Entrepreneurship copy 2

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• INTRODUCTION

  INTRODUCTION

  This textbook is part of school curriculum reform in Rwanda in particular how 
  the curriculum is taught.  It is hoped that this change will make what you learn 
  in school more useful both at school and when you leave school.
   In the past, the main reason for schooling was to obtain knowledge – that is 
  facts and ideas about each subject.  But nowadays the main reason  due to 
  changes that are happening in the environment and the job market is becoming 
  more competitive therefore you should be able to use the knowledge you 
  will obtain from this text book to develop competencies. These competencies 
  include, ability to think for yourself, ability to communicate with others and to 
  explain what you have learnt, as well as being creative in developing your own 
  ideas, not just following those of the Tutor and the textbook. In this textbook, 
  different approaches are used to help you to develop competences and make 
  this textbook user friendly. Among these approaches are the following: 
  
  Activity-based learning 
  These activities present you with instructions to follow that will help you to 
  learn and discover others for yourself. You already have knowledge and many 
  ideas based on the experiences you have had and your life within community. 
  Some of the activities, therefore, require you to use the knowledge and ideas 
  you already have.
  
   In using this book, therefore, it is essential that you do all the activities and 
  follow all the instructions. You will not learn very well unless you complete 
  these activities provided. They are the most important part of the Textbook.
   
  In some ways this makes learning more of a challenge.  It is usually challenging 
  to think for yourself than to copy what the Tutor tells you. But if you take up 
  this challenge you will become a better person and become more productive 
  and successful in your life.
   
  Group work
   You can also learn a lot from other people in your class. If you have a problem, 
  it can often be solved by sharing it with others. Many of the activities in the 
  book, therefore, involve discussion.  Your tutor will help to form and organize 
  these groups in a conducive learning environment facing each other. You cannot 
  discuss properly unless you are facing each other.
   
  Research
   One of the objectives of the new curriculum is to help you discover for yourself. 
  Some activities, therefore, require you to do research using Textbooks in 
  the library, the internet if your school has access, or any other source such 
  as newspapers and magazines etc. This means that you will develop skills 
  of learning for yourself that can help you both when still in school and after 
  school. Your tutor will help in case your school does not have a fully equipped 
  library or internet.
  
  Skills lab
   Entrepreneurship subject is more practical than theoretical that is why it 
  requires time for skills lab which is a regular time on normal time table when 
  student-teachers are required to complete learning activities working in 
  manageable groups. 
  
  During skills lab activity student-teachers are given an opportunity to talk 
  more and get more involved in the lesson than tutors. Student-teachers receive 
  constructive feedback on work done (Tutor gives quality feedback on student 
  presentations). 
  
  The Skills Lab prepares student-teachers to complete portfolio assignments on 
  their own after classes. So, classroom activity should connect directly to the 
  portfolio assignment and   during the skills lab the tutor makes sure that he/
   she links the unit with the portfolio assignment, student’s business club and 
  back home projects.
  
   Icons
   To guide you, each activity in the book is marked by a symbol or icon to show 
  you what kind of activity it is. The icons are as follows:
   This indicates thinking for yourself or groups discussion. You are expected to 
  use your own knowledge or experience, or think about what you have read in 
  the book, and answer questions individually or as a group activity.
   
   Thinking icon/Learning activity icon
   This icon reminds you to link your previous knowledge with the topic you 
  are going to learn. As a student feel free to express what you already know 
  about the topic. What is most important is not giving the right answer but the 
  contribution you are making towards what you are going to learn.
   
  Application Activity icon
  Some activities require you to complete them in your exercise book or any other 
  book. It is time for you to show if you have understood the lesson by answering 
  the questions provided. 
  
  Skills lab icon
   This icon indicates a practical activity, such as a role play to solve a problem or 
  complete an activity, participating in a debate and following the instructions 
  provided by the teacher. These activities will help you to obtain practical skills 
  which you can use even after school.
   
  End unit Assessment icon
   This icon requires you to write down the responses to activities including 
  experiments, case studies and other activities which assess the attainment 
  of the competences. Tutors are expected to observe the changes in you as a 
  

  student teacher.

• UNIT 1 : BUSINESS IDEAS AND OPPORTUNITIES

  

  Key Unit Competence: To be able to generate viable business ideas.
  Introductory activity
  

  Analyze the photo below and answer the following questions

  
  

  Observe the picture above and identify different sources of business 
  ideas.
   1. Generate different business ideas from the above environment.
   2. Notall business ideas are business opportunities. Is this statement true or 
  false? Give reasons to justify your response.
   
  1.1 Business, business idea and a business opportunity
   1.1.1. Meaning of a business idea
  Business refers to any economic activity that involves the production, selling 
  of goods and services, covering risks with the aim of getting profits.
  
  An idea is called an opportunity if there is evidence that the entrepreneur’s 
  idea can be turned into reality.
  
  A business idea simply refers to any thought that the entrepreneur may 
  come up with as a result of scanning the environment with the possibility 
  of developing it into a business opportunity. It requires the entrepreneur to 
  exercise creativity and innovativeness in order to come up with the successful 
  business ideas for the environment. 
  
  Examples of business ideas in Rwanda include; Real estate, clothing and 
  textiles, food processing, E-Commerce, technology products.
   
  1.1.2. Meaning of a business opportunity
   A business opportunity can be defined as an identified situation or chance 
  that can be turned into a real and profitable business.
  
  An opportunity is a favorable set of circumstances that creates a need for a new 
  product, service, or business. Such opportunities are determined by customer 
  requirements and lead to the provision of a product or service which creates or 
  adds value for its buyers or end-users.
  
  A business opportunity is any situation that can be turned into a possible and 
  profitable business activity. 
  
  An opportunity is a situation in which it is possible for you to do something 
  that you want to do. A business opportunity is said to be viable, when it has the 
  ability to grow and expand.
  
   Examples of business opportunity and their   business idea
   -Lack of sufficient safe water in your community is a business opportunity. 
  Provision of JIBU, NIL, AKANDI or INYANGE water can be a business ideas.
   
  -High demand for charcoal as a source of energy in your community is 
  business opportunity.  For that opportunity, many business ideas can be 
  generated like provision cooking gas, making charcoal in wastes, planting 
  trees, buying big vehicle to transport charcoal from far forest…
  
  A business idea may not necessarily be a profitable business opportunity; one 
  needs to filter and sift through these ideas to realize whether they are real 
  

  opportunities.

   Application Activity 1.1
  

   Case study: A reality T.V. Show

  

  Rwiyemeza is a prominent entrepreneur dealing in growing and 
  processing of Mushrooms in Kicukiro district. One day she was invited 
  to give an interview on Rwanda Broadcasting Agency (RBA) about her 
  business to the whole nation by Mr. Makuru. 
  
  Read through the excerpts from the interview 
  Makuru: How did you decide to get into mushroom growing and 
  processing? How did you start?
  
  Rwiyemeza: It was during my school time when I joined a school 
  business club. I got the idea when our club mentor told us that we can 
  

  start a backhome.

  business, we used to call it a ‘BHB’. I introduced the idea to my parents 
  and I was lucky that they supported me. It was not a very easy task with 
  everyone telling me different things about growing mushrooms. Actually 
  many people that I talked to focused on the challenges but about three 
  people told me that I can overcome the challenges if I plan in advance. 
  I therefore decided to take on the business of Mushroom growing and 
  processing.
  
  Makuru: What was the biggest challenge while starting your Mushroom 
  business? How did you overcome it?
  
  Rwiyemeza: There were so many challenges such as unsure market, 
  competition, pests, but deciding on turning my business idea into a 
  profitable business was most challenging. I had to make a lot of research 
  from existing entrepreneurs,  sector offices, and financial institutions. 
  I also had to do personal evaluation. I found that I could market my 
  product very widely to beat the market problem, and ensure much 
  cleanliness and timely watering to avoid pests. 
  
  Makuru: What are the benefits of your business to the community?
  
  Rwiyemeza:  Apart from earning a living for me and my family,  my 
  business employs three ladies and 2 gentlemen who earn a monthly 
  salary. Important to note also, is that I have inspired a lot of other young 
  entrepreneurs especially women to start their own businesses.
  
  Makuru: What advice would you give to the young people who may 
  want to start businesses? 
  
  Rwiyemeza: My advice would be that all around us are opportunities 
  of business ideas but one has to be careful because NOT all business 
  ideas can be turned into profitable businesses. Before I finally decided 
  to start mushroom growing and processing, I had tried a number of 
  business ideas which failed because they were not viable. So, I again 
  advise the young people to take time and research  about the business 
  ideas before investing money since “Not all business ideas are business 
  

  opportunities”.

   Questions:
   Referring to the case study (A reality T.V. Show) above, answer the 
  following questions:
  

  
  a) What do you understand by a business and what is Rwiyemeza’s 
  

  business?
   
  b) Explain what you understand by a business idea. Mention any 
  sources of business ideas for Rwiyemeza’s business activity.
  
  c) Rwiyemeza says it was not easy for her to start up the business 
  activity. Explain what you understand by a business opportunity 
  and identify some challenges Rwiyemeza faced.
   
  d) Why do you think it is very important to do a research and personal 
  evaluation before deciding to start a business activity?
   
  e) Looking at the situation at school and in your home community, 
  what two best business ideas can you possibly take on? Why do 
  

  you think those two are the most viable ones?

   1.2. Reasons for generating business ideas
   Activity 1.2
   1) Why do you think that it is important to generate business ideas?
   2) In your own words, explain why the following Entreprises Urwibutso, 
  

  Inyange, Mara phone, Volkswagen  have been generated. 

  

  The simplest purpose of business is to solve a customer’s problem or meet 
  the customers’ needs. By providing the goods and services that meet the 
  customer’s needs, the business owner may realize profits. Businesses exist to 
  impact on people’s lives. This happens by businesses providing people with 
  goods and services they desire to meet their needs. While the people buying the 
  business’ products (goods and services) are meeting their needs, the business 
  owners expect to realize profits. Businesses serve as conductors of economic 
  

  activity and development.

  Business may be done by private individuals, government, companies, co
  

  operatives or non-governmental organizations (popularly known as NGOs).

   Hereafter are many reasons why entrepreneurs would need to generate 
  

  business ideas:

  To start a sustainable business: a good idea is essential for a successful 
  business venture – both when starting a new business or expanding it.
  
  To respond to market needs: markets are made up essentially of 
  customers who have needs and wants waiting to be satisfied.
   To meet changing fashions and requirements: provide opportunities 
  for entrepreneurs to respond to demand with new ideas, products and 
  services.
  
  To stay ahead of the competition: Remember, if you do not come up 
  with new ideas, products and services, a competitor will. So the challenge 
  is to be different or better than others.
  
  To exploit technology – do things better: Technology has become a major 
  competitive tool in today’s markets and for one to be better with changing 
  technology, generation of business ideas is crucial.
  
  Because of product life cycle: All products have a finite life. The firm’s 
  prosperity and growth depends on its ability to introduce new products 
  and to manage their growth.
  
  To diversify risks and overcome failure: It is necessary for firms to try 
  to diversify their risks and overcome failures that may occur from time to 
  

  time by constantly generating new ideas.

   Application Activity 1.2
   Identify a number of different needs and wants in your community 
  that are not yet being met by the existing businesses and suggest the 
  business you would come up with.
  

  
  

   1.3 Sources of Business Ideas.
   Activity 1.3
   Referring to your community and beyond, explain at least 5 business 
  ideas that you can generate from the different sources.
  The following are some of the sources of business ideas:
   
  -Looking within you and examining skills, talent and passion: The very 
  first place to start looking for business ideas and opportunities is to look 
  within yourself. Self-examination is an important thing that can help in 
  reaching to different decisions. It is important to examine your own skills, 
  talent or passion that can fit into the business. Therefore, such businesses, 
  which corresponds according to your skills is the most appropriate and 
  

  are expected to be successful in the future. 

  -Inventing a new product or service: Another great source of business 
  opportunity is inventing a new product or service. Different people are 
  creative with a mindset of thinking out of the box and solving problems 
  with the best appropriate solution. One needs to think like great 
  entrepreneurs such as   SINA Gerald of Urwibutso enterprise, Zulphat 
  Mukarubega proprietor of Rwanda Tourism University College, etc. 
  However, for winning ideas you need to be specific on your target market 
  

  and analyse the problem.

   -Adding value to an existing product(Innovation): Rather than inventing 
  a product, one can also add value to existing products. These kinds of 
  innovations can be proved as a great source of business opportunities. 
  Since most of the inventions have already taken place, so it is prevailing 
  

  as innovation.

  -Franchising: A continuing relationship in which a franchisor provides a 
  licensed privilege to the franchisee to do business and offers assistance 
  in organizing, training, merchandising, marketing and managing in 
  return for a monetary consideration. Franchising is a form of business 
  by which the owner (franchisor) of a product, service or method obtains  
  

  distribution through affiliated dealer (franchisees).

   By looking on the demographics and the need for a particular service or 
  product, one can also start a franchising business. It can be really profitable 
  since much of business modeling is not required because a person uses 
  

  the rights of another retailer.

  Mass Media: Mass media has become comprehensive from past few 
  years. Magazines, TV, Newspapers etc. are a great source of ideas and 
  opportunities. Different businesses are on sale and different commercial 
  advertisements are available to choose from.
  
  Attending Exhibitions: Trade shows and Expos helps to develop a strong 
  

  business network.

  Industrial Survey: Another important source for a business ideas can 
  be industrial surveys. Since, the main point of a business is to fulfill the 
  needs of a customer. Therefore, surveying and analyzing the underlying 
  need of a customer can help in reaching a rational decision that addresses 
  

  the customer’s problem and result in a profitable business.

  Listening to customer complaints: Complaints are a part of customers’ 
  relationship that led into the development of new or improved products 
  and services. Whenever customers report badly, it means that the 
  customer satisfaction is not being achieved and there is some issues 
  with the product.  This can help in generating new business ideas for 
  

  addressing problems of customers.

   Application Activity 1.3
   Describe the qualities of a good business idea in your home community 
  

  that can be turned into a Back-Home Business.

   1.4. Steps of generating business ideas 
  Activity 1.4
   Referring to your community and beyond, explain at least 5 business 
  ideas that you can generate from the different sources.
  a. What would you have to do in order to take on the best business 
  opportunity?
  
  b. Would you advise a friend on how to assess business ideas and 
  

  opportunities? If yes, how? If not, what would you do?

   1. Start thinking/get your brain at work
   The first thing to do when you get a business idea is determine whether it’s 
  a good idea. Not every idea that seems good at first is practical. And some 
  business ideas have no market.
  
  You will need to do some research to evaluate your business idea. Here is a 
  checklist of questions to use as a guide:
   -Is there a need for this product or service? Some of the most popular 
  products and services meet a need that people currently have. The 
  product or service may improve upon or complement an existing product 
  or service, or your idea may be a completely new approach to meeting a 
  need.
  
  -Is there a desire for this product or service? Admittedly, some of the 
  most popular products are desire-based rather than need-based. That 
  means that someone is purchasing the product because they want to. A 
  few needs-based reasons for a purchase include to increase status or to 
  follow a trend.
  
  -Who is currently meeting the need for this product or 
  service? Answering this question gives you a start on evaluating your 
  competition. You need to know not only who your competitors are, but 
  also how many are they? Don’t forget to consider indirect competition.
   
  -Who will buy this product or service? Find out who your typical 
  customer is likely to be. This may involve conducting surveys, testing the 
  waters, finding a focus group, and more. The better your understanding 
  your potential customer, the more likely you are to create a successful 
  business.
  
  -How big is that market? You may have a great business idea. It may even 
  be brilliant. But, if the market for your idea is very small, your business 
  might not be viable–that is unless people are willing to pay a premium for 
  your product or service. This  brings us to the next question.
  
  -How much are people willing to pay for your product or service? Your 
  intake from your product or service needs to cover your costs and should 
  include a healthy profit. Remember, that even a small niche market can 
  be profitable if potential customers are willing to pay you enough money.
  
  -How hard will it be to implement the idea? Let’s face it, some ideas 
  are easier to implement than others. When answering this question, take 
  into consideration the amount of time it will take you to launch your 
  business as well as whether or not you will need to hire someone to help. 
  After doing your research, you should be able to tell whether you want to 
  

  continue on ,and develop your business idea.

  

   2. Buy a notebook (Think on paper)
   Now that you know how to stimulate your brain and get started with the creative 
  thinking process, you need to keep count on your ideas and make sure that you 
  can document them to study and examine them further. Every business you 
  can think of started with a small idea somewhere, from a small observations, 
  a frustrating situation, or while taking a shower. You never know when the 
  inspiration comes, so keep a notebook close to you at all times to write these 
  

  ideas down whenever they come.

