data that was useful for
gone a long way in ensuring we are forever decision making by management.
reminded of the worth of our customers.

Outstanding Departments - 2021
1st Position: Sales Department
2nd Position: Sourcing & Acquisition 3rd Position: HPL Department

Department.

Automation through
the ERP System
Technology remains a key enabler in our continued endeavor to deliver
services efficiently and conveniently to our members. To this end, the
Cooperative started the Implementation of a new ERP Project
christened “Project YURI” and continue making investments in ICT
infrastructure to ensure enhanced growth and operations of the
Cooperative while availing services to members conveniently.
Safaricom Investment Cooperative has been in the frontline of

implementing innovations within the Cooperative movement in Kenya.
The adoption and utilization of Information and Communication
Technology (ICT) has been fundamental to providing competitive
services to meet the current and future needs of the Cooperative.
SIC has successfully upgraded and improved the core business system
(CBS). The project scope covering areas of Finance & Accounting,
Project Management, CRM, Sales & Marketing, Business Intelligence
(BI), Supply Chain Management, Registration & Admin Management,
Document Management, System Administration & Audit, Web Portals
(Employee Self Service ESS, Vendor, Customer and Shareholders Portal)
and implemented a new robust interactive website as well as
Applications on the Android and iOS platform.
Arnold Mnjama
This was necessitated by the need to improve the cooperative operational efficiency, customer experience and creating a
competitive edge over the competition in service delivery, In-addition creating convenience to the member.
Safaricom Investment Cooperative after an extensive and intensive competitive search contracted a vendor who is a
Microsoft Partner, to provide an advanced ERP Solution on Dynamics 365 Business Central to help address the future needs
of our Cooperative.

The New ERP System will be more robust and dynamic, mainly focusing on Customer Service, Data Integrity and Reliability.
Great milestones have so far been achieved through the system development life cycle, from Project Initiation,
Requirement Analysis, Design & Development, Integration, Data Migration, User Acceptance Testing (UAT’s), System
Integration Testing (SIT’s), Trainings, Post Go Live Support (PGLS) which is currently underway even as the System has Gone
–Live.
The User Acceptance Testing and Dry runs have been a great deal of effort that ensured the systems is fully operational
end-to-end including all the required integrations.
C2B integrated Collection -With rapid growing customer portfolio and constant advancement on technology in financial
sector, SIC required sophisticated bank collection solution that address accounts reconciliations problem associated with
multi-channel member and customer deposit payments.
The Cooperative sought banking partners that integrate to the Cooperative ERP System to facilitate real-time collection,
validation and advice of customer payments while guaranteeing accurate accountability of each individual member
payment to the last coin.
Security - It is critical that information security is upheld even as we strive to provide a range of solutions. Collaborating with
Safaricom PLC on infrastructure, applications and endpoint security solutions provide improvement on how we monitored
our systems.
We greatly appreciate your support thus far in ensuring a successful outcome that will deliver brilliance today and
transformation for brighter tomorrow. This is another big milestone for the Cooperative fraternity, our customers and our
treasured Shareholders.
Arnold Mnjama Mwanyadi

Systems Administrator

Society’s Information
The Management Committee submit their report and audited financial statements for the period ended 31st December, 2020.
Principal Activities
The principal activities of the society are as listed below:-
Real Estate 01 Marketable Securities 02 Private Equity 03
Management Committee MEMBERS

The following served during the year:-
Peter Gichangi : Chairperson

Tom Macakiage : Vice Chair Person
Judy Runo : Secretary
Vincent Opiyo : Treasurer
Agnes Marete : Board Member
Emily Kilongi : Board Member
Edward Njoroge : Board Member
Jackson Mulwa : Board Member
Michael Akal : Board Member
Supervisory Committee
Peter Mukera : Chairperson
Beth Mwangi : Secretary
Rebecca Bisanju : Member
BANKERS
a. Co-operative Bank of Kenya Limited-Westlands Branch
b. Bank of Africa
c. Safaricom Sacco FOSA Account
d. Sidian Bank
With Partners
a. KCB Bank Limited
b. Stanbic Bank
AUDITORS
Ronalds LLP
Certified Public Accountants,
3rd Floor Rhapta Heights,Rhapta Road, Westlands
P.O. BOX 41331-0100
Nairobi, Kenya

Report of the Management
Committee
The members of the Management Committee submit their annual report together with the audited financial statements for the year
ended 31st December 2021.
Incorporation
The society is incorporated in Kenya under the Cooperative Societies Act. Cap 490 of 1997 amended 2004 and is domiciled in Kenya.
Principal Activity
The principal activities of the society are as listed below:
Real Estate
Marketable securities
Private Equity
Results 2021 2020

Ksh Ksh
Surplus/Deficit before tax 78,268,640 5,517,665

Income Tax Expense (4,872,206) -
Net Surplus (deficit) after Tax 73,396,434 5,517,665
Proposed rebates on members’ share capital 117,402,959 12,130,617
Management Committee
The members of the Management Committee who served during the year and to the date of this report are listed on page 1.
Auditors
The Society`s auditors, Messrs Ronalds LLP, Certified Public Accountants (K) who were appointed during the year have expressed their
willingness to continue in office in accordance with section 719 of the Companies Act (Cap 486) and under the terms of section 25 (4)
of the Co-operative Societies(Amendment) Act No.2 of 2004.
By order of Management Committee
Signature Date
Hon. Secretary.