   3. Follow your passion
   Once you start your business, you will spend most of your day for several 
  years doing that business. So make sure you choose a business that you feel 
  passionate and excited about. If you don’t like the business you are doing , you 
  might not succeed in that business, probably not because you don’t have what 
  it takes, but mostly because you might lose interest too easily in the face of the 
  

  challenges that will come your way.

   4. Keep your eyes open
   New business opportunities get born from new situations every day. Keep an 
  eye on what is happening around you, make it a habit to read the newspaper 
  and identify new opportunities. You may read that people are complaining from 
  poor health services in your area, or the lack of schools in your neighborhood. 
  Talk to your neighbors and the people you know, what is frustrating them? 
  What would they want to change in your neighborhood? Is your neighbor 
  complaining that he/she needs to drive long distances to get to the nearest dry 
  cleaner? Or is your other neighbor complaining about the lack of groceries in 
  close proximity to where you live? Are your coworkers frustrated that there are 
  

  no restaurants close to your work building?

   5. Capitalize on your strengths
   Most people are good at something. Look at your experiences and career, what 
  is it that you can do well? Have you been working in project management for 15 
  years and know the ins and outs of the business, this is often the best place to 
  start. Instead of focusing on the things you cannot do well, focus on the things 
  you are good at. What can you do better than others? How are the others doing 
  

  it? And how can you do it differently? 

  6. Explore new things
   As mentioned earlier, change is one of the biggest stimulators to the brain. Even 
  if you don’t want to open your own coffee shop, next time you are in one, look 
  at how things are done and think of new ways to improve it. Often this thinking 
  might lead you to new ways to improve on your business ideas in your chosen 
  

  field.

   7. Check your bank account
   Starting and running your business requires money. Depending on your 
  situation, you need to think of businesses that suit your budget. Everyone’s 
  finances are limited, so make sure whatever business idea you come up with is 
  doable. If you have a small amount of money, then look into business ideas that 
  

  are not cash hungry, maybe start small and then grow with the business.

   8. Know what you want in life
   Aside from your business goals, think about the reasons why you want to start 
  a business in the first place. What is it that you are looking for? What are your 
  goals in life? Are you starting a business to be able to spend more time with 
  your family? To make more money? To be respected among your peers?
  
  Whatever your goals are, make sure that your business idea complements these 
  goals and help you to achieve them. If your goal is to find more time to spend 
  with your family and do other things, then starting a business that requires you 
  

  to work 16 hours a day or travel constantly might not be the best idea.

   9. Choose a business that suits your personality.
   Are you a morning person or a night creature? Each person has his/her own 
  peak hours of the day. You will find very few successful bakers or newspaper 
  owners that don’t like to wake up in the morning. If you are not a morning 
  person, avoid businesses that will need you to work in the early hours of 
  the morning. If you are a night person, then maybe running a nightclub or a 
  restaurant that stays open till late hours is more suitable for you. Conversely, if 
  you sleep early, running a business that requires you to stay late might not be 
  suitable for you.
  
  Are you an indoor or outdoor person? Do you like working in an office for long 
  hours or can’t stand the office and feel that you need on the move all the time? 
  If you like the office quiet environment, then pick a business that can be done 
  from an office. If you like to be on the move, pick a business that requires you to 
  go to different places and meet new people.
  
  Are you brainy or handy person? People do things differently, some people like 
  to do things that involve thinking and working their brains, other people like to 
  do things that involve craftsmanship and handy work.
   
  Are you shy or outgoing person? If you are a shy person, then becoming a public 
  speaker might not be the best idea for you. If you are an outgoing person and 
  like to meet new people all the time, having an internet based business might 
  deprive you from that joy.
   
  I think you get the idea, think of your personal traits and attributes and pick a 
  

  business idea that suits your personality.

   10. Read about other people that started their own business
   A large part of becoming successful involves looking at other successful people 
  and learning how they achieved their success. Reading autobiographies about 
  prominent and successful business figures and learning how they started their 
  journey will give you great insight on how they did things and what exactly they 
  did to become successful.
  
  You find that most of them started from nothing. Many of them failed in 
  several businesses and had to listen to people that told them they will never be 
  successful. But they stood up and tried again and again until they succeeded. It 
  is not whether you fail that makes you the man you are, it is how you stand up 
  after the fall.
  
  Study their characters, what do successful entrepreneurs have in common? 
  How did they achieve their vision? What challenges did they have to overcome? 
  Look for similarities between their stories and your situation right now. You 
  will find that it is a great source of inspiration and motivation. If others just like 
  

  you did it, then you can do it too.

   1.5 Business opportunities
   Activity 1.5
   1) What do you understand by a viable business opportunity? 
  2) What business opportunities can you think of? Among those, which 
  

  ones are viable for you and why?

   1.5.1. Meaning of business opportunities
   A business opportunity can be defined as an identified situation or chance 
  that can be turned into a real and profitable business.
   An opportunity is a favorable set of circumstances that creates a need for a new 
  product, service, or business. Such opportunities are determined by customer 
  requirements and lead to the provision of a product or service which creates or 
  adds value for its buyers or end-users.
   A business opportunity is any situation that can be turned into a possible and 
  

  profitable business activity. 

  1.5. 2. Characteristics of a good business opportunity

   1. Demand
   Demand is the first thing that one ought to take into account before planning 
  to start a business is to ask themselves where there is a significant demand for 
  the particular product or services they intend to launch i.e. is there a gap in the 
  market? If the answer is NO then that idea isn’t a viable business opportunity. It 
  would also be profitable to target a specific niche as this increases the chances 
  

  of you becoming a dominant player for that specific niche.

   2. Return On Investment (ROI)
   If the business opportunity you have in mind has the potential of bearing fruits 
  within a set period of time and which can cover the capital that was used in 
  addition to bearing profits there is a high chance that you have got a winner 
  but if it only requires more and more capital to be injected in with minimal 
  or no possibility of having any returns any time soon then you ought to tread 
  

  carefully.

   3. Availability of resources
   You should have all the resources needed to take advantage of that particular 
  business opportunity as well as a time frame for implementing it, lest someone 
  

  else beats you to it.

   4. Skill
   You need to have the experience required to tap into that particular business 
  opportunity e.g. if you want to start a bakery but don’t know a thing about 
  baking ,then that is not a viable business opportunity. It is therefore important 
  that you have the required skill i.e. experience and expertise, for the business 
  

  you would like to start.

   5. Scalability
   Can the business grow gradually within a given period of time and can it adapt 
  to the changing times i.e. is it flexible enough? If the answer is NO then that idea 
  

  isn’t a viable business opportunity.

   6. Healthy Profit Margin
   Does the business have a good profit margin that will ensure the business 
  remains profitable even as it meets the gap in the market? If the answer is NO 
  

  and you’re not in it for charity then that idea isn’t a viable business opportunity.

   7. Customer Retention
   It’s said that customers are the lifeblood of any business but if you can’t retain 
  your customers then your business won’t last very long. You therefore need to 
  put in place mechanisms that will ensure you prolong your customers stay with 
  

  you i.e. that they will keep buying from you for as long as possible.

   8. Low capital requirement
   A good business opportunity should be cheap to finance. Access to capital is a 
  major obstacle to entrepreneurship implying that entrepreneurs should focus 
  on ideas that are cheap to finance. Entrepreneurs exploit financing methods 
  such as loans, venture capitalists and contributions from friends and family 
  among others. Capital suppliers are reluctant to finance new businesses with 
  

  huge capital requirements.

   9. Aligns with your passion
   A good business opportunity is one that aligns with the individual’s passion. 
  The founder’s motivation is a key determinant of the success of a start-up. 
  A passionate founder has an internal motivation towards building a bright 
  
  future for the business. If you are like this leader, you will create a clear vision 
  and mission statements and use them to motivate stakeholders towards the 
  

  organizational goals.

   Application Activity 1.5
   Suggest a project you need to start in your students business club and 
  

  identify the requirements you need to start your project.

   1.6. Factors to consider when generating and evaluating 
  viable business ideas and opportunities  
  Activity 1.6
   1) What do you understand by a viable business opportunity? 
  2) What business opportunities can you think of? Among those, which 
  ones are viable for you and why?
   
  Discuss different ways in which you can use to learn about existing business 
  ideas and opportunities both in your community and elsewhere. 
  
  It is very important to examine and evaluate your business opportunity 
  and determine your potential for success before you spend time and money 
  developing a business plan.
  
  Entrepreneurs need to determine whether the business opportunity they 
  have identified is viable or not. When evaluating the viability of the business 
  

  opportunity, the following factors need to be taken into consideration:

   1. Market
   Business evaluation process goes through analyzing the market. If there isn’t a 
  big enough market for your product or service, you should rethink whether this 
  business opportunity makes sense.
   • Who will be your target consumer?
   • Is there a need for your business idea?
  

   • Can you meet that  market need?

  For instance, you might think of a great business idea to produce a carbonated 
  beverage flavored with roots, berries, and other natural flavors.
  
  However, in your evaluation you might find that this type of product is already 
  saturated in the market. The idea is good and a market exists, but if the market 
  

  is flooded with competitors it would not likely be profitable.

   2. Business plan
   The bottom line of any business is to make money. Without positive cash flow, 
  you won’t succeed. Business owners with the best of intentions often fail 
  because the financial potential isn’t big enough.
   • Will there be sufficient financial reward?
   • Do you see a potentially growing market for the product?
   • Do you have others who believe in your business ideas?
   • Are there other businesses that are similar (which is a validation that 
  this potential business opportunity could be worth pursuing)?
   You as an entrepreneur have a lot of thinking to do. Come up with great business 
  ideas. Be creative and get enthusiastic about your ideas. However, always take 
  the time to plan for a sound business because the better the business plan, the 
  

  higher chances for your idea to succeed.

   3.  Technology and other requirements
   The business should be evaluated in terms of whether there is an appropriate 
  technology that can be used in production. Factors to be looked into include;
   Appropriateness of the technology, the cost of the technology, the possibility 
  of the business suffering in case the technology becomes outdated/obsolete, 
  

  availability of raw materials and other resources.

  4. Infrastructure
   Easy access to infrastructure such as roads, water, electricity, telephone and 
  postal services among others enables business enterprises easily make orders 
  for goods and deliver them hence reducing operating expenses. With low 
  

  operating expenses, profits can be maximized.

   5. Government policy
   An entrepreneur should consider the requirements of the government before 
  starting a business e.g. the government may require certain businesses to be 
  

  located in certain areas only.

   6. Amount of capital required
   The capital required to run and maintain the business should be considered i.e 
  

  the source of capital.

   7. Security
  

   Availability of security should be considered.

   8. Impact of the business operations on the environment
   Some business operations on the environment lead to environmental 
  degradation and should be located in appropriate environment.
   Are the political, economic, geographical, legal, and regulatory contexts 
  favorable? Will the business do any damage to the physical environment?
   The above questions are typical of the type of issues that need to be addressed. 
  Responses to these questions will determine the attractiveness of any business 
  

  opportunity.

   9. Competition and competitive advantage
   Competition is regarded as a threat to business of similar kinds operating in a 
  similar location. Although competition is a threat, it is healthy in the sense that 
  it goes along the way in controlling the price of goods offered. It is crucial for 
  entrepreneurs to consider opportunities where competition is not high as this 
  

  will enable them to get reasonable market.

   10. Length of the window of opportunity
   For example, one may inform you of an upcoming workshop for educators in 
  your area, you realize that there is an opportunity for you to supply water, 
  food and airtime among others, but for you to determine whether you should 
  invest in this, you need to know how many people are coming, the length of the 
  workshop, such that you know how much stock is needed, you also base on that 
  

  to determine whether you will get back your money or not

  Application Activity 1.6
  

   Analyze the photo below and answer the questions that follow;

  

   1) What kind of activity is represented in the photo?
   2) What are the effects of such business ideas to the community?
   3) As an entrepreneur, suggest any two business ideas you may 
  generate in response to the effects of the activity above.
   4) Picking one idea, give the factors you will base on while choosing 
  that idea.
   5) What advice would you give to potential entrepreneurs while 
  

  generating business ideas in relation to the photo above?

   Skills lab
   Choose 2 businesses/ business ideas and conduct a viability test to 
  find out which one is better in terms of; 1. Potential for growth, 2. 
  Infrastructure, 3. Market for the goods/services (real demand), 
  

  4. Profitability, 5. Competition and competitive advantage, 6. 
  

  Financial viability. Make posters indicating how each of the above 
  

  factors favors or limits their business ideas with clear examples. 
  

  Recommend the most viable business ideas the Business club should 
  

  continue/ start running basing on the results of the viability tests and 
  

  suggest action steps for the implementation.

   End of unit 1 Assessment
   1. Read the following scenario:
   Mr. and Mrs. Kaberu visited their friend Kambanda who lives in Kigali. 
  They were surprised to see how Kambanda’s business of Coca-Cola 
  wholesaling was booming. They didn’t even ask him how and why he 
  chose to do that business. 
  When they went back home in Nyagatare, they sold all their cows and 
  opened  x because they were kept for long. The landlord chased them 
  out of the house because they couldn’t pay rent any more.
   Out of frustration, Mr. Kaberu had to sell all his stock at half price because 
  he had nowhere else to keep them. On hearing this, his wife Mrs. Kaberu 
  cried the whole day and night to the extent that she collapsed and was 
  taken to the hospital at the mercy of the neighbours because her and 
  

  her husband couldn’t afford the medical bills.

   Questions
   a) Explain whether the business idea was good or bad.
   b) Write a letter to Mr. and Mrs. Kaberu advising them on the importance 
  of assessing a business idea or opportunity in case they have another 
  

  one.

   2. There are many business opportunities that we can get from our 
  communities, why should we always assess a business opportunity 
  before investing our resources and time? To answer this, discuss in 
  your groups and raise at least 5 business opportunities that you can 
  think of. Assess each one of them and choose the best two viable 
  

  ones which you will present to the class.

• UNIT 2: DRAFTING A VALID BUSINESS CONTRACT

  

  Key Unit Competence: To be able to make a valid contract in business 
  

  operations.

  Introductory activity

  Sam met with a businessperson on a football match who requested him to be 
  supplied with beans at a price of 500 Frws per kilogram. When Sam delivered 
  200kgs, he was not paid the full amount of money they had agreed upon.
   
  a) Has such a situation ever happened to you? When and what happened?
  b) What mistake did Sam do?
  c) Assume you were the one in such a situation, what would you do?
  d) What advice would you give to Sam and the businessperson?
  

  e) What lessons do you learn from the above situation?

  2.1. Meaning and Forms of Business contracts
   Activity 2.1
  Bayigana operates a small medium enterprise in Huye and wants 
  Ishimwe to supply his business with goods. Bayigana tells her to start 
  right away and supply the goods they will discuss other issues later. 
  She insists that she needs an agreement between the two especially on 
  issues of price, mode of payment, delivery period, quantity and quality, 
  among others.
   a) How do you call an agreement that Ishimwe insists to be between them?
   b) Do you think she is right to have the agreement before starting the 
  supply of goods? Give reasons to support your answer.
  c) In which way/form may the agreement be made between the two? 
  Support your answer
  

  d) What do you understand by the term contract and business contract?

  2.1.1 Meaning of contract and Business contract

  
  

  A contract is a legally binding agreement between two or more parties which 
  can be enforced by law.
   
  Example in marriage the woman and man make a contract during civil marriage. 
  The three parties are woman, man and witness will come to testify before the 
  

  law represented by Executive secretary of sector. 

  Before starting a job, the employer and employee make a contract. In this case 
  there are two main parties and the law  is now represented by official labor law 
  because it is not possible to make a job contract which is against the labor law.   
  
  A business contract is a legal binding between two or more persons/ entities  
  to perform an agreed business transaction and can be enforced by law. The 
  day today running of the business involves making contractual obligations with 
  

  suppliers, buyers etc. 

  Example: A farmer can make a contract of supplying   chicken to the hotel. In 
  most cases this contract is written and two parties should sign to that document. 
  This contract should follow the official law like the right person who represents 
  the hotel and the farmer should have maturity age. The two parties should sign 
  with free consent.  Once signed it becomes a document which binds the two 
  

  parties. 

  2.1.2 Forms of business contracts 
  Oral contract is an agreement between two or more parties by use of words. 
  They are non-written contracts. They rely on the good faith of the parties but 
  can be difficult to prove. Once the contract is verbal, the wittiness is mandatory 
  

  and provides evidence.

  Application Activity 2.1
  Read the following statements and answer the questions that follow:
  - Nkusi wants to lend his car to Niragire for 5,000Frw per day for 
  five days.
   -Niragire agrees with a handshake to borrow the car from Nkusi 
  and pay the money in witness of Rukundo.
  -Ntezimana promises to take his girlfriend Bagirishya for an outing 
  to Lake  Kivu.
  -Niyokwizerwa promises to pay 10,000Frw to whoever finds her lost phone.
  -Gato puts on paper his commitment to provide printing services 
  to Umutoni on agreed terms.
  -Mutesi promises to pay for her brother’s school fees and puts it in 
  

  writing.

  Which of the above statements are?
   a) Contracts.
   b) Not contracts.
  

   c) Business contracts.

  2.2 Valid contract
  

   2.2.1. Parties to a contract

   Activity 2.2

  1) Analyze the figure below and answer the following questions.

  
  

   a) Do you think the above sample is a contract? Give reasons to 
  support your answer.
   b) Name the key elements of the written contract above.
   c) Do you think the sample above is a valid contract? Support your 
  response by mentioning the elements of a valid contract in the 
  sample provided. (If any?)
   2) Describe different parties to a valid contract.
   3) Kamaliza’s 16-years old son, who looks a bit older, he signed a 
  contract joining a health club. He has dues of 15000 Frws. Is this 
  

  contract valid? 

  Parties of contract are persons who can sign the contract. For a contract to be 
  considered valid, it should include three parties. These are; Offeror/promisor 
  who makes an offer, Offeree/promisee to whom an offer is made and Witness 
  

  who sees an event happening.

  For example, in the above template Mr. John Muhire Offeror/promisor agrees 
  

  to sell his  car  to Umugwaneza Nadine Offeree/promisee  at 2 millions.

   Two parties to contract Offeror/promisor and Offeree/promisee must have 
  “capacity”, legal ability to make valid contract. Assent of parties is a must. If 
  either party is deprived, use of his understanding or deemed by law not have 
  attained consent, then such an agreement shall not bind him. All parties should 
  

  have should be mature, sound mind and qualified for contract by law.

  The information of two parties in contract should be clear, complete and 
  concise. In any case, the names are not enough, it should be better to include 
  other information like number of identification card, the location where those 
  documents are issued. Ensure that all information is well reflected on the 
  contract. For example in above contract there is a mistake in writing names. 
  Umugwaneza Nadine who sells the car is not the same Mugwaneza Nadine who 
  

  signs the contract. These slit mistakes can disqualify the contract.

   Witness is a person who sees an event happening. In a legal contract, a witness 
  is someone who watches the document be signed by the person they are being 
  a witness for and who verifies its authenticity by signing their own name on the 
  document as well. However, if you have a legal document such as a mortgage or 
  a Will the chances are that you will want a witness to attest to your signature. 
  Generally, the person you choose to witness a document should have no financial 
  

  or other interest in an agreement. A neutral third party is the best choice.

  

   2.2.2. Elements of a valid contract
   For a contract to be valid and therefore enforceable by law, it must have the 
  following elements:
  
  Intention to be bound by the contract: the two parties should have intended 
  that their agreement be legal. Domestic agreements between husband and wife 
  are not taken as valid
  
  Offer and acceptance: there must be an offer and the two parties must lawfully 
  come to acceptance leading to a valid contract. Until an offer is accepted, it’s not 
  a valid contract
  
  Consideration/price: this is the price agreed upon by the parties to the 
  contract and paid by one party for the benefit received or promise of the other 
  parties.
  
   Capacity of the parties: the parties to the contract must have contractual 
  capacity for the contract to be valid, i.e. should be sober, above 18years, not 
  bankrupt, not insane, properly registered.
  
  Free Consent: parties to the contract must agree freely without any of the 
  parties being forced to accept or enter the contract.
   
  Legality/lawful object: the object and the consideration of the contract must 
  be legal and not contrary to the law and public policy.
  
  Possibility of performance: if the contract is impossible to be executed in 
  itself either physically or legally, then such contract is not valid and cannot be 
  enforced by law.
  
  Certainty: the terms of the contract must be clear and understandable for a 
  contract to be valid. If the terms are vague or ambiguous, where even the court 
  

  may not be able to tell what the parties agreed, then it will be declared invalid.

   Application Activity 2.2
   Imagine if you make a contract without considering the elements of a 
  

  valid contract, what will happen if the person/ business refuses to pay?

  2.3. Importance of business contracts
   Activity 2.3
   Why is it essential to prepare business contracts?
   Referring to the activities in the previous lessons, do you think it is 
  important to have contracts in business operations? Give reasons to 
  

  support your answer.

  

  In business life, contracts are important because they outline expectations 
  for both parties, protect both parties if those expectations aren›t met and lock 
  in the price that will be paid for services. There are so many relationships that 
  affect the way the business operates such as customers or clients, employees, 
  suppliers, government, financiers.  Contracts are then important in the following 
  

  ways:

  - Contracts reduce business risks by compelling business partners to 
  perform what they have agreed to as per contract.
   
  - Business contracts specify terms and conditions of business 
  transactions including price, quantities, quality, date of delivery, etc. 
  which avoids misunderstandings.
  
  -Contracts help entrepreneurs to get the goods on credit because 
  the suppliers are aware that the entrepreneur is bound by contract and 
  therefore will make effort to pay the agreed amount.
  
  -Written contracts act as evidences. They are important because it is easy 
  to forget details you have agreed upon verbally and therefore provide a 
  

  permanent record.

  -Contracts may be used by entrepreneurs to convince bankers that the 
  entrepreneur has a business that will generate income so as to obtain 
  

  loans.

   Application Activity 2.3
   Demonstrate the importance of business contracts to the school 
  

  business club.

  2.4 Designing a contract sample 
  Activity 2.4
  

   Prepare a sample contract with suppliers for your school business club.

   2.4.1 Sample of Employee contract
   Employee Contract Template:
   Employment Contract
   This contract, dated on the ____ day of ______________ in the year 20____, is made 
  between [company name] and [employee name] of [city, state]. This contract 
  constitutes an employment agreement between these two parties and is 
  governed by the laws of [state or district].
  
  WHEREAS the employer desires to retain the services of the employee, and the 
  employee desires to render such services, these terms and conditions are set forth.
  
  IN CONSIDERATION of this mutual understanding, the parties agree to the 
  following terms and conditions:
   
  Employment
  The employee agrees that he or she will faithfully and to the best of his/her 
  ability to carry out the duties and responsibilities communicated to him/her by 
  the employer. The employee shall comply with all company policies, rules and 
  

  procedures at all times.

  Position
   As a [job title], it is the duty of the employee to perform all essential job functions 
  and duties. From time to time, the employer may also add other duties within 
  

  the reasonable scope of the employee’s work.

   Compensation
   As compensation for the services provided, the employee shall be paid a wage of 
  ___________ [per hour/per annum] and will be subject to a [quarterly/annual] 
  performance review. All payments shall be subject to mandatory employment 
  deductions (State taxes, Social Security, Medicare).
   
  Benefits
   The employee has the right to participate in any benefits plans offered by the 
  employer. The employer currently offers

  . Access to these 
  benefits will only be possible after the probationary period has passed.
   
  Probationary Period
   It is understood that the first [time frame] of employment constitutes a 
  probationary period. During this time, the employee is not eligible for paid time 
  off or other benefits. During this time, the employer also exercises the right to 
  terminate employment at any time without advance notice.
   
  Paid Time Off
   Following the probationary period, the employee shall be eligible for the 
  following paid time off: • [length of time for vacation] • [length of time for sick/
   personal days] • Bereavement leave may be granted if necessary.
   
  

  The employer reserves the right to modify any paid time off policies.
   
  Termination
   It is the intention of both parties to form a long and mutually profitable 
  relationship. However, this relationship may be terminated by either party at 
  

  any time provided [length of time] written notice is delivered to the other party.
  
  The employee agrees to return any employer property upon termination.
   Non-Competition and Confidentiality
   As an employee, you will have access to confidential information that is the 
  property of the employer. You are not permitted to disclose this information 
  

  outside of the company.

  During your time of employment with the employer, you may not engage in any 
  work for another employer that is related to or in competition with the company. 
  You will fully disclose to your employer any other employment relationships 
  

  that you have and you will be permitted to seek other employment provided 

  that (a.) it does not detract from your ability to fulfill your duties, and (b.) you 
  

  are not assisting another organization in competing with the employer.

   It is further acknowledged that upon termination of your employment, you will 
  not solicit business from any of the employer’s clients for a period of at least 
  

  [time frame].

   Entirety
   This contract represents the entire agreement between the two parties and 
  replaces any previous written or oral agreement. This agreement may be 
  modified at any time, provided the written consent of both the employer and 
  

  the employee.

   Legal Authorization
   The employee agrees that he or she is fully authorized to work in [country name] 
  and can provide proof of this with legal documentation. This documentation 
  

  will be obtained by the employer for legal records.

  Severability
  The parties agree that if any portion of this contract is found to be void or 
  unenforceable, it shall be removed from the record and the remaining provisions 
  

  will retain their full force and effect.

  Jurisdiction
   This contract shall be governed, interpreted, and construed in accordance with 
  

  the laws of [State, province].

  In witness and agreement whereof, the employer has executed this contract 
  with due process through the authorization of official company agents and with 
  

  the consent of the employee, given here in writing.

   Employee Signature

   Date

   Company Official Signature

  Source: www.betterteam.com/employee-contract-template

  2.4.2. Sample of a sales contract
   
  PRIVATE CAR SALES CONTRACT
   The Car Details
   Make: Toyota
                                         SOLD FOR:……… frws                                    
  Model………                                     Registration Number…….. Registration document 
  completed by buyer/seller ..Yes/No . Mileage………. Registration document (V5) 
  exchanged ....Yes/No . 
  
  Additional notes and comments agreed on this sale
   
  SELLER’S DETAILS: Name…………….. Address………………
  
  CERTIFICATE of PURCHASE: I am the undersigned buyer of the above car. 
  I have purchased it from the seller named above for the amount of cash also 
  mentioned above (SOLD FOR). This is the final price agreed. I have paid for this 
  car in full and I am in receipt of this car and all the relevant documents to it. The 
  Seller above also acknowledges being in full receipt of all the total amount but I 
  do accept that full title to the car does not fully pass from the seller to purchaser 
  until all cash is paid. Any cheques will need to be cleared before full title passes 
  to myself. It is fully understood that this vehicle is sold as seen. I the buyer agree 
  that I have tried, tested and approved this car as suitable for my personal needs 
  without any representations, warranties or conditions expressed or implied 
  whatsoever. 
  Buyer’s Name:………………………                                                                  
  
  Buyer’s Address: …………                                                                                                                                                               
  
  Buyer’s Signature in agreement:  …………                                                   
  
  Seller’s Signature in agreement: …………                                                    
  

  Date:  …………                                

  Application Activity 2.4
   Assume, your parents have houses to rent at home, help them design a 
  

  rental contract that will be signed by the tenants. 

  2.5 Termination/discharge of business contracts
   Activity 2.5
   What do you think would lead you to terminate a contract with your 
  suppliers?
  To terminate a contract means to end the contract. Contract may be terminated 
  under the following circumstances:
  
  By performance: If the contract is performed and fulfilled as expected under 
  the terms and conditions of the contract and both parties are satisfied, then the 
  contract may be terminated.
  By agreement: The parties to the contract may freely agree to end the contract 
  if both consent to end the contract.
  By destruction of the subject matter: The contract may be put to an end 
  when the subject matter of the contract ceases to exist such as being destroyed, 
  stolen or died.
  By operation of the law: The contract may be terminated by law if it is illegal, 
  if one party becomes bankrupt, insane or dies.
  By frustration: A contract can be put to an end when a condition set in hinders 
  one of the parties from performing his/her contractual obligations.
  For convenience: Where the contract allows a party to terminate the contract 
  at any time by providing notice to the other party for example employment 
  contract.
  Due to a breach: Where one party has not complied with an essential contract 
  condition, the other party may decide to terminate the contract and seek 
  compensation for damages.
  By lapse of time: If the offeror fails to perform and the offeree fails to take 
  action within this specified period, then the latter cannot seek remedy through 
  law. It discharges the contract due to the lapse of time. For example, Ngabo 
  takes a loan from Kamikazi and agrees to pay instalments every month for the 
  next three years. However, he does not pay even a single instalment. Kamikazi 
  calls him a few times but then gets busy and takes no action. Four years later, 
  she approaches the court to help her recover her money. However, the court 
  rejects her suit ,since she has crossed the time-limit of three years to recover 
  

  her debts.

  Application Activity 2.5
  1) Read the following paragraph and answer the questions that follow:
   
  Musoni started a business selling general merchandise in his 
  community. He is renting the place where his business operates. He 
  buys his goods from a nearby town through a fellow businessperson. 
  He says he trusts his friend, so they never write down anything when 
  sending for goods but just gives him the money. He always sells 
  goods to his customers on credit but rarely make any record of such 
  transactions. Recently, after some advice from a friend, he contracted 
  a construction company to build for him a two-roomed building from 
  where he will shift his shop.
   
  a) Mention some of the mistakes Musoni is doing in his business 
       activities?
  b) What are the likely consequences of Musoni’s actions mentioned 
       above?
  c) What advice would you give to Musoni to avoid the consequences 
       above and why?
  d) What may cause Musoni to terminate the contract with the 
       construction company?
  2)Kizito offered 10,000Frw for the return of his lost dog, but then he 
  refused to pay because he thought the person who brought the dog 
  back had stolen it.
  
  Was there a valid contract in the scenario above?
  
  Do you think Kizito is right? Give reasons to support your answer.
  
  What advice would you give to the person who brought the dog  back? 
  
  Skills lab 2
   With reference to the knowledge of Business contracts, design contract                             
  templates  to be used in the school business club when dealing with; a) 
  

  suppliers. b) Customers,  c.) Employees of the club,  d.) Club members.

   End of unit 2 Assessment
   1) Read the case study below and answer the questions that follow:
   
  Shine Business club
   Shine business club wanted 3crates of soda which they wanted to sell 
  to their school that was organizing a visiting day. Chantal an active 
  member of the club having been close to Bizimungu an entrepreneur 
  dealing in retail business convinced the club to deal with him. The 
  club paid him and agreed he would deliver the sodas to the club after 
  three days but unfortunately after the agreed time, he didn’t deliver 
  the sodas as expected. When the club contacted him for the sodas, he 
  denied to have entered into any dealing with them that if he did, he 
  would be having at least a formal document to prove that. The club 
  reported the matter to the school administration, but it couldn’t help 
  them since it was not notified of that dealing.
  a) What are some of the essential elements of a valid contract 
  observed in the above case study?
  b) Was there a valid contract in the above case study? Support your 
        answer
  c) What advice do you give to shine business club?
  d) How would you approach the situation or the above problem if it 
       was your business club?
  
  2) Analyze the example below and answer the questions that follow:
   
  Nkusi and Mukarutesi are capable adults. Nkusi is in the need for a 
  new car. it is on a budget, so he scans the classified advertisements 
  and finds Mukarutesi, who is selling an old Toyota Carina for 
  2,000,000Frw. Nkusi calls Mukarutesi and offers 1,800,000Frw. 
  Mukarutesi accepts Nkusi’s offer and they decide to meet. At the 
  meeting, Nkusi hands over 1,800,000Frw and Mukarutesi hands 
  

  over the keys for the Toyota Carina.

   a) Is there a valid contract in the above example?
   b) Referring to the elements of a valid contract, support your 
      response;
   c) Which form of business contract would you advise Nkusi to sign 
  with Mukarutesi?
   d) What do you think may lead the contract in the example above to 
  

  be terminated?

  3) Read the following passage and answer the questions that follow.
   Ntwali started a business selling general merchandise in his community. 
  He is renting the place where his business operates. Ntwali paid his 
  property owner three months’ rent in advance but never asked for 
  receipt. After two months, his property owner says he wants the rent for 
  the two months. Ntwali is frustrated and tries to remind the property 
  owner that he paid his rent for three months. The property owner denies 
  and asks Ntwali for proof of the payment which he does not have. Ntwali 
  is stuck, does not know what to do while the property owner threatens 
  

  to evict him if he does not pay his rent.

   a) What is the cause of the conflict in the example above?
   b) Advise Ntwali on how he can resolve the conflict with the property 
        owner
   c) What are the disadvantages of the form of contract between Ntwali 
  and the property owner?
   d) Help Ntwali design a written contract that he can sign with his 
  

  property owner to avoid such conflicts again.