Independent Auditor’s Report


FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021

41
Statement of Management’s
Responsibilities
The Cooperative Societies Act requires the Board of Directors to prepare financial statements for each year which give a true and fair
view of the state of affairs of the society as at the end of the financial year and its operating results for that year in accordance with
International Financial Reporting Standards (IFRS). It also requires the Board of Directors to ensure that the society keeps proper
accounting records which disclose with reasonable accuracy at any time the financial position of the society. They are also responsible
for safeguarding the assets of the society and ensuring that the business of the society has been conducted in accordance with its
objectives, by-laws and any other resolutions made at society’s general meeting.
The Board of Directors accepts responsibility for the annual financial statements which have been prepared using appropriate
accounting policies supported by reasonable and prudent judgments and estimates, in conformity with International Financial Reporting
Standards ( IFRS) and in the manner required by the Co-operatives Societies Act, Cap 490. The Board of Directors is of the opinion that
the financial statements give a true and fair view of the state of the financial affairs of the society and of its operating results in
accordance with the International Financial Reporting Standards (IFRS). The Board of Directors further accepts responsibility for the
maintenance of accounting records which may be relied upon in the preparation of financial statements, as well as adequate systems of
internal financial control.
Nothing has come to the attention of the Board of Directors to indicate that the society will not remain a going concern for at least twelve
months from the date of this statement.
CHAIRMAN:
SECRETARY:
TREASURER:

Statement of Management’s
Representation
The co-operative Societies Act Cap 490 require the Management Committee to prepare accounts for each financial year
which give a true and fair view of the state of financial affair of the society at the end of the financial year, and the operating
result.
It also requires the Management Committee to ensure that the society keeps proper accounting records which disclose with
reasonable accuracy at any time, the financial position of the society.
The Management Committee accept the responsibility for the Financial statement, which have been prepared using
appropriate accounting policies supported by reasonable and prudent judgments and estimates, in conformity with generally
accepted accounting practice and in the manner required by the Co-operative Societies Act Cap 490.
The Management Committee are of the opinion that the accounts give a true and fair view of the state of the financial affairs
of the society and the operating results.
The Management Committee further accept responsibility for the maintenance of accounting records which may be relied
upon in the preparation of accounts, as well as adequate systems of internal controls.
Nothing has come to the attention of the members of the Board of Directors to indicate that the Society will not remain a
going concern for at least the next twelve months from the date of this statement.
CHAIRMAN:
SECRETARY:
TREASURER:

CHAIRMAN:
SECRETARY:
TREASURER:
The exquisite Nakuru Greens project is 7 min drive from
Nakuru City, along Nakuru - Eldoret Highway This parcel is
strategically situated at the turnoff point of Sobea centre,
behind the Gicheha farm off Kabarak road overlooking the Mau
summit.
STA RTING FROM
kes.
429,000 .00
1/ 8
acre
Amenities in the area include:
Water on site Hospital Learning Institutions
Electricity on site Security

Shopping complexes 42 SAFARICOM INVESTMENT CO-OPERATIVE
Churches & Mosques
0729 12 12 12 | info@sic.co.ke | www.sic.co.ke

FINANCIAL
REPORT
2021
2022 & 2023 Budget
(73,800,000) (92,250,000)
(739,622,247) (556,907,871) (1,326,173,045) (1,657,716,306)
Capital Budget

Statistical Information
2021 2020
Number of Members 4,890 4,644
Members’ Fund
Ksh Ksh
Share Capital 2,504,334,145 2,500,715,663
Statutory Reserves 30,258,633 15,579,346
Proposed Rebates to Members 117,402,959 12,130,617
Assets
Property, Plant and Equipment 11,413,201 7,019,891
Intangible Assets 23,533,131 20,093,807
Current Assets 4,089,507,079 3,339,747,345
Non-current Assets 755,534,215 1,121,201,084
Liabilities
Non Current Liabilities 1,042,411,717 1,025,659,293
Current Liabilities 1,664,908,832 1,415,055,916
Profitability Ratios
Turnover 1,000,669,401 456,456,628
73,396,434 5,517,665
Interest on Members Deposits as % 4.688% 0.485%

of total Share Capital
Expenditure
Operating Expenditure as a
% of Turnover 17% 15%
Return on Members Deposit as a

% of turnover 12% 3%
Liquidity Ratios
Current Ratio 2.5 2.4
Acid Test Ratio 1.4 1.4
Return Ratios
Return on Assets 3.914% 0.383%

Statement of Profit or Loss
and Other Comprehensive Income
2021 2020
Notes Ksh Ksh
Revenue:
Revenue - Sale of land and houses 2 973,154,474 437,871,534
Cost of sales - Purchase of land and houses 3 (604,389,814) (269,016,847)
Gross surplus- sale of land and houses 368,764,660 168,854,687
Interest Income 4 16,240,688 7,269,151
Rental income 5 5,138,904 1,591,079
Other Income 6 6,135,335 9,724,864
396,279,587 187,439,781
Expenses:
Administration Expenses 7 20,185,167 19,480,761
Personnel Expenses 8 76,886,474 66,918,386
Financial Expenses 9 46,914,618 1,579,132
Professional Expenses 10 21,345,065 9,133,767
Governance Expenses 11 11,125,160 9,948,879
Business Development Expenses 12 15,246,852 18,539,276
Provision for prior year projects (HPL) 13 5,026,256 42,049,040
Depreciation/Amortisation 14 3,878,396 2,142,259
200,607,988 169,791,500
Net operating surplus before Rebates 195,671,599 17,648,282
Rebates to Members (117,402,959) (12,130,617)
Net operating surplus before tax 78,268,640 5,517,665
Income Tax Expense 27. (4,872,206) -
Net surplus for the year 73,396,434 5,517,665

Statement of Financial Position

Statement of Changes In Equity
Share Statutory Retained

Capital Reserve Earnings Total
Kshs. Kshs. Kshs. Kshs.
Balance as at 01.01.2020 2,500,715,663 14,475,813 (59,510,485) 2,455,680,991

Profit for the year - - 5,517,665 5,517,665
20% statutory reserve - 1,103,533 (1,103,533) -
Proposed Honoraria - - - -
Prior year project withdrawals - - (61,910,888) (61,910,888)
Balance as at 31.12.20 2,500,715,663 15,579,346 (117,007,242) 2,399,287,767
Balance as at 01.01.2021 2,500,715,663 15,579,346 (117,007,242) 2,399,287,767

Profit for the year - - 73,396,434 73,396,434
20% statutory reserve - 14,679,287 (14,679,287) -
Additions during the period 3,618,482 - - 3,618,482
Proposed Honoraria - - (5,000,000) (5,000,000)
Balance as at 31.12.2020 2,504,334,145 30,258,633 (84,068,184) 2,450,524,594

Statement of Cash Flow
2021 2020
Kshs. Kshs.
Cash Flows from operating activities
Receipts for the year 1,000,669,401 456,456,628
Payments to staff and suppliers (922,400,353) (424,535,471)
78,269,048 31,921,157
Increase/Decrease in Operating Assets
Receivable & Prepayment (323,104,069) 194,932,671
Decrease/(increase) in Housing stock (13,143,055) 111,948,708
Increase /decrease in Land held for sale (341,530,925) (3,876,986)
Decrease/(increase) Agribusiness (670,310) (670,310)
Decrease/(increase) in land for housing projects - (14,850,230)
Decrease/increase in land for investment 29,136,245 -
(Increase) in deferred income 390,700,520 (89,824,561)
Increase/Decrease in Operating Liabilities
Creditors 37,635,613 (477,433,772)
Net Cash from operating activities before taxes (142,706,933) (274,853,323)

Tax paid (1,451,203) -
Net Cash from operating activities after taxes (144,158,136) (247,853,323)
Cash Flows from/used in Investing Activities

Net Increase in fixed assets (6,540,425) (20,083,208)
Acc dep on disposal 4,205,077
Changes in investment (29,091,554) (162,743,480)
Investment in Zaria LLP 70,662,330 96,255,030
(39,235,428) (86,571,658)
Cash Flows from Financing Activities

Increase in share capital 3,618,482
Net movement in loans 16,752,424 425,295,881
Project withdrawals - (61,910,888)
Dividend Payment 105,272,343 (12,130,617)
Net cash from Financing Activities 125,643,249 351,254,376
Net Increase in Cash and Cash Equivalent 20,720,541 16,829,397

Cash and Cash Equivalent at the Beginning of the Year 151,863,679 135,034,281
Cash and Cash Equivalent at the End of the Year 172,584,220 151,863,679

Accounting Policies
1) Summary of Significant Accounting Policies
The principal accounting policies adopted in the preparation of iii) Commission income is recognized upon successful
these financial statements are set out below: completion of the transaction;
iv) Miscellaneous income is recognized upon performance of
Basis of Preparation the services agreed on.
a) Statement of compliance v) Interest income is recognized on an cash basis in the profit
The financial statements are prepared in accordance with and or loss for the year using the effective yield on the asset.
comply with International Financial Reporting Standards (IFRSs). Interest income includes income from investment in money
markets. When financial assets become impaired, interest
These financial statements are presented in the functional
income is thereafter not recognized until such time that
currency, Kenya shillings (Kshs) and prepared under the
recoverability is assured.
historical cost convention, except as specified below under fair
value measurement in accordance with applicable IFRSs. c) Property, plant and equipment
The financial performance of the society is set out in the All property, plant and equipment are initially recorded at cost.
Director's report and in the statement of profit or loss and other Certain classes of property, plant and equipment are
comprehensive income. The financial position of the society is subsequently shown at revalued amounts, based on periodic
set out in the statement of financial position. valuations by the independent valuers, less subsequent cost. All
Based on the financial performance and position of the society other property plant and equipment are stated at historical cost
and its risk Management policies, the directors are of the less accumulated depreciation and impairment losses.
opinion that the society is well placed to continue in business for Rates
the foreseeable future and as a result the financial statements Computers 30.00%
are prepared on a going concern basis. Motor Vehicle 25.00%
Phones Accessories 33.00%
b) Revenue recognition Furniture & Equipment 12.50%
Project income Intangible Assets
Under IFRS 15, revenue is recognized when the goods or services Intangible assets include computer software recognized in the
are transferred to the customer, at the transaction price. Apply- books at cost and amortised over an estimated useful life based
ing IFRS 15, an entity recognizes revenue to depict the transfer on the circumstances at an annual rate of 30% per annum based
of promised goods or services to the customer in an amount on reducing balance method. Amortisation for the year 2021 has
that reflects the consideration to which the entity expects to be been calculated on a pro-rata basis.
entitled in exchange for those goods or services. The society is
De-recognition
in compliance with the provisions of the standard. The core
principle is derived in a five step model framework: The carrying amount of an item of property, plant and
equipment shall be derecognized:
1) Identify the contract(s) with a customer. There is a legally
(a) on disposal; or
enforceable contract between a customer and Safaricom
(b) when no future economic benefits are expected from its use
Investment Co-operative Society Limited.
or disposal.
2) Identify the Performance obligations in the contract: perfor-
The gain or loss arising from the De recognition of an item of
mance obligations include the construction of houses &
property, plant and equipment shall be included in profit or loss
purchase of land as per the requirements of the contract.
when the item is derecognized (unless IAS 17 requires otherwise
3) Determine the transaction price: The Society applies a on a sale and leaseback). Gains shall not be classified as revenue.
markup on the expenses incurred during construction of the
houses and purchase of the land. d) Adoption of new Standards and Interpretations
4) Allocate the transaction price to the performance obliga- The following standards and interpretations have been adopted
tions in the contract: The transaction price is only allocated as they are mandatory for the year ended 31 December 2021 as
to the purchase of land & construction of houses. they were effective for annual periods beginning on or after 1
January 2016;
5) Recognize the revenue when(or as) the entity satisfies a
performance obligation: Revenue is recognized based on i) Disclosure Initiative - Amendments to IAS 1
the above when the performance obligation has been The amendments clarify the materiality requirements in IAS 1,
satisfied i.e. Transfer of land,completion of the house,and that specific items in the statements of comprehensive income
transfer the house to the customer on full payment of the and financial position may be disaggregated, that entities have
contract amount. flexibility as to the order in presenting notes to the financial
Other income statements,; and that the share of other comprehensive income
of associates and joint ventures, accounted for using the equity
i) Entrance fee is recognized when a new member joins the method, must be presented in aggregate as a single line item,
society; and classified between those items that will not be
ii) Dividend is recognized when the right to receive income is subsequently reclassified to profit or loss. The amendments are
established. Dividend are reflected as a component of intended to assist entities in applying judgement when meeting
other operating income based on the underlying classifica- the presentation and disclosure requirements in IFRS, and do
tion of the equity instrument; not affect recognition and measurement.