• UNIT 3: TAXES IN BUSINESS

  

  Key unit competence: To be able to analyze the role of tax towards economic 
  

  development of the country and pay taxes.

  Introductory activity: A case study

  Why Do You Have to Pay Taxes 
  Every year around, before and after June 15, everybody especially business 
  people will be discussing about tax changes in the national budget. This is 
  because tax reforms and new taxes introduced are announced on that day. 
  However, have you ever wondered why you and businesses need to pay taxes?
  
   In Rwanda, there are arms of the government (ruling bodies) from the 
  village, sector, district, provincial and national levels. These bodies comprise: 
  Legislature (who make laws), Executives (who enforce laws) and Judiciary 
  (who exercise laws). The salaries that public servants receive to do their jobs 
  come from taxes. Paying taxes is considered a civic duty, although doing so is 
  

  also a requirement of the law.

  Taxes take many forms too. When you work at a job to make money, you pay 
  income taxes. Depending on how much money you earn, a certain percentage 
  (part) of the money you make is withheld (kept out of your paycheck and 
  

  sent to the government).

   When you buy things at a store, you also usually pay sales tax, which is a 
  percentage of the cost of the item charged by the store. If you own property, 
  

  you also pay property taxes on the value of your property.

  Paying your taxes is considered a civic duty, although doing so is also a 
  requirement of the law. If you do not pay your taxes, the government agency 
  that oversees taxes — the Rwanda Revenue Authority or RRA - will require 
  

  you to pay your taxes or else face penalties, such as fines or going to jail.

  The money you pay in taxes goes to many places. In addition to paying the 
  salaries of government workers, your tax also help to support common 
  

  resources, such as police and firefighters.

  Tax money helps to ensure the roads you travel on are safe and well
  maintained. Taxes fund public libraries and parks. Taxes are also used to fund 
  many types of government programs that help the poor and less fortunate, 
  

  as well as many schools!

  Each year as the “tax day” rolls in, adults of all ages and businesses must 
  report their income to the RRA, using special tax forms. There are  many laws 
  that set forth complicated rules about how much tax is owed and what kinds 
  of special expenses can be used (“written off”) to lower the amount of taxes 
  

  you need to pay.

   For the average worker, tax money has been withheld from paychecks 
  throughout the year. On “tax day,” each worker reports his or her income and 
  

  expenses to the RRA.

  Employers also report to the RRA how much they paid each worker. The RRA 
  compares all these numbers to make sure that each person pays the correct 
  

  amount of taxes.

   If you have not had enough tax money withheld from your checks throughout 
  the year to cover the amount of tax you owe, you will have to send more 
  money (“pay in”) to the government. If, however, too much tax money was 
  withheld from your paychecks, you will receive a check (get a “refund”) from 
  

  the government.

  From the passage answer the following questions:
  What are the major changes expected by people especially business people 
  on June 15, every year?
  
  What makes the business people so anxious to know the changes mentioned 
  

  above in a)?

   Why do you think it is important for businesses to pay taxes to the government?
   How do the following benefit from taxes?
   i) Entrepreneur.
   ii) Government.
   iii) Society. 
  a) Identify and briefly explain at least two types of taxes paid in Rwanda?
  b) What happens to businesses or people who do not pay taxes?
  

  c) What is the difference between tax and taxation?

  3.1. Tax and business tax

  
  

  Activity 3.1
   1. Explain the meaning of the following terms used in taxation:
   a) Tax                                              b) Business tax
   2. In your community, you have probably heard people and business 
  people complaining about the taxes they pay or charged to different 
  or similar items. Identify any 5 things you have heard normally 
  people complain about.
   3. If you were the one determining or imposing taxes to people and 
  

  businesses, mention any five things you would put into consideration.

  3.1.1. Meaning of taxation concepts
   Tax is a fee without direct exchange requested to the members of the community 
  by the State according to the law, to financially support the execution of the 
  government tasks.
  
  Business tax refers to compulsory and non-refundable payments made by 
  the business to the government or local authority to raise revenue to finance  
  public expenditures. 
  
  Taxation is a system of raising money or revenue by the government from 
  individuals/businesses and companies by law through taxes.
  
  Taxation is a system/practice of government collecting money from its citizens 
  to pay for public services.
  
  Tax avoidance is a situation where a business person does not pay tax because 
  s/he has avoided the product or activity on which the tax is imposed. It is the 
  taxpayer’s exploitation of loopholes in the tax system there by paying less tax 
  than what they are supposed to pay. 
  
  Example of Tax Avoidance:
   • Taking legitimate tax deductions to maximize business expenses and 
  thus lower your business tax bill.
  Tax evasion is the illegal practice of not paying taxes by either not reporting 
  income, reporting expenses not legally allowed, or by not paying taxes owed. In 
  businesses, tax evasion can occur in connection with income taxes, employment 
  taxes, sales, etc.
   
  Examples of practices considered as tax evasion:
   • It is considered tax evasion if you knowingly fail to report income.
   • Under-reporting income (claiming less income than you actually received 
  from a specific source).
   • Providing false information to the RRA about business income or expenses, etc.
  
  3.1.2 Characteristics or principles of a good taxation system
  
   A good taxation system can contribute a lot to the economic development of a 
  country and its national treasury. Equitable taxation system bears a significant 
  role in bringing harmony in the lifestyle of the population of the country. A good 
  tax system should consist of taxes which conform to the canons of taxation. The 
  

  canons or principles of taxation are explained as follows:

  
  1) Convenience: Places, periods and seasons in which the tax dues are 
  collected should be convenient to the taxpayer.  For example, the convenient 
  time to a trader is when s/he has made a profit. For a farmer, is when s/she 
  has sold his/her products.
  2) Simplicity: The type of tax and the method of assessment and collection 
  must be understandable by both the taxpayer and tax collectors. 
  Complicated taxes may lead to disputes, delays and high costs of collection 
  in terms of time and resources.
   3) Certainty: The taxpayer must know the nature, base and amount of tax 
  without doubt. Unpredictable taxes discourage investment and reduce 
  work effort. Simply the tax should not be arbitrary.
   4) Economy: The cost of collection and administration of tax must be much 
  lower than the tax collected
  5) Elasticity: A tax should change directly with a change in the tax base. If the 
  tax base increases, the tax charged on the tax base should also increase.
  6) Productivity: The fiscal authorities should be able to predict and forecast 
  accurately the revenue a particular tax would generate and at what rate it 
  would flow in.
  7) Equity: Tax assessment should be in such a way that taxpayers bear a 
  proportionately equal burden. I.e. people who earn more income should 
  be taxed more than those who earn less income.
   8) Diversity: This canon requires that there should be a number of taxes of 
  different varieties so that every class of citizen may be called upon to pay 
  

  something towards the national priorities

  
   Application Activity 3.1
   1. Why is it important to have principles of taxation?
   2. Referring to the principles (characteristics) of a good taxation system 
  you know, briefly explain why each is important to the taxpayer and 
  tax authority (RRA).
   3. With examples, differentiate
   a) Tax and Taxation
   b) Tax avoidance and Tax evasion
   4. Do you think tax evasion is good? Give reasons to support your  response
  
  3.2. Importance of paying taxes
  
  Sources: http://www.kigalicity.gov.rw 
  Figure 3.2 Taxes help the government to build infrastructures
  
  Activity 3.2
   1. With examples from your community or Rwandan community at 
  large, why do you think people and business enterprises need to pay 
  taxes to the government?
   2. As an entrepreneur to be or referring to the activities of entrepreneurs 
  in your community, how do you think businesses or entrepreneurs 
  benefit from paying taxes?
   3. In general, how does your society benefit from paying taxes? Give 
  examples to support your views.
  

   

  3.2.1. Importance of paying taxes to an entrepreneur

  
  

   • Paying taxes by the entrepreneur helps the business activity to continue, 
      as it does not face penalties and associated costs from the RRA for non
   payment.
   • When an entrepreneur pays taxes, it improves his/her reputation or 
     public image which may result in increased customers and better services 
   from the government.
   • To avoid inconveniences of closure of the business and its associated 
      costs: when entrepreneur fails to pay assessed taxes, his/her business is 
  subject to penalty even closure to some cases.
  • Business needs certain infrastructures to operate successfully such as 
     roads to move raw materials, finished goods, workers; security for their 
     enterprises, among others, and all these are provided by the government 
  

   from taxes. 
  

  • Paying taxes means contributing money to government agencies or 
   departments such as Development Bank of Rwanda (BRD), Business 
  Development Fund (BDF), which support entrepreneurs to operate 
  

  business activities through soft loans and other financial support. 

  
  3.2.2. Importance of paying taxes to the government
   • Source of government revenue: taxes are the main source of government 
  revenue to finance its public expenditure. So taxes enable the government 
  to pay its workers, construct roads, maintain security, provide health care, 
  education among others.
   • Taxes benefit the Rwandan government to meet its objectives and goals 
  such constructing affordable houses to the citizens which helps improve 
  the standards of living
   • Taxes help the government to finance its policies especially on poverty 
  alleviation through programs such as “GIRINKA”, “VUP”, “UBUDEHE” 
  among others.
   • Taxes enable the government to regulate the prices of goods and services 
  in the country hence ensuring a low cost of living and maintaining the 
  standards of living of the citizens.
   • Taxes enable the government to maintain a balance between the poor 
  and rich. The government uses the taxes from business people to provide 
  services needed by the poor, which otherwise the rich could not provide.
   • Taxes enable the government to promote its policy industrialization 
  through reducing products from other countries that would otherwise 
  outcompete the home industries. 
  • Taxes enable the government to ensure that the citizens have enough 
  products. This can be through taxes charged to reduce products moving 
  out of the country or removing taxes on goods needed in the country. This 
  

  helps maintain a high standard of living.

  
   3.2.3. Importance of paying taxes to Society
   • There are reduced rates of poverty among the community due to a 
  significantly equal distribution of income through various activities and 
  projects set by the government.
   • Improved wellbeing among the vulnerable and elderly as they benefit 
  from the different government programs financed through taxes.
   • Reduced infant mortality rates and increased life expectancy due to 
  improved access to health facilities and services.
   • Increase in the percentage of the population that completes secondary 
  and TVET education, reducing the literacy levels, improving on the 
  peoples’ skills through programs such as 12YBE.
   • Increased community/social solidarity, general happiness, life satisfaction, 
   and a significant more trust among the community members and for 
  public institutions.
   • Taxes are charged on some products to discourage their production 
  and usage hence controlling over-exploitation of resources as well as 
  

  protecting the environment which is vital for the existence of the society.

  
   Application Activity 3.2
   1. By giving specific examples from your community, how does your 
  society benefit from taxes?
   2. What do you think would happen in the country if taxes were not paid?
  
  3.3. Calculation of taxes
  
  
  Activity 3.3
   1. Do you think it is important for an entrepreneur to know how to 
  compute the amount of tax he/she is supposed to pay? Give reasons.
   2. What do you think the term “Pay-As You-Earn (PAYE) tax means”? 
  

  And how is it calculated?

  There is a variety of taxes that a business has to pay such as corporate income 
  tax, trading license tax, professional income tax or PAYE (Pay-As-You-Earn), 
  rental income tax, fixed asset tax, Value Added Tax (VAT), Sumptuary tax, etc. 
  but here, an emphasis is made on:
   
  1. Pay- As- You Earn (PAYE) and
   2. Value Added Tax (VAT
   
  3.3.1. Pay-As -You-Earn (PAYE) tax or professional income tax
   The tax law requires that when an employer makes available employment 
  income to an employee the employer must withhold, declare, and pay the PAYE 
  tax to the Rwanda Revenue Authority within 15 days following the end of the 
  month for which the tax was due.
  
  PAYE: is composed of Wages, salaries, leave pay, sick pay, medical allowances, 
  pension payment etc. Pay-As-You-Earn tax is computed as follows:
  

  
  

  Example:
  

  The following relate to monthly salaries of Kanyarwanda enterprise employees 
  

  for year 2018.

  a) Rukundo earns 450,000Frw
   b) Karinganire earns 89,000Frw
   c) Keza earns 28500Fw
  

   d) Buzima earns   12,5000Frw 

  Required:
   Calculate the total PAYE for above employees that Kanyarwanda enterprise 
  

  pays to RRA every month.

  Solution:

   a) Rukundo : 

  

   Total TAX for Rukundo = 14000+105000= 119,000Frw

   b) Karinganire:

  

  Total tax for Karinganire is 11,800Frw
   c) Since Keza earns less than 30000Frw she does not pay PAYE. Her total tax =0 
  

  (28500*0)

  d) Buzima:

  

  Total tax for Buzima =14000+7500=21,500Frw
  
  Total PAYE  for Kanyarwanda  enterprise every month 
                =   (119,000+11,800+21,500)Frw= 152,300Frw
   Note:
   Exemption for PAYE is that every person who earns income less than 30000 
  does not pay PAYE to RRA.
  
  The “casual laborer” means an employee or worker who performs unskilled 
  labour activities, who does not use machinery or equipment requiring special 
  skills, and engaged by an employer for an aggregate period not exceeding thirty 
  

  (30) days during the tax period.

  3.3.2. Value Added Tax (VAT)
  

  
  

  Value Added Tax was introduced in Rwanda in 2001. VAT is a tax on the added 
  value achieved by a firm. This is the difference between the buying price (of 
  

  raw materials) and the selling price of the product in whatever forms it is sold. 

  Value added = F.P – I.C where F.P is final product, IC is intermediate costs

  Tax rate 
  The VAT rate is applied to duty-free goods. Several rates can be applied 
  

  depending on the nature of products. The standard rate is usually 18%

   Example 1:
   UTEXRWA industry bought cotton from a local farmer worth 1200, 000Frw to 
  use in production of blankets;170 blankets were manufactured and sold to a 
  wholesaler at a cost of 4,000,000Frw who later supplied it to LEMIGO hotel 
  at a value of 8,000,000Frw VAT included. Calculate the value of VAT paid on 
  

  blankets.

  Possible solution 
  Step 1 VAT paid by local farmer:
   VAT =1,200,000Frw*18% = 216,000Frw
   Step 2 VAT paid by wholesaler:
   VAT = FP -IC where FP is final product and IC is intermediate cost
   Value added =4,000,000Frw-1,200,000=2,800,000Frw
   VAT paid by wholesaler =2,800, 000Frw*18%= 504,000Frw
   Step 3 VAT paid by LEMIGO hotel:
   VAT paid by LEMIGO hotel= 8,000,000-4,000,000Frw= 
  (4,000,000Frw*18%)=720,000Frw
   
  Therefore, total VAT =216,000+504,000+720,000 =1440, 000Frw
   Alternative:
   VAT is calculated on sales.
   VAT =sales *18%
   Which is equal 8,000,000Frw*18%=1,440,000Frw
   
  Example 2:
   A students’ business club has sold goods to XY enterprise at 100,000 Frw VAT 
  excluded.
  
  Calculate:
  a) VAT received 
  

  b) The price VAT included

  Solution:

  
  

  
  

  OR
  

  The price VAT excluded= Price VAT included-VAT paid
  

                  = 1,000,000Frw- 152,542.37Frw = 847,457.63Frw

  Exemptions on Value Added Tax
   The following goods and services shall be exempted from value added tax:
   1. Services of supplying clean water and ensuring environment treatment 
  for nonprofit making purposes with the exception of sewage pump- out 
  services; 
  2. Goods and services for health-related purposes: (health and medical 
  services, equipment designed for persons with disabilities, goods and drugs 
  appearing on the list made by the Minister in charge of health and approved 
  by the Minister in charge of taxes. 
  3. Educational materials, services and equipment; books, newspapers and 
  journals
   4. Transportation services by licensed persons: 
  5. Lending, lease and sale: (sale or lease of land, sale of a whole or part of a 
  building for residential use, renting or grant of the right to occupy a house 
  used as a place of residence of one person and his/her family) etc.
   6. Financial and insurance services: 
  

  7. Precious metals: sale of gold in bullion form to the National Bank of Rwanda; 
  

  8. Any goods or services in connection with burial or cremation of a body 
  provided by an Order of the Minister in charge of finance; 
  9. Energy supply equipment appearing on the list made by the Minister in 
  charge of energy and approved by the Minister in charge of taxes; 
  

  10. Trade union subscriptions; 
  

  11. Leasing of exempted goods;
  

  12. All agricultural and livestock products, except processed ones. However, 
  

  milk processed, excluding powder milk and milk derived products, is 
  exempted from this tax; 
  

  13.Agricultural inputs and other agricultural and livestock materials and 
  

  equipment appearing on the list made by the Minister in charge of agriculture 
  and livestock and approved by the Minister in charge of taxes.
  

  14. Gaming activities taxable under the Law establishing tax on gaming 
  

         activities;
  

   15. Personal effects of Rwandan diplomats returning from foreign postings, 
  Rwandan refugees and returnees entitled to tax relief under customs laws. 
  

  16. Goods and services meant for Special Economic Zones imported by a zone 
  user holding this legal status; 
  17. Mobile telephones and SIM cards; 
  18. Information, communication and technology equipment appearing on the 
  list made by the Minister in charge of information and communication 
  

  technology and approved by the Minister in charge of taxes.

  Application Activity 3.3
  

   1. A students’ business club (SBC) in one of the TTCs has the following 
  regular employees. Their salaries are in accordance with their 
  

  appointment as follows:

  
  

   Calculate the PAYE tax on each  individual employee
   2. The PAYE tax to be withheld and paid by the business club to RRA2. 
  Using the information available on the below EBM issued receipt, 
  compute the following:
   a) Price VAT excluded
  

   b) VAT to prove the amount appearing  on the receipt.

  

  3.4. Penalties of not paying tax
   Activity 3.4
   1. Identify instances through which a taxpayer may undergo various 
  penalties.
   2. What do you think may happen to an entrepreneur if he/she does not 
  comply with the tax obligations?
   
  The penalties of not paying tax include:
   • Fines and interest: A taxpayer who fails to comply with the provisions 
  of law determining and establishing a tax shall be liable to a fine. The 
  fines will vary according to types of taxes. 
   Example of Penalties and Interest on not paying PAYE
   A taxpayer who fails to pay tax within the due date is required to pay interest 
  on the amount of tax. Interest is calculated on a monthly basis at the inter-bank 
  offered rate of the National Bank of Rwanda plus 2 (two) percentage points. For 
  example, if the inter-bank rate is 9%, interest is imposed at 11% annually.
   • Imprisonment: A tax fraud’s punishment in Rwanda, is the jail for a 
  period between six (6) months and two (2) years; even the Minister’s 
  order determines an award given to any person who denounces a 
  taxpayer who engages in that act. Failure to pay tax withheld: this 
  undertakes 100% penalty and 3months to 2years in jail.
   • Closure of the business for 30 days;
   • Cancellation or withdrawal of registration certificate;
   • Banned from public tenders;
  

   • Exposure in the media

  
   Application Activity 3.4
   1. Discuss why RRA charges fines and penalties?
   2. What do you think will happen if taxpayers don’t pay both taxes 
  

  assessed and fines/penalties?

  
   Skills lab 3
   1. Justify the following statements with concrete examples:
  • “Taxes are more of a benefit than a cost to an entrepreneur” 
  

  • “ Tax evasion is a shortcut to business growth”

   2. A business club at one of the TTCs has 3 regular employees namely 
  KALISA, KALIZA and BERWA with monthly salaries of 35,000Frw, 
  40,000Frw and 20,000Frw respectively. On top of that the business 
  made sales of 300,000Frw VAT exclusive, and the input VAT is 
  34,000Frw. 
  a) Calculate the total amount of tax that the business club has to pay 
  to RRA
  

   b) Advise the above business on how the above taxes would be paid.

  
   End of unit 3 Assessment
   1. It is said that “tax is the free money to central or local authorities from 
  taxpayers” do you agree with this statement. Justify your answer 
  2. Describe any four characteristics of a good taxation system.
   3. How are taxes used by government to:
   a) Support Entrepreneurs
   b) Support the community
   4. Fill in the missing gaps, with the most appropriate term:
   a) ………….  punishment is the jail for a period between six (6) months 
  and two (2) years; even the Minister’s order determines an award 
  given to any person who denounces a taxpayer who engages in that 
  act.
   b) …………. is the compulsory and non-refundable payment made by 
  the business to the Government or Local Authority so as to raise 
  their revenues.
   c) …………. is the one that is exempted from VAT.
   d) …………. is one of the taxes vested to the local government (Districts).
   e) The degree to which the taxpayers meet their tax obligations 
  as set out in the appropriate legal and regulatory provisions 
  is……………………….
   f) The………………. means an employee or worker who performs 
  unskilled labour activities, who does not use machinery or 
  equipment requiring special skills, and engaged by an employer for 
  an aggregate period not exceeding thirty (30) days during the tax 
  

  period.

• UNIT 4: TECHNOLOGY IN BUSINESSES

  

  Key Unit Competence: To be aware of how new technologies can affect 
  

  business activities. 

  Introductory activity

  Analyze the Photos below and answer the questions that follow.
  

  
  

  
  

  a) Looking at picture 1,2,3and 4, explain the advantages and disadvantages 
  of using the above techniques in the production of goods and services.
  
  b) Which production technique is suitable for your school business club?  
  

  Give reasons to justify your answer?

  4.1. Types of technology in business
  

  Activity 4.1
   1.a) Suppose you wish to start up a feasible business in your community. 
  Which type of technology will you use in your business and why?
   b) How would you define the term technology as used in business?
   2. Distinguish intermediate technology from capital intensive and labor
  

  intensive technologies.

   4.1.1. Meaning of technology 
  Technology refers to methods, systems, and devices which are the result of 
  scientific knowledge being used for practical purposes.  
  
  Technology can also be defined as a human knowledge which involves the use 
  of tools, materials, and systems to perform an activity.
  
  Many businesses are using technology to stay competitive, they create new 
  products and services using technology, and they also use technology to deliver 
  

  those products and services to their customers on time and within budget.

  Technology in business allows organizations to improve both the performance 
  and overall effectiveness of products, systems and services, which, in turn, 
  enables businesses to expand quickly and efficiently. Another role of technology 
  

  in business is to provide security to a business.

   Examples of some tools, systems or devices used by technology in business.
   • Desktop Computers and Laptops.
   • Software and Productivity Tools. 
  • Networking of Computers and Printers. 
  

  • Telephone and Voice Mail Systems.

   In Rwanda there are different technologies used to improve the services such as
   • Tap and Go: This is One of the biggest technologies that has changed 
  the face of public transport. It’s a smart transport system that enables 
  passengers to board public buses without using hard cash but rather 
  smart cards. 
  • Zipline’s drone technology: this is a global race for commercial drone 
  deliveries of small packages.  In Rwanda it is used to transport blood to 
  remote areas where accesses to roads are impassable.
  • Irembo services: The burden of walking long distances to seek some 
  government services has consistently been removed. There are large 
  numbers of people who do not have to necessarily travel to apply for 
  a marriage certificate, land transfer, drivers’ related services, birth 
  certificate, criminal record clearance certificate, and other services. 
  These few examples show how technology in business comes to enable 
  businesses to expand quickly and efficiently.
  
   It is important to note that both technologies (Tap and Go & Irembo) aligned 
  with our country’s policy of promoting our economic growth through CASHLESS 
  

  transactions.

   4.1.2. Types of technology
   1. Intermediate technology is one that fits into the level of development of 
  the host country. It is neither too simple nor advanced. For instance, the 
  

  use of ox-ploughs, solar cookers etc.

   2. Capital-intensive technology is the production method/ technique where 
  more machines are used than labor. It is also called labor saving technology 
  because we save more labor to use machines. It is common in industries, 
  

  factories, mining etc.

  

  Advantages of Capital -Intensive Technology 
  • Commodities of high quality are produced, which compete favorably 
  both in the domestic and international market. 
  • There is mass production. With the use of machines more output is 
  produced which stimulates the rate of economic growth in a country.
   • Exploitation of idle resources is encouraged since it is efficient which 
  increases the production of more goods and services.
   • Promotes the development of skills. Using machines requires highly 
  skilled labor therefore encourages people to do research innovations 
  and inventions.
   • Reduces labor unrest for instance demonstrations and strikes. This 
  increases production of more goods and services therefore it is easy to 
  control machines than labor.
   • It saves time and increases labor productivity because a worker who 
  uses a machine will do his or her work in the shortest period and are less 
  exhausted than using manual labor to perform a given task.
   • Promotes specialization this leads to production of excess (surplus) at 
  a low cost. The surplus is exported yielding foreign exchange earnings.
   • High profits for the entrepreneur since it minimizes costs in the form 
  of wages bills and other fringe benefits.
   • It promotes industrialization. When capital intensive technology 
  is adopted, many industries will come up and development of other 
  infrastructures such as roads, hence promoting the tertiary sector.
   • It strengthens good relationships between countries where machines 
  are exported or imported, hence fostering trade.
  
   Disadvantages of capital-intensive technology.
   • It is very expensive to buy machines. Most developing countries 
  depend on foreign aid and loans to finance their budgets, so if they adopt 
  the use of machines, they will have too much debts.
  
  • It leads to technological unemployment since more machines are 
  used than labor in the production process therefore most labor will be 
  unemployed, which is an economic problem.
  
  • It widens the income inequality gap where a few skilled labor will be 
  engaged in the production process to run machines and the unskilled 
  will remain unemployed hence widening the gap.
   
  • High costs as a result of maintenance, repairs when broken down and 
  depreciation. therefore, it is expensive because it requires a lot of foreign 
  exchange to import spare parts and other machines. 
  
  • It encourages rural- urban migration since most machines are used  
  in urban centres this leads to development of shanty towns or slums in 
  cities.
  
   • It is not helpful in the eradication of poverty since there are very few 
  people employed in the production of goods and services.
  
   • It is inappropriate technique in some activities that require human 
  judgement, such as picking flowers and tea, sorting printed papers. In 
  this instance machines may not be applicable at all stages of production. 
  etc.
   3. Labor Intensive Technology is the production method /technique 
  where more labor is used than machines. It is also called capital saving 
  technology meaning we save capital and use more labor. It’s commonly 
  

  used in hotels, restaurants etc.

  

  Advantages of labor-intensive Technology
   • It generates more employment opportunities for nationals due to 
  investments in various sectors. This leads to an even distribution of 
  income in the country since they are many people involved.
   • It reduces costs of production since in most countries labour is cheap 
  and abundant.
   • It helps to reduce rural-urban migration (RUM) since it can easily 
  be established in the rural areas where labor is abundant. This leads to 
  rural transformation hence reduction in RUM, poverty is also reduced and 
  crime rate levels.
   • It increases effective demand, many people are employed which 
  increases their chances of investing in an economy.
   • Monopoly control, it minimizes monopoly tendencies in the industry 
  since the economic power cannot easily be concentrated in a few hands.
   • Labor is more mobile than capital technology. It’s easy to move 
  workers from one town to another compared to moving machinery or 
  capital assets.
   • It does not require a lot of skills and is suitable to work in industries 
  that require human judgement. For instance, picking flowers, picking tea 
  leaves.
   • Labor can provide feedback and craftsmanship in the production 
  process, this provides ideas for continuous improvement hence workers 
  can also adapt to introduce innovative ideas in hand crafts. 
  • It encourages decentralization as it allows industries to be established 
  in various parts of the country. That is to say, the rural areas and small 
  towns. 
  • It minimizes the dependency on technology which might be complex 
  and very expensive, hence increasing self-reliance.
   • It is flexible. Unlike machinery, it can be used to meet the changing levels 
  of consumer’s demands.
   • It helps to increase the standard of living. When labor intensive 
  techniques are adopted, many people in families will get jobs and earn 
  income hence increasing their standards of living.
   • It encourages infant industries, which act as training grounds for man 
  power and this helps in the acquisition of skills. These also play a vital 
  role in the economic development of a country.
   • Personal touch, people can interact properly with customers and most 
  

  services cannot be done with the use of machines for instance hairdressing.

   Disadvantages of labor-intensive technology
   • It is relatively expensive in the long-term when compared to 
  machinery, because it is associated with other labor benefits. For 
  example, housing, insurance, medical bills, trainings,... which increases 
  cost of production.
   • Inferior quality products are produced, when labor intensive 
  techniques are adopted, many people produce products without carrying 
  research thus poor-quality products.
   • Limited hours of work. Machines can work day and night hence produce 
  high quantity output. Economic Growth remains low in a country with the 
  use labor intensive techniques of production.
   • It requires a lot of supervision which leads to under utilization of 
  resources and increased costs.
   • Lack of uniformity in production, with the use of labor- intensive 
  techniques of production there are most likely to produce products that 
  are not uniform which makes them not competitive to the market.
   • Specialization is not promoted in the production process which may 
  slow down the production process.
   • Managerial complexity arises. It is not easy to manage people since 
  they have individual differences especially when a business grows this 
  may further lead to bureaucracy in decision making.
   • It is difficult to get skilled manpower it is easy to get machines than 
  skilled labor in a given field and this hampers the production of goods and 
  

  services. Etc.

   Application Activity 4.1
   1. Justify why the government of Rwanda is encouraging businesses to 
  use capital intensive technology.
   2. Refer to your school and describe how technology has helped in the 
  

  efficiency of the school for both students and the school itself.

  4.2. Characteristics/ features of appropriate technology
   Activity 4.2
   Referring to the types of technology you mentioned above, which type 
  of technology, is appropriate in;
   a) Northern province
   b) Eastern province
   c) Southern province
  

   d) Western province

   Developing countries face challenges of how to utilize resources fully. The 
  dilemma is that labor is so abundant and capital is scarce, therefore they have 
  to choose which technology is appropriate. The following are some of the 
  characteristics of appropriate technology.
   
  1. It should be simple to use without requiring special skills.
   2. It should also be effective in order to increase productivity in the country for 
  economic growth to be attained. 
  3. It should also be readily available not complex to get.
   4. It should be durable and meets the needs of the community.
   5. It should also be cost effective and not very expensive.  
  6. It should be able to reduce income imbalances through employment potential. 
  7. It should produce for an identified market to prevent resources being wasted.
   8. It should be able to produce efficiently the right quality and quantities of the 
  products needed by the consumers. 
  9. It should also minimize the use of imported inputs like labor, raw-materials 
  and some capital equipment. 
  

  10. It should be flexible/ easy to use and require locally available resources.

   Application Activity 4.2
   1. Try to find an example of simple and more complicated technique of 
  

  production from each of the following areas of human activity.

  

  2. If you were to start a business in any of the above human activity 
  areas, which technology will you likely choose? A simple technology 
  or a more complex technology?
  3. What could be the reasons guiding your choice?
  4. Now that you have identified possible businesses from these areas 
  of activities, which technology do you think will be more effective 
  in order to improve the productivity of the specific businesses or to 
  

  improve your qualities?

  4.3. Importance of technology in business

  Activity 4.3
  

   Debate “The use of technology in business has done more good than 
  harm”
  Technology is an essential tool in the day today business operations; no matter 
  the size of the business, technology has both tangible and intangible benefits. 
  These include the following: 
  
  1. The use of ICT through internet helps entrepreneurs to carry out market 
  research. This helps it to grow and acquire more opportunities across the 
  globe, hence widening the market by use of E-commerce sites like eBay, 
  

  Amazon, Jumia, etc.

  2. Technology helps to increase productivity of the labor through collaborating 
  with each other hence speeding up the work.
  
  3. It helps to keep track of records for instance with the use of the accounting 
  software.
  
  4. Technology can be used for security purposes thus reducing threats of losing 
  financial data and vandalism to unknown persons. For example, by using 
  passwords on computers.
  
  5. Technology improves the efficiency of businesses. The use of mobile phones, 
  printers and  E-commerce, eases the work in business.
  
  6. ICT enables easy access to funds through the use of ATM cards, such as debit 
  cards, credit cards, and electronic money transfers etc.
  
  7. It also enables better decision making as entrepreneurs can get information 
  at the right time.
  
  8. Technology helps businesses grow with the use of artificial intelligence. This 
  gives the business a competitive edge over other businesses. 
  
  9. Advanced technology helps to produce better quality products that may fetch 
  a lot of money for the enterprise thus increasing customer satisfaction.
  
  10. Technology helps to perform complicated tasks with ease and faster. For 
  example, use of computerized accounting software like quick books, sage 
  and pastel helps in doing accounting with ease.
  
  11. ICT helps firms to monitor the buying habits of their customers and be able 
  to stock the right products in the right quantities at the right time. Speed 
  Governors help to keep track drivers from over speeding hence reducing the 
  number of accidents.
  
  12. Computers can perform a lot of work in the shortest time possible which 
  would require a lot of time if done manually. Examples include preparation 
  of control accounts, financial statements and preparing payrolls etc.
  