Accounting Policies
ii) IFRS 10, IFRS 12 and IAS 20 Investment Entities; Applying e) New Standards and Interpretations not yet adopted
the Consolidation Exemption-Amendments to IFRS 10,IFRS
The following new Standards and amendments to standards and
12 and IAS 28
interpretation effective 31 December 2016 are not expected to
The amendments to IFRS 10 clarify that the exemption in =have a significant effect on the financial statements of the
paragraph 4 of IFRS from presenting consolidated financial Society in future financial periods, or not applicable to the
statements applies to a parent entity that is a subsidiary of an Society based on the existing assets and liabilities;
investment entity, when the investment entity measures its
subsidiaries at fair value. Furthermore, the amendment to IFRS 10 i) IFRS 9: Financial instruments
clarify that only a subsidiary of an investment entity that is not an Issued on 24th July 2014 this standard replaces earlier version of
investment entity itself and that provides support services to the IFRS 9 and superseded IAS 39, the criteria for classification into
investment entity is consolidated. All other subsidiaries of an these categories are significantly different. In addition, the IFRS9
investment entity are measure at fair value. impairment model has been changed from an ‘incurred loss”
The amendment to IAS 28 allow the investor, when applying the model from IAS 39 to an “expected loss” model.
equity method to retain the fair value measurement applied by The standard is effective for annual periods beginning on or after
the investment entity, associate or joint venture to its interest in 1 January 2018 with retrospective application, early adoption
subsidiaries. permitted.
iii) IAS 16 and IAS 38-Ammendements to IAS 16 and IAS 38: The Society is assessing the potential impact on its financial
Clarification of Acceptable Methods of Depreciation and statements resulting from the application of IFRS 9 but this is
Amortization yet to be implemented during the year.
The amendment clarifies the principle in IAS 16;Property ,Plant The Society classifies its financial instruments into the
and Equipment and IAS 38;Intangible Assets that revenue following categories:
reflects a pattern of economic benefits that are generated from
i) Financial assets at fair value , which comprise of those held
operating a business(of which the asset is part) rather than the
at Fair Value through Other Comprehensive Income(FVOCI)
economic benefits that are consumed through use of the asset.
which meet the Solely Payments of Principal and
As a result, the ratio of revenue generated to the total revenue
Interest(SPPI) test and are held in a business model in which
expected to be generated cannot be used to depreciated
assets are managed both to collect contractual cash flows
property, plant and equipment and may only be used in very
and for sale and those held at Fair Value through Profit or
limited circumstances to amortized intangible assets.
Loss(FVTPL) which are all other financial assets that do not
iv) Accounting for Acquisition of interest in joints operations - qualify for measurement at FVOCI
Amendments to IFRS 11 ii) Financial assets at amortized cost, which comprise of
The amendment requires an entity acquiring an interest in a joint financial assets which meet the Solely Payments of Principal
operation, in which the activity of the joint operation constitutes and Interest (SPPI) test and are held within a business model
a business, to apply, to the extent of its share, all of the principles whose objective is to hold financial assets in order to collect
in IFRS 3 and other IFRSs that do not conflict with the contractual cash flows only.
requirements of IFRS 11 Joint Arrangements. Furthermore, iii) Financial liabilities at fair value through profit or loss, which
entities are required to disclose the information required by IFRS
comprise of those held for trading and those designated at
3 and other IFRSs for business combinations. The amendment
FVTPL upon initial recognition.
also apply to an entity on the formation of a joint operation if,
and only if, an existing business is contributed by one of its iv) Financial liabilities at amortized cost, which comprises of all
parties to the joint operation on its formation. Furthermore, the other financial liabilities except for those that the fair value
amendment clarify that, for the acquisition of an additional option has been elected.
interest in a joint operation in which the activity of the joint ii) IFRS 15: Revenue from Contracts
operation constitutes a business, previously held interest in the
joint operation must not be remeasured if the joint operator IFRS 15 was issued on May 2014 and establishes a new five-step
retains joint control. model that will apply to revenue arising from contracts with
customers. Under IFRS 15,revenue is recognized at an amount
v) IAS 27: Equity Method in Separate Financial Statements - that reflects the consideration to which an entity expects to be
Amendments to IAS 27 entitled in exchange for transferring goods or services to a
The amendment allow an entity to use the equity method as customer. The principles in IFRS 15 provide a more structured
described in IAS 28 to account for its investment in subsidiaries approach to measuring and recognizing revenue. The Society
joint ventures and associates in its separate financial has assessed the impact of the new standard on the required
statements. Therefore, an entity must account for its effective date and has fully complied with the standard in the
investments either(1) at cost;(2) in accordance with IFRS 9; or (3) financial year 2019 and its subsequent years.
using the equity method. The entity must apply the same iii) IFRS 16: Leases
accounting for each category of investment, and the
amendment must be applied retrospectively. The new standard introduces a single on balance sheet
accounting model, similar to the current finance lease
vi) IAS 7: Disclosure Initiative - Statement of Cash flows
accounting. Under the new standard the society will be required
The amendment are part of the IASB's Disclosure Initiative and to recognize a 'right to use' asset and a lease liability for all
require an entity to provide disclosures that enable users of identified leased assets in the statement of financial position.
financial statements to evaluate changes in liabilities arising from The current operating lease(rent) expense will be replaced with
financial activities, including both changes arising from cash flow a depreciation and finance charge. The standard becomes
and non-cash changes. The amendments are intended to applicable for the financial year beginning on or after 1 January
provide information to help investors better understand changes 2019 and the society intends to adopt IFRS 16 in the subsequent
in a Company's debt. year. While it is not expected to be a material impact on overall