  13. Technology also helps to cut down costs. For example, the costs incurred 
  while transporting and delivery of goods can all be done using computers 
  

  and the internet.

   APPLICATION ACTIVITY 4.3
   Carry out research and identify the various technologies that are being 
  used in businesses be it in your school or other business enterprises. 
  Suggest their importance in terms of communication, management, 
  

  accounting and transport.

  4.4. Technological tools used in business

  Activity 4.4
  

  Observe the pictures below and explain the importance or uses of each 
  

   machine, equipment or technology as used in business.

  
  

  
  

  From the above pictures, you realize that businesses use various technological 
  tools, depending on the type of business, and department. The table below 
  

  shows the common technology tools used in business departments.

  

   Importance of the technological tools in figure 4.4 above as used in 
  business
   Electronic mail:  It is one of the ways businesses can use to reach its clients.  
  Communication is fast and convenient because you can send messages and 
  they are received between the customers and the business.
   
  Automated Teller Machines: These machines help customers to deposit, 
  withdraw at any time. This reduces the queues people would make to get their 
  money. They are also located in different places which eases access to cash
  
  Cash less public systems: (Tap and go) These help businesses to increase 
  customer satisfaction. They are also secure and convenient which minimizes 
  

  fraud cases.

  Electronic safes: These machines are used to keep money. These are assets to 
  the business because they are secure.
  
  Closed Circuit Television (CCTV): These are televisions that can be installed 
  in your business. They can help you monitor your business operations from 
  anywhere. They increase safety for the owner, employees and customers. If a 
  crime occurs, they can be used to provide evidence to catch the criminal. 
  
  Metal detectors: These are handheld detectors which are used to identify 
  metallic objects that may be considered dangerous. They also help provide 
  security.
  
  Bar codes: They are used to track and store information of goods. This 
  increases the efficiency of the business instead of the storekeeper entering the 
  information manually.
  
  Point of sale terminals: A POS solution provide a faster checkout process than 
  the cash registers. This helps people not to make long lines while paying for the 
  goods bought. Using this tool can increase efficiency and improves the image of 
  the business. 
  
  Application Activity 4.4
   1) Describe how new technologies affect business activities. 
  2) Explain the challenges of using such technologies in local and small
  scale businesses in Rwanda. 
  
  Skills lab 4
   Use available resources like the internet, textbooks, magazines, resource 
  persons among others to research, choose the appropriate technology 
  that would improve the performance (Quality, quantity and efficiency 
  of work) of the projects your business club is running or plan to run at 
  the college on each of the following business aspect:
   a. Business registration
   b. Production of Goods and services
   c. Packaging and branding
   d. Marketing
  e. Selling of the products and / services.
   And explain why you have chosen that particular type of technology 
  and how you will acquire it.
   
  End of unit 4 Assessment
   1) Case study
   Mugiraneza has a peanut butter making business. Last week she 
  announced the purchase of new equipment and modern technology that 
  would make a radical change in the production process. The investment 
  would make some employees lose their jobs. Mugiraneza explained to 
  them but there was no doubt, it was in the best interests of the company 
  in general.
  
  Employees were not consulted because it would slow down the process 
  and Mugiraneza felt that it was the best decision to make.
  
  In the long run, the modern technology and equipment should increase 
  the businesses’ competitiveness and produce quality products and in 
  large quantities. The working practices would obviously be changed, and 
  employees would have to learn new skills of using them. The employees 
  were promised to be trained, although it was not a guarantee to employ 
  all of them if they fail to adapt successfully.
  
  After the announcement, the employees were so furious and considered 
  taking industrial action. Hearing the rumors of a possibility to strike, 
  Mugiraneza admitted that the issue was not handled very well but would 
  not reconsider the decision.
  a) What factors may have made Mugiraneza decide to invest in modern 
  technology?
  b) Do you think the employees were right in taking industrial action? 
  Give reasons for your arguments.
  c) Analyze the factors that Mugiraneza might have taken into account 
  before acquiring the modern technology.
  d) Mugiraneza admitted that the issue was not well handled. In your 
  opinion, how should she have handled it?
  
   2. Peter produces flowers and sells them both in the local and 
  international markets. He plans to use e-commerce in his business.
   (i) Mention any 3 e-shops he can contact for advice.
   (ii) How can Peter find other e-shops to sell his products on the 
  international market?
   iii) Explain the merits and demerits of using e-commerce in a 
  business like that of Peter.
   (iii) Write a letter to Peter advising him on how to use e-commerce 
  for the success of his business.
  
  3. Many people believe that the key to better performance is good 
  management rather than the use of more technology. As an 
  entrepreneurship student teacher, critically assess this view.
   
  4. The Government of Rwanda is intensifying the campaign of starting 
  small and medium enterprises to boost made in Rwanda and to export 
  made in Rwanda products to the rest of the world. Entrepreneurs in 
  order to meet the international market standards and demand, they 
  prefer an investment in automatic and capital intensive technologies, 
  however this affects the numbers of labour force to be employed as 
  very few people with the right skills will be retained and many of the 
  rest with no skills to operate the machines are likely to lose jobs.
  
  Required: With your expert knowledge on technology, advise the 
  entrepreneurs, government and employees on how technology can 
  

  create a win - win situation for all?

• UNIT 5:MONEY MANAGEMENT

  

   Key Unit competence: To be able to manage money responsibly and to keep 
  

  financial records.

  Introductory activity
  Case study:
  Elizabeth and Kabayiza are married with two children, aged three and five. 
  Kabayiza works full-time in manufacturing and Elizabeth works four days a 
  week as a nurse. When they got married, they were renting and maintained 
  two separate accounts as well as a joint account for bills. Now they own a 
  home and are paying off a mortgage and saving determinedly for the future 
  so that they can afford private education for their children by the time they 
  enter high school.
  
  Referring to the story above and your knowledge about entrepreneurship 
  skills learnt and competences developed before, answer the questions below.
  
  a. Why do Elizabeth and Kabayiza need money?
  b. What are the best ways of the couple to save money? 
  c. Why do they need to save money?
  d. Explain the moral lesson that you learn from the above case study
  
   5.1. Meaning of money, savings and saving goals
   Activity 5.1
   Using the knowledge acquired in O’level, explain the meaning of the 
  following terms as used in entrepreneurship:
   a) Money 
  b) Savings
  

  c) Saving goal

   A. Money 
  Money is anything that is generally accepted as a medium of exchange and 
  repayment of debts. 
  
  Money is one of the most important inventions of modern times. It has 
  undergone a long process of historical evolution. 
  

  
  

  Stages in the evolution of money

  
  

   1st Stage: Barter trade: Human beings passed through a stage when money 
  was not in use and goods and services were exchanged directly for goods 
  and services. Such exchange of goods or services for goods or services is 
  

  called Barter Exchange.

   2nd Stage: Commodity money: The inconveniences and drawbacks of 
  barter trade led to the gradual use of a medium of exchange. In the historical 
  study of money it is found that all sorts of commodities like seashells, pearls, 
  precious stones, tea, tobacco, cow, leather, cloth, salt, wine, etc. have been 
  

  used as a medium of exchange (i.e. money).

   3rd Stage: Metallic money: Inadequacy of commodity money led to the 
  evolution of metallic money (gold and silver). The problem of uniformity of 
  

  weight and purity of precious metals led to private and public coinage.

   4th Stage: Paper money: This process was finally taken over by the state 
  as one of its essential features and ultimately commodity money gave way 
  to paper money which means currency notes. Nowadays, the  use of paper 
  money has almost become universal along with coins made of copper, bronze 
  

  or nickel, etc.

   5th Stage Bank money: The process of evolution of some better medium 
  of exchange still continues. As the volume of transactions increased, even 
  paper money started becoming inconvenient because of the time involved in 
  its counting and space required for its safe keeping. This led to bank money 
  or credit money in the form of cheques, drafts, bills of exchange, credit cards, etc. 
  

  B. Savings 

  
  

  Savings is the portion of income not spent on current expenditures. Because 
  a person does not know what will happen in the future, money should be 
  saved to pay for unexpected events or emergencies. An individual’s car may 
  breakdown, their dishwasher could begin to leak, or a medical emergency 
  could occur. Without savings, unexpected events can become large financial 
  burdens. Therefore, savings helps an individual, family or business become 
  

  financially secure.

   C. Saving goals 
  Money can also be saved to purchase expensive items that are too costly 
  to buy with monthly income. Buying a new house, clothes, purchasing an 
  

  automobile, or paying for a vacation, etc. can all be accomplished by saving a 

  portion of income. We usually save for:
   • Basic needs
   • Household expenses
   • Education
   • Emergencies/safety
   • Retirement/security
   • Family wellbeing
   • Esteem
  

   • Self-actualization

   Application Activity 5.1
  Using the knowledge and skills acquired in year 1, Unit 3: Setting 
  

  entrepreneurial goals, set a SMART saving goal.

  5.2. Need for money
  Activity 5.2
  

  Observe the following figures and answer the questions that follow:

  
  

  a. Describe at least five household expenses.
  

   b. Discuss different sources of income (money). 

  In everyday life, human beings have different needs. Money is used in exchange 
  when selling and purchasing different products and services. Money is not only 
  needed to be used personally but also in business activities.
  
  Money is most especially needed for the following reasons:
   • Investment: Money is used to purchase goods that are not consumed 
  but are used in the future to create wealth. It is used for things that can 
  generate more money in the future.
  • Personal needs: Money is used to make personal expenditure including, 
  but not limited to, the need for food, clothing, shelter, health care and 
  safety.
   • Emergency: Some money is put set aside to specifically cover any 
  unexpected expenses that may come up. An emergency fund may cover 
  unexpected car repairs, medical bills or other emergency situations.
   • Education: Money is used for the purpose of completing the education.
   • Retirement: Retirement is the years that an individual is able to enjoy 
  after spending a majority of his/her life devoted to career. One should 
  put aside a portion of the income to help him or her after working age, etc.
   
  Application Activity 5.2
   1.As a student of entrepreneurship, come up with different ways of 
  getting money.
  

   2. Make the total cost of all household expenses in your family.

   5.3. Obstacles to achieving saving goals
   Activity 5.3
   Assess your home community and describe any five obstacles for people 
  in that community to achieving saving goals.
   Saving is a conscious and deliberate way of setting aside a portion of the 
  personal income for future use. 
  The following are some of the hindrances to achieving saving goals:
   • Procrastination: Delaying savings or putting savings off for another time.
   • Poor spending habits: It includes spending on unnecessary items; 
  
  Impulse buying; hedonistic lifestyle.
   • Culture of dependency: Being over dependent on others.
   • Lack of financial literacy: Spending on liabilities or items that 
  decrease in value over time; not knowing how your money will grow 
  or work for you.
   • Not budgeting: A budget is the bedrock of your personal finances. 
  Without a budget, your money may be standing on shaky ground. 
   Why? A budget helps you see how much money you have coming in 
  

  and going out. And, having a budget in place can help you save money.

   Application Activity 5.3
   Youth are a rapidly growing percentage of the Sub-Saharan African 
  population, and many are economically vulnerable. Financial inclusion 
  for youth, particularly the promotion of savings behavior is associated 
  with a number of positive social and economic outcomes and is an 
  international priority. However, the majority of youth in Sub-Saharan 
  

  Africa are not saving.

   Question:
   According to the extract above, discuss any ten reasons why majority of 
  

  youth of sub-Saharan Africa do not save.

   5.4. Where to save
   Activity 5.4
   In your community, you have probably heard people and business 
  people talking about where they save a portion of their earnings. Identify 
  where to save money according to what you have heard normally people 
  

  talking about.

  

  Banks provide savings account services
   Some savers place their money in a jar, coffee can or a piggy bank which all is 
  not safe and not encouraged. . It is wise to store money in financial institutions 
  like banks depository institution. The following are examples of where to save 
  

  money:

   • Banks: Through opening up different savings account, one can save his/
   her money. For instance, if you find a bank or credit union that offers a free 
  savings account, you can open up several savings accounts.  Then every 
  time you get an income, you can put money into each of these accounts 
  for every specific thing that you are saving for. This way you can keep your 
  money safe from accidentally being spent, and it will be there when you 
  

  need it.

   • Assets: Individuals can save money through investing in fixed assets. 
  A good example can be when someone invests his/her money in rental 
  houses (real estates). The stock market may be down, but your tenants 
  

  will still be paying some rent every month.

   • Securities: Securities are generally classified as either equity securities 
  such as stocks and debt securities such as bonds and debentures. The sale 
  of securities to investors is one of the primary ways that publicly-traded 
  companies drive new capital for operations. People or businesses can 
  

  save their money through buying available securities at the market.

  

  • Small savings groups: This is when someone joins a group comprised of 
  15-25 self-selected individuals who save together and take small loans 
  from those savings. Savings groups provide members the opportunity 
  to save frequently in small amounts, access to credit on flexible terms, etc.
  • Starting a business: Saving can be through starting up a business that 
  

  may generate incomes and profits in future time.

   Application Activity 5.4
   KABASHA won entrepreneurship competition. He received a cheque 
  of 5,000,000Rwf as a reward, but he doesn’t have a ready plan for that 
  money won. 
  
  Required: 
  Advise KABASHA to identify where to save his money to avoid needless 
  

  expenditure.

  5.5. Managing money

  Activity 5.5
  

  
  

  Extract (Money management-How to make your money go further)
   The way you spend your money today will determine what you have 
  in six months from now, a year from now, five years from now, and in 
  your lifetime. You control your financial destiny. You are responsible for 
  the amount of money you earn and for the amount of money you spend. 
  Successful money managers control the way they spend their money. 
  They use money to accomplish the things that are important to them. 
  Good money managers manage their money rather than letting it dribble 
  

  away from them. 

  Required:
   1. Do you have control of the way you spend your money? If yes, how 
  do you do it?
   2. Do you live within your income, or do you have to borrow money or 
  use savings to meet your regular monthly expenses? Yes/No. Explain 
  your answer.
   Money management is the process of budgeting, saving, investing, spending or 
  otherwise overseeing the financial usage of an individual or group.  The ability 
  to manage money has to be learned, developed, and practiced on a daily basis. 
  

  There are eight steps to successful money management: 

  1. Get organized.
   2. Decide what you want to do with your money.
   3. Look at all available resources.
   4. Decide how much money you are worth.
   5. Find out how much money you make.
   6. Find out how much money you spend.
   7. Set up a plan for spending your money and stick to it. 
  8. Evaluate your spending plan
   The following are essentials for good money management:
   • Keeping financial records 
  • A simple cash book 
  • Financial forecast  
  • A simple cash flow plan  
  • Practicing money management habits E. g. re-use, recycle, repair and 
  

  reduce.

   KEEPING FINANCIAL RECORDS
   Good financial recordkeeping enables business organizations to plan properly 
  and also check for misappropriations of resources. Everyone in business must 
  keep records. Keeping good records is very important to your business. A simple 
  cash book, financial forecast and a simple cash flow plan are very important for 
  

  money management.

  

   • A simple cash book
   The simple cash book (also known as single column cash book) is a cash book 
  that is used to record only cash transactions of a business. It is very identical to 
  a traditional cash account in which all cash receipts are recorded on left hand 
  (debit) side and all cash payments are recorded on right hand (credit) side in a 
  chronological order.
  
  The single column cash book has only one money column on both debit and 
  credit sides titled as “amount” which is periodically totaled and balanced like a 
  T-account. As stated earlier, a single column cash book records only cash related 
  transactions. The entries relating to checks issued, checks received, purchases 
  discount, and sales discounts are not recorded in single column cash book.
  

   

  Format of Simple Cash Book:

  
  

  The purpose of four columns used on both sides of a single column cash book 
  is briefly explained below:
   • Date: The date column of the cash book is used to record the year, 
  month and actual date of each cash transaction. This column ensures the 
  chronological record of each business transaction involving receipt or 
  payment of cash.
   • Details: The details column is used to record the account titles to be 
  debited or credited as a result of each cash transaction. This column is 
  sometimes titled as “particulars”.
   • Ledger Folio: This column is used to write the page number of each 
  ledger account named in the description column of the cash book.
   • Amount: The amount column of single column cash book is used to 
  record the money value of each cash transaction.
   • Note: The debit side (receipt side) of a single column cash book is always 
  heavier than the credit side (payment side) because we cannot pay more 
  cash than what we receive during a period.
  