Accounting Policies
cash flows and net profit or loss, the quantification of such All financial liabilities are recognized initially at fair value of the
impact cannot be reliably measured. consideration given plus the transaction cost with the exception
of financial liabilities carried at fair value through profit or loss,
iv) IFRS 2: Classification and Measurement of Share Based which are initially recognized at fair value and the transaction
Payments Transactions-Amendments to IFRS 2 costs are expensed in the statement of comprehensive income.
The amendments to IFRS 2 are intended to eliminate diversity in Subsequently, all financial liabilities are carried at amortized cost
practice, and addresses three main areas; (1) The effect of using the effective interest method except for financial liabilities
vesting conditions on the measurement of a cash -settled share through profit or loss which are carried at fair value.
based payment transactions,(2)The classification of a share
based payment transaction with net settlement features for the All financial liabilities are classified as non-current except
withholding tax obligations (3) The accounting where a financial liabilities at fair value through profit or loss, those
modification of the terms and conditions of a share based expected to be settled in the company's normal operating cycle,
payment transaction changes its classification from cash settled those payable or expected to be paid within 12 months of the
to equity settled. reporting date and those which the company does not have an
unconditional right to defer settlement for at least 12 months
after the reporting date.
f) IAS 12: Income Taxes
De - recognition of Financial Liabilities
According to IAS 12,current tax for current and prior periods shall,
to the extent unpaid, be recognized as a liability. If the amount Financial liabilities are de-recognized only when the obligation
already paid in respect of current and prior periods exceeds the specified in the contract is discharged or canceled or expires.
amount due for those periods, the excess shall be recognized as Provision for liabilities and charges
an asset. Current tax liabilities (assets) for the current and prior
Provisions are recognized when the company has a present legal
periods shall be measured at the amount expected to be paid to
or constructive obligation as a result of past events, it is
(recovered from) the taxation authorities, using the tax rates
probable that an outflow of resources embodying economic
(and tax laws) that have been enacted or substantively enacted
benefits will be required to settle the obligation, and a reliable
by the balance sheet date.
estimate of the amount of the obligation can be made.
Deferred income tax is provided, using the liability method, on
Other financial liabilities
temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the financial All other financial liabilities, including borrowings, are initially
statements. However, the deferred income tax is not accounted measured at fair value, net of transaction costs.
for if it arises from initial recognition of an asset or liability.
Other financial liabilities are subsequently measured at
Currently enacted tax rates are used to determine deferred
amortized cost using the effective interest method, with interest
income tax.
expense recognized on an effective yield basis.
Deferred income tax assets are recognized only to the extent
that it is probable that the future taxable profits will be available h) Employee entitlements
against which temporary differences can be utilized. Employee entitlement to long service awards are recognized
when they accrue to employees. Provision is made for the
g) Financial liabilities and equity instruments issued estimated liability of such entitlements as a result of services
by the Society rendered by employees up to the reporting date. The estimated
monetary liability for employees’ accrued annual leave
Classification as debt or equity entitlement at the reporting date is recognized as an expense
accrual.
Debt and equity instruments are classified as either financial
liabilities or as equity in accordance with the substance of the i) Retirement benefit obligations
contractual arrangement. The Society operates a defined contribution scheme for all
Equity instruments employees. A defined contribution plan is a pension plan under
which the society pays fixed contributions into a separate entity.
An equity instrument is any contract that evidences a residual The assets of these schemes are held in a separately
interest in the assets of an entity after deducting all of its administered fund that is funded by contribution from the
liabilities. Equity instruments issued by the Society are recorded society and employees.
at the proceeds received, net of direct issue costs. The capital
comprise primarily of minimum share capital prescribed under The Society has no legal or constructive obligations to pay
the By-laws of the Society. further contributions if the fund does not hold sufficient assets
to pay all employees the benefits relating to employee service in
Financial guarantee contract liabilities the current and prior period. The society’s contributions to the
Financial guarantee contract liabilities are measured initially at defined contribution schemes are charged to the profit or loss in
their fair values and are subsequently measured at the higher of:• the year to which they relate.
The amount of the obligation under the contract, as The Society also contributes to a mandatory statutory defined
determined in accordance with IAS 37 Provisions, Contingent contribution pension scheme, the National Social Security Fund
Liabilities and Contingent Assets; and (NSSF) at varying values for its employees as legislated from time
to time.
The amount initially recognized less, where appropriate,
cumulative amortization recognized in accordance with the j) Statutory reserves
revenue recognition policies.
Transfers are made to the statutory reserve fund at a rate of 20%
Financial liabilities of net operating surplus after tax in compliance with the
provision of section 47 (1& 2) of the Co-operative Societies Act
Financial liabilities are classified as either financial liabilities ‘at
,Cap 490.
FVTPL’ or ‘other financial liabilities’.

Accounting Policies
k) Cash and cash equivalents Management of capital. Further quantitative disclosures are
included throughout these financial statements. The Society`s
Cash and cash equivalents comprise of cash at hand and risk Management policies are established to identify and analyze
demand deposits and other short-term highly liquid investments the risks faced by the Society,to set appropriate risk limits. Risk
that are readily convertible to a known amount of cash and are Management policies and systems are reviewed regularly to
subject to an insignificant risk of changes in value net of bank reflect changes in market conditions and the Society activities.
overdrafts. 1. Credit Risk
l) Provisions for liabilities and other charges Credit risk arises mainly on cash and cash equivalents and trade
& other receivables. Management assesses the credit quality of
A provision is recognized in the statement of financial position each customer,taking into accountants financial position,past
when the Society has a legal or constructive obligation as a result experience and other factors. The amount that best represents
of a past event and it is probable that an outflow of economic the Society`s maximum exposure to credit risk as at 31 December
benefits will be required to settle the obligation. If the effect is 2021 is made up as follows:
material, provisions are determined by discounting the expected
future cash-flows at a pre tax rate that reflects current market
assessment of the time value of money and, when 2020 2020
appropriate,the risks specific to the liability. Kshs Kshs
M) Collateral Trade receivables(Note 17) 961,108,405 1,234,060,270

Bank balance 172,584,220 151,863,679
The Society discloses:
1,133,692,625 1,385,923,949
(1) The carrying amount of financial assets it has pledged as
collateral for liabilities or contingent liabilities, including amounts 2. Liquidity Risk
that have been reclassified in accordance with paragraph 37(a) of Liquidity risk is the risk that the Society will not be able to meet
IAS 39; and its financial obligations as and when they fall due. The Society`s
(2) The terms and conditions relating to its pledge approach to managing liquidity is to ensure,as far as
possible,that it will always have sufficient liquidity to meet its
When the Society holds collateral (of financial or non-financial liabilities when due,under both normal and stressed conditions
assets) and is permitted to sell or re-pledge the collateral in the ,without incurring unacceptable losses or risking damage to the
absence of default by the owner of the collateral, it shall disclose: Society`s reputation.
(i) the fair value of the collateral held; 3. Market Risk
(ii) the fair value of any such collateral sold or re-pledged, and Market risk is a risk that the fair value or future cash-flows of
whether the entity has an obligation to return it; and financial instruments will fluctuate due to changes in market
variables such as interest rates,foreign exchange rates and equity
(Iii) the terms and conditions associated with its use of the prices.
collateral.
n) Foreign Currency Transactions p) Key source of estimation uncertainty

Transactions in foreign currency are translated at the foreign These are assumptions applied in estimating the carrying
exchange rate ruling at the date of the transaction. Monetary amounts and the underlying estimation uncertainty may lead to
assets and liabilities denominated in foreign currencies at the those amounts changing materially in the next 12 months.
reporting date are translated to Kenya Shillings at the rate of Examples of situations involving estimation uncertainty:
exchange ruling at that date. 1) In the absence of recently observed market prices, future
Transactions during the period in foreign currencies are oriented estimates are necessary to measure the recoverable
translated at the rates ruling at the dates of the transactions. amounts of classes of property, plant and equipment.
Gains or losses on exchange are recognized in profit or loss. 2) The effect of technological obsolescence on inventories
Non-monetary assets and liabilities that are measured in terms 3) Provisions subject to future outcome of litigation in progress
of historical cost in a foreign currency are translated using the
exchange rates as at the dates of the initial transactions. 4) In determining the liability for long-service payments,
Non-monetary assets and liabilities measured at fair value in a Management must make an estimate of salary increases over
foreign currency are translated using the exchange rates at the the following five years, the discount rate for the next five years
date when the fair value is determined. to use in the present value calculation, and the number of
employees expected to leave before they receive the benefits.
o) Financial Risk Management q) Significant judgment(s) in applying the Society’s

The Society has exposed three following risks from the use of
accounting policies
financial instruments: Disclosure is made of significant judgments (apart from those
involving estimations) made in applying the accounting policies
i) Credit risk that have the most significant effect on the amounts recognized
ii) Liquidity risk in the financial statements.
1) When substantially all the significant risks and rewards of
iii) Market risk ownership of financial assets are transferred to other entities
The note presents information about the Society`s exposure to 2) Whether in substance, particular sales of goods are financing
each of the above risks,the Society`s objectives,policies and arrangements and therefore do not give rise to revenue
processes for measuring and managing risk,and the Society`s 3) Whether the relationship with a special purpose entity
indicates control of the Special Entity

Notes to the Financial Statement
2021 2020
Kshs. Kshs.
2. Revenue
Income from Sale of Land 868,572,406 317,179,522
Income from Housing Project 75,318,372 122,078,000
Income from Zaria 23,359,824 12,947,555
Agency Commission 8,599,102 884,925
Loss from Farming (3,274,838) -
Interest on Extended payment 579,608 15,830,468
973,154,474 437,871,534
3. Cost of Sales
Purchase of land and houses (604,389,814) (269,016,847)
(604,389,814) (269,016,847)
4. Interest Income
Interest on Fixed Deposits 12,996,708 4,274,708
Interest on Tenancy Purchase 3,243,980 2,994,443
16,240,688 7,269,151
5. Rental Income
Net Rental Income 5,138,904 1,591,079
6. Other Income
Project Exit Fee 2,135,505 4,352,275
Entrance Fees 1,063,885 2,139,101
Dividend income 1,350,147 2,078,887
Share Transfer Fees 326,334 688,989
Forex Gain 336,825 465,612
Gain on sale of Motor Vehicle 922,639 -
6,135,335 9,724,864
Gross Income 1,000,669,401 456,456,628
7. Administration Expenses
Internet Domain 6,442,570 6,907,062
2,550,683 3,752,102
2,473,546 2,562,311
Team building 3,853,700 1,535,685
Traveling & Subsistence 1,565,943 1,450,174
Motor Vehicle expenses 409,597 960,594
Software Maintenance 811,737 960,470
Postage 740,282 741,90
Printing and Stationery 1,337,109 610,454
20,185,167 19,480,761

2021 2020
Kshs. Kshs.
8. Personnel Expenses
Salaries and Wages 57,627,809 53,735,903
Staff Medical 9,340,832 9,784,850
Recruitment Expenses 462,840 543,467
Education and Training expenses 319,900 532,967
Modem Data Bundles 23,000 177,000
Performance Based Rewards to Staff 8,995,000 2,100,000
Professional Subscription 117,093 44,200
76,886,474 66,918,386
9. Financial Expenses
Bank Charges 3,263,256 1,579,132
Interest on Bank Loans 14,758,151 -
Interest on Member withdrawable Deposits (IED) 28,893,211
46,914,618 1,579,132
10. Professional Expenses
Consultancy/Legal Fees 20,651,865 8,634,447

Audit Fee and VAT 638,000 499,320
Supervision & Recoverable Expenses 55,200 -
21,345,065 9,133,767
11. Governance Expenses
Committee Expenses 8,465,860 7,736,079
AGM Expenses 1,944,800 1,500,000
Committee Education 714,500 712,800
11,125,160 9,948,879
12. Business Development
Marketing & Advertisement 9,451,902 16,205,338
Research & Development 2,473,142 1,470,635
Members Forum Expenses 117,208 611,403
Strategic Planning Expense 3,302,600 251,900
15,246,852 18,539,276
13. Provision for Prior Year Projects (HPL)

Historical Problematic Land Expenses 5,026,256 42,049,040
5,026,256 42,049,040
This relates to expenses that have been incurred on the problematic land issues
14. Depreciation and Amortisation

Depreciation 2,350,868 1,759,200
Amortisation 1,527,528 383,060
3,878,396 2,142,260

2021 2020
Kshs. Kshs.
15. Cash and Bank
Co-operative Bank - Current Account 45,297,441 70,332,564
Co-operative Bank - Savings Account 11,417,383 25,969,540
Co-op Bank Escrow Account ** 18,774,864 14,447,782
Mpesa Paybills 20,868,676 12,569,552
Sidian Bank 14,931,876 11,384,466
SACCO FOSA Account 6,810,611 9,411,016
Bank of Africa 44,744,992 7,029,090
Co-op Bank USD Account 9,462,949 518,232
Petty cash 275,428 201,437
172,584,220 151,863,679
16. Receivables and Prepayment

Zaria LLP 36,307,380 87,107,800
Prepaid Medical Insurance 4,068,672 2,252,676
Rent Receivable 78,361 1,337,610
Refundable Rent Deposits 450,000 450,000
Total Kenya - Motor vehicle Deposit 100,000 100,000
Prepaid Motor vehicle Insurance 112,027 20,555
41,116,439 91,268,641
17. Trade Receivables
Receivable within 1 year
Land 677,955,754 561,323,528
Housing 140,575,197 194,298,974
818,530,951 755,622,502
Receivable after 1 year
Land 24,828,434 258,914,184
Housing 117,749,020 219,523,584
142,577,454 478,437,768
Total 961,108,405 1,234,060,270