   Example:
  The Student business club at one of TTCs uses a single column cash book to 
  record all cash transactions. It engaged in the following cash transactions 
  during the month of September 2019.
   • Sep.01: Cash in hand at the beginning of the month Rwf 4,654.
   • Sep.02: Paid salaries to employees for the last month Rwf 3,000.
   • Sep.05: Cash received from S & Co. for a previous credit sale Rwf 2,720.
   • Sep.06: Merchandise purchased for cash Rwf 1,400.
   • Sep.07: Merchandise sold for cash Rwf 4,700.
   • Sep.10: Office furniture purchased for cash Rwf 3,080.
   • Sep.12: Stationery purchased for cash Rwf 170.
   • Sep.15: Merchandise sold for cash Rwf 9,000.
   • Sep.17: Cash paid to A & Co. for a previous credit purchase Rwf 1,780.
   • Sep.20: Merchandise purchased for cash Rwf 2,460.
   • Sep.21: Merchandise sold for cash Rwf 4,680.
   • Sep.24: Cash received from S & Co. for a previous credit sale Rwf 2,400.
   • Sep.28: Cash paid for office rent Rwf 1,600.
   • Sep.30: Merchandise sold for cash Rwf 7,200
   Required: Record the above transactions in a single column cash book (simple 
  cash book)                                     Solution:
  
  The Student business club’s simple cash book for the month of September 2019
  
   Financial forecast
   ‘Forecast’ means to form an opinion beforehand i.e. to make a prediction. Thus 
  financial forecasting means a systematic projection of the expected action of 
  finance through financial statements. It is a kind of plan which will be formulated 
  at a future date for a specified period.
   
  The merits of the financial forecasting are noted below:
   (i) It can be used as a control device in order to fix the standard of performances 
  and evaluating the results thereof
   (ii) It helps to explain the requirement of funds for the firm together with the 
  funds of the suppliers.
  (iii) It also helps to explain the proper requirements of cash and their 
  optimum utilization is possible and so surplus/excess cash, if any, 
  invested otherwise.
   
  Elements of Financial Forecasting:
   Financial forecasting involves preparation of proforma financial statements 
  and also the preparation of Cash Budget.
   
  Therefore, it includes the preparation of:
   A. Pro-forma Income Statement: Pro forma income statement is the statement 
  prepared by the business entity to prepare the projections of income 
  and expenses which they expect to have in the future by following certain 
  assumptions such as competition level in the market, size of the market, 
  growth rate
   B. Pro-forma Balance Sheet: This summarizes the projected future status 
  of a company after a planned transaction, based on the current financial 
  statements.  
  C. Cash Budget: A cash budget is an estimation of the cash flows for a business 
  over a specific period of time. This budget is used to assess whether the 
  entity has sufficient cash to operate
   
  A simple cash flow plan
  Cash flows statement is a statement that provides valuable information about 
  a company’s gross payments and receipts and allows insights into its future 
  income needs. Cash flow statement is important because:
   • Cash from operating activities can be compared to the company’s net 
  income to determine the quality of earnings. If cash from operating 
  activities is higher than net income, earnings are said to be of “high 
  quality.”
   • This statement is useful to investors because, under the notion that 
  cash is king, it allows investors to get an overall sense of the company’s 
  cash inflows and outflows and obtain a general understanding of its 
  overall performance.
   • If a company is funding losses from operations or financing investments 
  by raising money (debt or equity) it will quickly become clear on the 
  statement of cash flows
   
  Why is it necessary for an entrepreneur to make a Cash flow statement?
   • It helps to identify the source of cash inflows in the business and also 
  identify how cash was used
   • It helps management in proper cash planning to avoid excess cash or 
  cash deficits in the business
   • It reports the total amount of cash used during a given period in long 
  term investment activities such as purchase of fixed assets
   • It shows the amount of cash received from various financing sources 
  such as long term loans and sale of shares
   • It helps management to avoid liquidity problems by anticipating when 
  cash is expected to flow in and plan payments accordingly
   • It helps investors to understand how a company’s operations are 
  

  running, where its money is coming from and where it is spent. 

  FORMAT OF CASH FLOW STATEMENT
  

   Cash flow statement for the year ended as at……/ …… /……... 

  

  At the end of that given period, the business will have a surplus if cash inflows 
  are more than the cash outflows or deficit if cash inflows are less than the cash 
  

  outflows.

  Example:  Prepare Didi’s cash flow for the month of January, February, March 
  and April 2006, given the following information below:
   Cash balance b/d or b/f in January was 15000,000Rwf
   Monthly rent income was 5000,000Rwf
   Monthly credit sales to be paid in the next month were 4000,000 Rwf
   Sold a business van in February 14,500,000 Rwf
   Monthly commission received was 3000,000Rwf 
  Monthly cash sales 10,000,000 Rwf
   Monthly cash purchases 12,000,000Rwf
   Bought a truck in January 800,000 Rwf
   Monthly salaries and wages 5000,000Rwf
   Bought machinery worth 15,000,000Rwf, payment of 8,000,000 Rwf was 
  made in January and the balance was paid in two equal installments during 
  

  the month of February and March.

  Solution
   DIDI’S CASH FLOW STATEMENT FOR JANUARY, FEBRUARY, MARCH AND APRIL
  
   PRACTICING MONEY MANAGEMENT HABITS
   With the cost of goods and materials rising, using resources efficiently and 
  reducing your business’ waste makes good financial sense. It’s also better for 
  the environment. The cost of sending waste to landfill is increasing, and so 
  are the restrictions on what you can send. You can face penalties if you do not 
  handle waste appropriately or have the right paperwork before it leaves your 
  premises.
  
  You can save money and make your business more efficient by focusing on how 
  you reduce, reuse, recycle or recover and repair in your business, and how you 
  deal with the waste that remains.
   
  1. Reducing waste
   • Cutting the amount of waste your business has to handle is the most cost
  effective and environmentally-friendly method of dealing with waste.
   • There are a number of areas you could focus on:
   -Procure carefully - buy only what you need, control stock and 
  streamline processes across departments. Buy equipment in bulk to 
  reduce packaging and consider the product›s durability and lifespan - 
  replacing equipment less often will reduce the waste you create. 
   -Look for easy wins - seemingly trivial changes can produce significant 
  savings, such as printing and photocopying double-sided, refilling 
  printer cartridges, switching off lights and electrical equipment, and 
  using rechargeable batteries.
   -Review your processes - ensure that equipment and materials are 
  used efficiently and packaging is kept to a minimum.
   -Product design - keep the amount of materials you use in products to 
  a minimum.
   -Packaging design and use - make sure you use as little packaging as 
  possible to achieve an adequate level of protection for your products.
  
   2. Reusing waste
   You may be able to reuse materials and equipment in your own business or 
  another organization.   
  
  For example, consumers can refill a purchased bottle of water with water from 
  home to minimize the number of plastic bottles being discarded.
  
  Reusing your own business waste can reduce your costs as you won’t need to buy 
  raw materials or pay to dispose of the waste. You may also be able to generate 
  income from materials and goods that are valuable to another organization.
  
  3. Recycling waste
   Recycling is the third-best waste management option for your business, after 
  reducing and reusing waste. Even so, recycling is important because it reduces 
  the amount of waste sent to landfill and reduces the need to use new raw 
  materials. Recyclables include glass, newspaper, aluminum, cardboard and a 
  surprising array of other materials. 
  
  4. Repair
   The business can repair broken materials and equipment such as lamps 
  

  instead of buying new ones

  Application Activity 5.5

  1. Write up a single column cash book of UBUMWE Enterprise for 
  

  the month of April 2015, from the following? 

  
  

   Requirement: Prepare cash book at April 30, 2015:
   2. Given the information below on Central Trading Company Ltd for 
  the month of April, May & June
   • On 1st April, 2005 Central Traders Company Ltd had a cash 
  balance of 10,000,000 Frw.
   • It expected monthly cash sales of 5000,000 Frw.
   • Credit sales were 3,500,000 Frw per month and the payments
   • would be made in the       following months.
   • Monthly rent income from some of its properties was expected 
  to be 1,000,000  Frw
   • Monthly cash purchases were 6,000,000 Frw.
   • Monthly salaries and wages bills were projected at 800,000 Frw.
   • A loan from Umwalimu Sacco was 10,000,000 Frw was received in May.
   • Monthly interest payment of 100,000 Frw on the loan. 
  • Monthly raw material for 5000,000 Frw.
   Required: Prepare central trading company’s cash flow statement for 
  the month of April, May, and June
   
  Skills lab 5
   Discuss and suggest strategies or how you will cut costs/expenses 
  using the 4Rs (reducing, recycling, repairing and reusing) in your 
  student business club. Prepare a new projected cash flow statement 
  after applying the suggested strategies.
  
  End of unit 5 Assessment
   1. Read the following dialogue and answer the questions that follows;
   Peter: Does what you know now about money management affect 
  your future?
   Peace: Of course what you know today affects tomorrow. You 
  couldn’t drive a car without a license, and that is why you need to 
  begin learning about how to spend your money wisely today.
   Peter: How does your attitude towards money change as you age?
   Peace: Five-Year-Old: Come On mom, can I have some money to buy 
  that ring?
  Fourteen-year-old: Mom, I want 10,000Frw to buy designer label 
  top and those cool pants. 
  Eighteen-Year-old: Shoot, I know how i can get money for college. 
  I will ask mom. 
  Forty-Year-Old: I need to save for my retirement. No excessive 
  spending.
   
  Questions
   i. With examples explain how your money management affects your 
  future wellbeing.
  

   ii. Where do you think a person can save? 

• UNIT 6: FINANCIAL INSTITUTIONS

  [

  Key unit competence: To be able to choose suitable financial institutions for 
  

  business transactions.

  Introductory activity

  Today, people with full time jobs or part time jobs who use debit cards, 
  credit cards are most likely to have a close relationship with financial                                                            
  institutions. Basing on the knowledge and the community you live in, 
  
  a) Identify any financial institutions known to you.
  b) Do you think those financial institutions are important in managing local 
  

  businesses? Support your answer.  

  6.1. Meaning of financial institutions
   Activity 6.1
   i) Read the case study and answer the questions that follow;
   Keza started up a project of making paper bags at school having seen that 
  a lot of paper was trashed and littered around the school compound. She 
  sold these paper bags to the neighboring shops. She got a lot of money 
  and felt insecure to keep it in the dormitory, so she thought of opening 
  an account in the nearby bank. She also thought of saving the money in 
  the bank so that it accumulates interest and also in the long run acquire a 
  loan and expand her business by making flower vases, artefacts.
  
   a) Do you think Keza took a wise decision? Why?
   b) If it were you, what would you do to feel secure with the money 
  while at school and why?
   c) How would you define financial institutions?
  

  ii) Differentiate banking from non-banking financial institutions.

  
  

   Financial institutions are institutions that deal in providing financial services 
  to their clients. They offer both short- and long-term finance to entrepreneurs 
  for their business operations. Financial institutions include; Central bank, 
  commercial banks, microfinance institutions, merchant banks, development 
  banks, Savings and Credit Societies and insurance companies etc. 
  
  Financial institutions provide a variety of financial services to the public which 
  include deposits and withdraw services, loan services and financial advice to 
  

  entrepreneurs among others.

   Types of financial institutions
  a) Banking financial institutions are financial institutions that are authorized 
  to receive deposits and create credit. These banking institutions include:
   1. Central bank, 
  2. Commercial Banks
  3. Other Banks:
   • Development Banks
   • Savings and Credit cooperatives (SACCOs)
  

   • Micro finance institutions and Microfinance banks. etc

  b) Non- banking financial institutions these are institutions that accept 
  deposits but don’t create credit and offer other bank related services such as 
  investment and risk pooling. 
  
  Examples include: 
   -Insurance companies
   -Building societies
   -Pension funds
  

   -Capital markets

   Application Activity 6.1
   Imagine you are to start up a business in your community.
   a) Which type of financial institution will you work with closely and why?
   b) Why would you insure your business?
   
  6.2. Factors for selecting suitable financial institutions to deal with
   Activity 6.2
   Analyse the factors that would be considered to choose a suitable 
  financial institution to work with.
  There are several factors considered while selecting suitable financial 
  institutions which include the following:
   
  i. Interest rate: In case of borrowing money from the banks. Entrepreneurs will 
  opt for banks with lower interest rate and when it comes to entrepreneurs 
  saving their money in banks, they will prefer a relatively higher interest rate.  
  ii. Proximity: Most people will prefer banks that can easily be accessed. This 
  means institutions that have many branches.  
  iii. Customer care: Financial institutions which provide good customer care 
  are normally liked than those without.  
  iv. Payback period: Refers to the time taken to recover the initial investment. 
  Financial institutions that give a long pay back period are normally considered 
  preferable than those that give short payback period. 
  v. Terms and Conditions of issued loans: Financial institutions that provide 
  soft loans are chosen faster than those that give hard loans. Soft loans are 
  loans with low interest rate or not at all.
   Vi. Legal procedures: The financial institutions that have licenses to operate 
  and are recognized by the central bank are always preferred.  
  vii. Time of operation: It is better to deal with a well-established financial 
  institution than a newly established one. In other words, it is better to deal 
  with those that have been in operation for a longer period than new ones.  
  viii. Collateral Security required: Banks which don’t require a lot of collateral 
  

  security are always considered by most people. 

  Application Activity 6.2
   Role play on the factors for choosing a suitable financial institution to 
  deal with.
   Visit a nearby financial institution to identify services offered by that 
  

  institution

  6.3. Services offered by financial institutions

  
  

   Activity 6.3

   Examine the services offered by:

   a) Commercial banks

   b) Central bank

   c) Insurance companies

   Various services offered by financial institutions:

   Central Bank (National Bank) Eg: BNR- National Bank of Rwanda

   • Issuing of currency: The National Bank is the only bank that is authorized 

  to issue and renew the old notes and coins of a given country. 

  • It is a banker to all other commercial banks. 

  •  It stabilizes the country’s currency in circulation by using various 

  monetary policies. 

  • It acts as an advisor to the government on issues regarding the economic 

  situations like how to control inflation, etc  

  • It acts as a lender of last resort to commercial banks. 

  • It manages the government debts that is both internal and external 

  debts. 

  • It licenses, controls and supervises all the banking activities of 

  commercial nature.

   • It’s a banker to international institutions working in the country e.g. 

  FAO, Red Cross, WHO, UNICEF etc. 

  Y2_Entrepreneuship_SB.indd   91 22/07/2020   04:44:43

  Commercial Banks ( Eg: BK, Equity Bank, KCB, I&M Bank, etc)

   • They accept customer’s deposits.

   • They also advance short and long term-loans to the public in order to 

  generate interest as profit.

   • They facilitate easy transfer of money nationally and internationally 

  and from one account to another.

   • They facilitate international trade through offering or selling travelers 

  cheques. 

  • They provide foreign exchange services where one can easily exchange 

  one currency to other currencies. 

  • They provide overdrafts to clients that is, where one can withdraw 

  money which is in excess of  his / her bank account balance. . 

  • Most commercial Banks provide financial training.  

  • They provide a variety of accounts to the public to be used when 

  depositing or withdrawing their money each with varying benefits 

  such as savings accounts, fixed deposit accounts, current accounts etc. 

  • They act as referees or trustees where one can trust them to safeguard 

  valuable items like land titles, car log books, Wills and other valuable 

  items. 

  • They act as agents of stock exchange. They buy/sell shares of different 

  limited companies on behalf of their clients.  

  • They provide foreign exchange to the customers operating foreign 

  exchange accounts e.g. dollar accounts. 

  • They also protect business properties.

   Insurance companies (Non Banking Financial institutions)

   An insurance company refers to a business that provides coverage, in the form 

  of compensation resulting from loss, damage, injury, treatment or hardship in 

  exchange for premium payments. The company calculates the risk of occurrence 

  then determines the cost to replace (pay for) the loss to determine the premium 

  amount. Eg: RADIANT, CORAR, SAHAM, UAP, BRITAM, etc

   The following services are offered by insurance companies:

   • Business Insurance,

   • Professional Indemnity,

   • Property Insurance. ...

   • Motor Insurance,  

  • Home & Contents Insurance,

   • Cyber Insurance, etc

  
  

  Application Activity
   a) Carryout research on any two financial institutions that are near your 
  school and evaluate the services they offer.
   b) Select an appropriate financial institution to deal with in your school 
  business club. Give reasons to justify.
   