2021 2020
Kshs. Kshs.
18.
Kajiado County 708,395,509 557,055,472
Machakos County 376,020,188 286,777,898
Kiambu County 71,272,964 113,474,455
Makueni County 58,757,850 95,441,476
Kitui County 77,980,439 68,095,801
79,534,011 66,262,039
Nakuru County 33,988,913 31,550,967
Laikipia County 84,659,099 18,549,515
Kisumu County 99,524,636 15,891,690
Narok County 5,804,352 14,011,908
Siaya County 7,220,237 7,757,873
Kwale County 13,695,180 3,502,830
Uasin Gishu County 4,079,439 769,322
Kirinyaga County - 260,645
1,620,932,816 1,279,401,891
19. Housing Stock for Sale
Ruaka 48,649,759 59,489,073
Blue Bells 1 37,701,765 37,843,435
Kantafu Serene Homes 15,997,500 15,997,500
Kitisuru Garden Villas - 8,327,500
Blue Bells 2 37,694,849 5,243,311
140,043,873 126,900,818
20. Land held for Housing &Investment

Land held for Investment
Ruaka 2 66,895,400 66,895,400

Juja 1 6,190,980 6,190,980
Kitengela KCA 2,428,737 2,428,737
Land held For Housing

Ruaka III Housing 177,000,000 197,946,452
Boutique Hotel & Holiday Homes 175,500,000 188,096,700
Athi River Housing 108,046,000 108,046,000
Kiserian Shopping Mall / Apartments 28,174,000 28,174,000
Ngong Township 4,406,907 -
568,642,024 597,778,269

2021 2020
Kshs. Kshs.
21. Zaria LLP
Investment in Zaria LLP** 271,082,640 341,744,970
**Zaria is a joint venture project between SIC and Palm Ridge LTD that is located in Kiambu
County and which was initiated in 2019. The total project cost is Ksh 2b (being cost of land plus 271,082,640 341,744,970
infrastructure developed on it). SIC has invested Ksh 358M into the project. The Investment is
being amortised with every sale in the project and will eventually be zero when the project is sold
out.
22. Investment Top Farm Limited

Top Farm Limited 3,000,000 3,000,000
3,000,000 3,000,000
23. Agribusiness Investment

Land held for SIC farming 41,314,737 41,985,047
41,314,737 41,985,047
24. Other Financial Assets
Fixed Deposit account *** 129,638,818 161,323,337
CO-OP Trust Investment ** 24,731,233 23,381,087
African Alliance ** 10,876,046 9,633,227
CIC Group Shares ** 2,025,000 2,025,000
** Co-op Trust Investment, African Alliance and CIC Group shares are investment portfolio of
various listed company shares that earn dividends at end of the year.
167,271,097 196,362,651
*** The Fixed Deposit account is comprised of Faulu Bank (Ksh 11M) with a rate of return of
10.5% p.a,Bank of Africa (Ksh 85M) with a rate of return of 7.5% p.a, CIC Insurance Company (Ksh
16M) with a rate of return of 9.01% p.a and Britam Holdings (Ksh 16M) with a rate of return of
9.16% p.a
25 Property & Equipment Movement Schedule
Phones & Motor Furniture

Accessories Computers vehicle & Equipment Totals
Kshs. Kshs. Kshs. Kshs. Kshs.
Rate 33.30% 30.00% 25.00% 12.50%
Cost
At start of year 2,718,887 7,234,275 5,421,439 6,966,884 22,341,485
Additions/Disposal (net) - 930,438 1,997,061 173,600 3,101,099
At end of year 2,718,887- 8,164,713 7,418,500 7,140,484 25,442,584
Depreciation
At start of year 2,718,887 5,112,899 4,513,766 2,976,042 15,321,593
Adjustment - 280,999 (3,924,078) - (3,643,079
Charge for the Year 773,660 1,076,498 500,710 2,350,868
2,718,887- 6,167,558 1,666,186 3,476,752 14,029,383
Net Book Value

As at 31.12.21 - 1,997,155 5,752,314 3,663,732 11,413,201
As at 31.12.20 - 2,121,376 907,673 3,990,842 7,019,891

2021 2020
Kshs. Kshs.
26 Intangible Assets
Software
As at start of Year 20,093,805 1,276,865
Additions 3,439,326 19,200,000
(1,527,528) (383,060)
Amortization
At end of Year 22,005 603 20,093,805
27 Current Income Tax Payable

Opening Balance (10,195,883) (10,195,883)
Charge for the Year 4,872,206 -
Paid during the Year (1,451,203) -
Tax receivable (6,774,879) (10,195,883)
28 Deferred Cost of Sale 1,129,027,683 738,327,163

Deferred COS represents the total COS for units whose revenue is yet to be recognized . When
revenue is recognized for these units, we move the revenue amount from deferred revenue to
revenue (sales) and COS amount from the deferred COS to COS accounts.
29 Deferred Income
IFRS 15 958,439,347 874,054,842
Interest on Tenancy Purchase Scheme 35,638,781 38,927,761
Housing Income 51,631,175 25,826,740
1,045,754,303 938,809,343
30 Trade Payables
Zaria Provisions 54,007,046 224,123,316
Projects creditors 297,407,963 179,666,612
Agency Deposits 34,354,722 27,978,709
Trade creditors 77,784,039 16,042,396
IED & Pepea interest provisions 14,286,797 6,182,483
Deposits received 5,254,341 3,386,176
Audit Fees 319,000 499,320
Supervision & recoverable fees 55,200 -
AGM Expenses 1,997,511 1,854,338

Payroll Deductions 2,685,083 1,632,608
Accrued Expenses 699,868 750,000
12,900,000 2,000,000
501,751,570 464,115,958

2021 2020
Kshs. Kshs.
31 Proposed Rebates to Members -
Balance b/f 12,130,617

Paid during the year (12,130,617)
Proposed during the year 117,402,959 12,130,617
117,402,959 12,130,617
32 Interest Bearing Liabilities (Pepea, IED & Bank Loans)
Opening Balance 1,025,659,293 600,363,412

Receipts in the year 407,986,827 800,787,074
Payments (391,234,403) (375,491,193)
Closing Balance 1,042,411,717 1,025,659,293
33 Share Capital
Opening Balance 2,500,715,663 2,500,715,663
Additions During the Period 3,618,482 -
Capitalized Rebates - -
Closing Balance 2,504,334,145 2,500,715,663
34 Reserves
Statutory Reserve
Opening Balance 15,579,346 14,475,812
Provided During the Period 14,679,287 1,103,533
Closing Balance 30,258,633 15,579,345
Retained Earnings
Opening Balance (117,007,240) (59,510,485)
Proposed Honoraria (5,000,000) -
Prior Years Withdrawals (20,778,089) (61,910,888)
Retained Earnings for the Year 73,396,434 5,517,665
Transfer to Statutory Reserve (14,679,287) (1,103,533)
Closing Balance (84,068,182) (117,007,241)
(53,809,549) (101,427,896)
35 Contigent Liabilities
The Society is a defendant in the case of one ELCC/E173/2021-Catherine Kavata Musuva vs Safaricom Investment
Cooperative Society Limited and Via Ruling Delivered On 18th October 2021 it was done in favour Of Catherine
Kavata. The Society is obliged to pay the plaintiff a sum of Kshs 500,000 as at 31.12.2021
36 Currency Risk
The Society operates wholly in Kenya and its Assets and Liabilities are reported in the local currency. It therefore held
no significant foreign currency exposure during the period.
37 Comparatives
Where necessary, presentation in the previous year has been adjusted to match presentation in the current year.

Taxable Income Computation 2021
Kshs
Interest Rental
Business Income Farming Income Total
Surplus before tax 53,486,501 16,240,688 127,710 5,138,904 74,993,803
Add Depreciation 3,878,396 - - - 3,878,396
57,364,898 16,240,688 127,710 5,138,904 78,872,200
Less: Wear and Tear Allowance (1,893,774) - - - (1,893,774)

Software Allowance (4,800,000) - - - (4,800,000)
Farming Expenses - - (3,530,257) - (3,530,257)
Dividend Income (1,350,147) - - (1,350,147)
Share Transfer Fees (326,334) - - (326,334)
(336,825) - - (336,825)
Forex Gain
(922,639) - -
Gain on sale of Motor Vehicle (922,639)
Adjusted Taxable Income 47,735,179 16,240,688 (3,402,547) 5,138,904 65,712,224
Less: Taxable loss brought forward (72,032,860) - (1,792,929) (73,825,789)
Adjusted Taxable Loss/ Taxable Income (24,297,681) 16,240,688 5,195,476 5,138,904 (8,113,565)
Tax@30% - 4,872,206 4,872,206

Witholding taxes (1,451,203) (1,451,203)
Instalment taxes 2018 & 2019 (3,919,117) (3,919,117)
Tax-payable - (498,114) - 1,541,671 1,043,558
WEAR AND TEAR ALLOWANCE SCHEDULE

Motor Furnitures&
Total
Computers Vehicles Equipment
25% 25% 10.0%
KSH KSH KSH KSH
As at 1 January 2021 2,121,376 907,673 3,990,842 7,019,891
Additions 883,208 1,997,061 173,600 3,053,869
3,004,584 2,904,734 4,164,442 10,073,761
Wear and Tear 751,146 726,184 416,444 1,893,774
WDV as at 31 December 2021 2,253,438 2, 178,551 3,747,998 8,179,987
SOFTWARE ALLOWANCE (straight line basis)

2021
Original Cost 19,200,000
Balance B/Fwd 19,200,000
Allowance 25% (4,800,000)
Balance C/Fwd 14,400,000

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ANNUAL REPORT &

Amount 6 Months 7 - 12 Months

50,000 - 500,000 10.00% 10.50%

501,000 - 1,000,000 10.50% 11.00%

1,000,001 - 3,000,000 11.00% 11.50%

More than 3,000,000 11.50% 12.00%

With Pepea Fixed Deposit, you can keep

Management Committee Members 4

Pepea Fixed Deposit 28

Financial Report 2021

Statement of Financial Position 49

Statement of Changes in Equity 50

Taxable Income Computation 63

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 3

4 SAFARICOM INVESTMENT CO-OPERATIVE

Eng. Emily Kilongi

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 5

CPA Beth Wambui Mwangi

Sarah Wahogo is the current acting CEO at Safaricom Investment Co-operative.

6 SAFARICOM INVESTMENT CO-OPERATIVE

1. Customer is King - “There is only one boss. The customer,

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 7

8 SAFARICOM INVESTMENT CO-OPERATIVE

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 9

compounded by the requirements to have IFRS 15 compliant

Key Macro-economic Developments and Outlook

10 SAFARICOM INVESTMENT CO-OPERATIVE

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 11

2. Proposes that Board members indemnity be retained at

3. Proposes that the borrowing ceiling for the Society be

12 SAFARICOM INVESTMENT CO-OPERATIVE

Financial Performance Highlights

Revenue from Housing Projects Revenue from Land Projects

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 13

2019 2020 2021 2019 2020 2021

14,663 19,481 20,185 9,734 9,949 11,125

2019 2020 2021 2019 2020 2021

2019 2020 2021 Provision for 2019 2020 2021

2019 2020 2021 2019 2020 2021

2019 144,482.63 2020 169,791.50 2021 200,607.99

Net Net Cash and

2021 78.27m 39.2m 125.64m 172.5m

2020 31.92m (86.57)m 351.25m 151.8m

14 SAFARICOM INVESTMENT CO-OPERATIVE

Year 2015 2016 2017 2018 2019 2020 2021

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 15

16 SAFARICOM INVESTMENT CO-OPERATIVE

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2021 17

Introduction to Zaria village

Internal Cabro roads 4 options of scalable house designs

Provision for an education center

Solar Street Lighting Clubhouse, gym and restaurant

Jogging Track 25m Swimming pool with Kiddy Pool

payment payment 6 months 1 year

18 SAFARICOM INVESTMENT CO-OPERATIVE

Preparation of monthly update and annual financial reports.

Supervision of cleaning of common areas, Garbage & Sanitary disposal.

Supervision of security service providers.