  6.4. Role of financial institutions in social economic development
   Activity 6.4
   Describe the role of financial institutions in social economic development
  Financial institutions play an indispensable role in the overall development of 
  a country. They include the following;
   
  a. Financial institutions play a key role in creating employment in an 
  economy. Many people are employed in different financial institutions thus 
  improving their wellbeing.
   b. They help to control inflation in the country by use of the monetary policy 
  tools.
   c. They provide loans to the public which are used to start-up businesses 
  hence improving their standards of living. 
  d. They offer a safe custody for the public finances thus reducing cases of 
  theft.
   e. Financial markets help in boosting economic growth. They encourage 
  people to save by buying shares and bonds and then use it to invest in large 
  projects and industries.
   f. Financial institutions do offer loans to businesses at substantial interest 
  rates. This helps businesses to increase their production and distribution 
  activities.
   g. They promote foreign exchange markets through supporting entrepreneurs 
  in exporting and importing goods and services. Businesses can receive and 
  transfer funds in other currencies.
   h. Economic growth depends on the growth of infrastructural facilities of the 
  country. These infrastructures require a lot of funds which are funded by 
  these financial institutions.
   i. They also help to facilitate domestic and international trade.
   j. They help to balance economic growth since all the different sectors in an 
  economy rely on financial institutions. The primary, secondary and tertiary 
  sector industries all need sufficient funds from these institutions.
   k. They help to attract foreign capital through the capital market authority. 
  Foreign companies can buy shares, stocks in another country. Such as KCB, 
  IM bank, equity bank among others. 
  l. Financial systems of different countries can promote economic integration. 
  This is when common economic policies, such as common employment 
  laws, commercial laws are applied. For example, the East African 
  Community (EAC).
   m. They also help in the development of new technology to be used. For 
  instance, computers and other new technologies to be used in recording 
  information. 
  In general, financial institutions play a key role in social economic development 
  of any economy and no economy can run successfully without a sound financial 
  

  system.

   Application Activity 6.3
   Write an essay on the following statement: “Financial institutions are 
  

  the key engine to the development of the country”

   Skills lab 6
  a) As future entrepreneurs, discuss the financial needs you have in your 
  school business club. 
  b) Research on the internet and through resource persons in your 
  community for the terms and services offered by other financial 
  institutions as much as savings and credit cooperatives are concerned. 
  Then, compare with those discussed in this book and choose the one 
  that is more appropriate to your business club.  Give clear reasons as 
  

  to justify your choice.

   End of unit 6 Assessment
   1) As an entrepreneurship student, choose two suitable financial 
  institutions to work with in the school business club and give reasons 
  why you chose the above institutions? 
  2) Why is the government of Rwanda encouraging people to invest in 
  

  capital markets?

• UNIT 7: QUALITY ASSURANCE AND QUALITY COMPLIANCE IN BUSINESS

  

  

  Key Unit competence: To be able to maintain effective quality compliance 
  

  system in business.

  Introductory activity
   Quality assurance and Compliance Case Study:
   The government of Rwanda through Rwanda Standards Board is mandated 
  to provide National standards and conformity assessment guidelines 
  that entrepreneurs/traders ought to follow during production and selling 
  of their goods and services. These guidelines help entrepreneurs to be 
  cautious and careful with the quality and measurements of raw materials 
  used, goods produced and the technology used. If your business conforms 
  to the required quality management, assurance and compliance standards, 
  it reduces mistakes and inconsistencies that could make these goods unsafe. 
  If you manufacture a food product, your quality control processes should 
  monitor temperature and foreign bodies to decrease the likelihood that 
  you will make someone sick. Ensuring customer safety saves your business 
  

  money and averts damage to your reputation.

  One of the ways that the business can strengthen its quality is by listening to 
  its customers and incorporating their feedback in the business processes and 
  production systems. Product quality issues that customers normally report 
  should be tracked and managed through a rigorous process of investigation 
  and resolution. These and more processes help the business to continually 
  enhance customer satisfaction. It’s also important that businesses are 
  

  genuine in their measurements of goods produced and sold.

   Questions
  Referring to the above case study, answer the following questions below;
   a.What does the National Standards and conformity assessment 
  guidelines expect entrepreneurs to do ?
   b. What are likely negative effects the business may face if customers are 
  not satisfied as a result of wrong measurements of the goods bought ?
   c. What strategies would you propose to the entrepreneurs to implement 
  and ensure the safety of their customers?
   d. Design a simple quality management system of the business idea you 
  

  intend to start in your community.

  7.1. Quality assurance and quality compliance
   Activity 7.1
   Explain the meaning of:
   1. Quality assurance,
   2. Quality compliance and 
  

  3. Quality management

   7.1.1. Meaning of quality assurance
   Quality assurance (QA) is any systematic process of determining whether a 
  product or service meets specified requirements. It is also referred to as the 
  maintenance of a desired level of quality in a product or service, especially by 
  means of attention to every stage of the production process  or delivery.
   
  A quality assurance system is meant to increase customer confidence and a 
  company’s credibility, while also improving work processes and efficiency, and 
  it enables a company to better compete with others.
  
  Quality assurance is very important because it helps a company create 
  products and services that meet the needs, expectations and requirements of 
  customers. It yields high-quality product offerings that build trust and loyalty 
  with customers. The standards and procedures defined by a quality assurance 
  program help prevent product defects before they arise. Quality assurance 
  

  includes two principles: 

  1. “Fit for purpose” (the product should be suitable for the intended 
  purpose); and 
  2. “Right first time” (mistakes should be eliminated). 
  It includes management of the quality of raw materials, assemblies, products 
  and components, services related to production, and management, production 
  

  and inspection processes

   7.1.2 Meaning of quality compliance
   Quality compliance means acting in accordance with systematic processes of 
  determining whether a product or service meets specified requirements at 
  every stage of the production process or delivery. Complying with the quality 
  requirements helps the business in different ways such as satisfying customers’ 
   needs, increasing the level of sales due to a large number of customers attached 
  to the product or service, complying with the state’s quality requirements 
  

  among others.

   Application Activity 7.1
   Using typical examples differentiate quality assurance from quality 
  

  compliance.

  7.2. Measurement standards
  Activity 7.1
  

   1. Study the illustrations below and answer the questions thereafter.

  
  

  
  

  
  

  a) What do you observe in the above illustrations?
   b) What lessons do you learn from the above illustrations?
   c) Why should buyers of given products make sure that products 
  

  bought conform to the right measurements?

  2. Based on your knowledge in Physics(O’level), explain the measurement 
  

  standards used in business activities

   Measurements are often made using instruments such as measuring tapes, 
  weighing scale, rulers, clocks, etc. Measurement is a comparison process. It 
  involves comparison of the quantity to be measured with a chosen standard 
  or unit. In the past, for example, the length of an object was compared with 
  familiar lengths: strides, length of a man’s foot, arm and fingers. Ancient people 
  also used stones or seeds as their standards or units to measure weight. The 
  position of the sun and the moon were used to tell time and seasons, the 
  dimensions of the human body. Below are some of measurement standards 
  

  that are used in business activities.

  The base quantities according to the International System of Quantities 
  

  (ISQ) are listed in the following table:

  
  

   Other quantities are derived from the base quantities and some of them 
  

  are listed in the table below.

  
  

  Examples of measurements in business (measurement standard and 
  

  measurement materials)

  
  

  Application Activity 7.2
   For the business you intend to start in your community, analyse different 
  

  measurement standards you would emphasize, and why?

   7.3. Meaning and relationship between quality 
  management, assurance and quality compliance
   Activity 7.3
   Describe the relationship between quality management, quality 
  assurance and quality compliance
   
  It is important for businesses to pay close attention to Quality Assurance (QA), 
  Quality Compliance (QC) and Quality Management (QM) since they form an 
  integral part of the business’ success. Customer satisfaction and maintenance 
  (customer retention) rely heavily on the applicability of the quality assurance, 
  compliance and management in production and management processes.
  
  Looking at the above illustration, quality assurance and compliance must be 
  managed and controlled by the given quality control department of the business. 
  The illustration shows that if businesses have clear processes of managing 
   quality and abide to laws and guidelines set by regulatory body (RSB), then 
  there is quality management.
   
  The relation between the three in terms of standards means that quality 
  management system is comprised of quality assurance and compliance activities 
  that ensure the establishment of a set of quality policies and objectives which 
  act as guidelines within an organization or business.
   
  Quality Management system
   A Quality Management System (QMS) is a formalized system that documents 
  processes, procedures, and responsibilities for achieving quality policies and 
  objectives.
  
  For businesses to be able to promote quality standards, they need to develop 
  quality management system. This system becomes part and parcel of business 
  culture and it is monitored by the business’ quality control team. The following 
  is a quality management system that can be used by business to promote and 
  ensure the quality of their products or services:
   
  i) Define and document necessary components of quality management 
  system. This would include key guidelines and elements of what the business 
  takes as quality. For example what kind of raw materials will have to be used.
   
  ii) Define the quality policy. This includes the business’ mission that is what 
  customers want and value from the business. This should be given top 
  priority in the business.
  
   iii) Quality objectives must be communicated to the team and well 
  understood, ISO requires that quality objectives are derived from quality 
  policy and measures.
   
  iv) Define the product defect; that is what contributes to poor quality, 
  whenever such defects are seen they must be recorded and communicated 
  accordingly.
  
  v) Develop the documents for the system. This could be a manual that 
  includes the necessary policies, procedures and forms. 
  
  vi) Define the quality process; this includes corrective and preventive action 
  process, management review and communication process. In short this 
  involves ways of solving given challenges to quality implementation.
  vii) Determine the training needs; Entrepreneurs must identify the gaps 
  within the team so that the workers are trained and supported accordingly 
  to meet and comply with quality standards.
  viii) Use the system. This is the stage when the system is implemented 
  accordingly.
   ix) Measure and monitor performance. Measuring performance happens 
  after implementation and would vary greatly from organization to 
  organization depending on size, potential risk, and environmental impact.
   x) Take action that improves performance. This is the last step that is 
  implemented and when solutions to the risks are identified as per the quality 
  

  process, they communicate them to the employees.

   Application Activity 7.3
   1. Interrelate quality management, quality assurance and quality 
  compliance
   2. Think about businesses that exist in your community, how have they 
  

  failed to observe quality expectations?

   7.4. Levels of accreditation and accreditation bodies
  

   Activity 7.4

   1) What do you understand by the term accreditation?
   2) Identify levels of accreditation and accreditation bodies.
   Accreditation is one of the critical quality infrastructure elements that facilitate 
  trade. Accreditation of conformity assessment bodies provides the acceptance 
  of tests results, inspection reports and certificates that accompany products 
  and services traded across borders.
  

   There are three levels for accreditation which include the following;

   National standards
  The national standards body helps to develop consensus-based standards. 
  As such it considers the balanced views of all stakeholders (traders, industry, 
  consumer associations, regulators, academia, research institutions, Non
  Government Organizations etc.) the standards developed at the national level 
  can also be used as inputs to develop international standards.
  
  Examples of national standard bodies in Rwanda: Rwanda Standards Board, 
  Rwanda Environmental Management Authority, Ministry of Health, Rwanda 
  Development Board, Rwanda National Police, Ministry of Agriculture and 
  

  Animal Resources etc.

   Regional standards
   These are standards set in each region such as EAAB, East Africa Community 
  Standards (EACS) to enforce standard of goods and services in each region. They 
  promote trade and commerce in accordance with the progress and prosperity 
  

  of a given region.

   International standards
   The international standards bodies develop standards at the international 
  level. They are composed of representatives from various national standards 
  bodies. They help to overcome technical barriers in international trade. 
  Examples of such bodies include, International Organization for Standards 
  

  (ISO), International Electro-technical Commission (IEC)

  
  

  Application Activity 7.4
   1) Visit the Rwanda Standards Board website and research about 
  products made in Rwanda with S mark and ISO.
   
  2) Research from internet to come up with different recognized 
  

  accreditation bodies which ensure quality compliance.

  7.5. Role of quality compliance in business 

   Activity 7.5

   Why is it important to comply with quality requirements in business?

  
  

  Compliance means meeting the regulatory requirements.
  
  1) Quality compliance in business ensures that the product satisfy their 
  intended use.
   2) It also reduces the risk of fines, penalties and closure of businesses. When 
  a business does not meet some compliance requirements it faces the law.
   3) It leads to improved health and safety.
   4) It leads to improved health and safety quality improvement.
   5) Quality compliance maintains or increase market share for the 
  businesspeople.
   6) There is fair competition among businesses hence increasing customers 
  

  satisfaction from the products.

   Application Activity
   1.Research on the Rwanda Standards Board website about the 
  requirements needed to get an ‘S’ mark for the products in the 
  school business club. 
  2. 2) use the link below and explain the importance of the program  
  

  “Zamukana Ubuziranenge “http://ryaf.rw/?p=2333

   Skills lab 7
   For any product you produce in the school business club: Discuss and 
  write down the steps, measurements and procedures of making that 
  product to ensure standardization of practices in your business, align 
  with the acceptable RSB standards and make an action plan to acquire 
  RSB certification for services or products that your business club 
  

  produce or offer. Then, share with the class.

   End of unit 7 Assessment
   1. James and Rosset intend to start a business of making Chapati and 
  mandazi, but they have a challenge ensuring consistency in quality 
  (maintaining the same test, size and thickness) . With your knowledge 
  on quality assurance and standardisation; 
  a) Advise  James and Rosset on how they can set quality standards 
  in their business.
   b) What measurement tools could they use to achieve the quality 
  standards?
  2. Explain the importance of accreditation for certification services and 
  

  testing laboratories.

• UNIT 8: FINANCIAL STATEMENTS

  

   Key Unit Competence: To be able to recognize the value of accounting in 
  

  managing the business.

  Introductory activity

  Financial Statements “The language of business decision making.”
   James is a local entrepreneur in Huye town, he is so passionate and 
  committed to solve community problems in his home town and country, he 
  started a crafts business in Huye town, he moves to villages and collect crafts 
  from women groups and put them in his shop which is strategically placed 
  to target tourist heading to Nyungwe forest and Akanyaru Centre. He had 
  a book where he instructed his workers to be recording all sales for each 
  day, supplies and operating expenses. He believed that this is the best way to 
  keep track of all business transactions and a sure way to growth.
  
  He wanted to expand the business and felt that 5 million Francs would be 
  enough. He was advised by his sister Uwera a student of entrepreneurship, 
  to approach investors and bankers and pitch his business and convince them 
  to provide funding to enable him to meet the business growth needs.
  
  The investors only gave him 10 minutes to explain the profitability of his 
  business, the net financial position and the financial projection he needed 
  for the next 2 years, but this challenged him because the book he kept could 
  not easily provide this information in the given time, so he failed to convince 
  the investors and missed the funding.
  
  James realized that he needed to have organized the financial information he 
  was keeping in a certain order that would enable him to make quick decisions 
  

  and make it more presentable and easy to explain to external stakeholders.

   Questions:
   1. What kind of documents James would have used to organize his 
  business’s financial information before presenting to investors?
   2. What do you understand by financial statements?
   3. What is the difference between financial statements and the books of 
  accounts? Give examples of each.
   4. Why is financial information important to any business?
   5. What is the purpose of financial statements in business?
  

   6. Distinguish between income statement and balance sheet 

  8.1. Meaning and importance of Financial Statements

  Activity 8.1
  

  Study the quote below and respond to the questions that follow.
  

  
  

  1.What does the quote above mean to you as a student of 
  entrepreneurship?
   2. Why does the author of the quote emphasize the reliability of the 
  financial statements? 
  3. What is the meaning of financial statements?
   4. What financial statements should every entrepreneur use to 
  

  communicate and manage businesses effectively? Why?

  8.1.1. Meaning of Financial Statements 
  Financial statements are reports prepared by a company’s management to 
  present the financial performance and position of a business at a point in time. 
  Financial statements consist of four statements namely:
   1. Income statement
   2. Balance sheet
   3. Statement of owner’s equity and
   4. Cash flow statement
   
  Generally, the most important financial statements are:
   (i) The income statement / Financial performance statement or Trading, profit 
  and loss account.
  

   (ii) Balance sheet or the Financial position statement.

   8.1.2. Importance of Financial Statements
   Evaluation
   It’s possible to assess future cash flows, and compare economic and financial 
  results year by year.
   
  Internal Decision Making
   The management can use all the information to guide and lead the company 
  through future performances.
   
  Planning
   Financial Report can be the basis to plan the activity, allocate resources, schedule 
  

  Activities  etc.

   External Decision Making
  

   External users can evaluate the possibility to invest in the business or company

   Application Activity 8.1
   With clear examples, explain the reasons why the following people may 
  be interested in looking at the financial statements of any business?
   -Employees
   -Business Manager
   -Entrepreneur
   -Government
  

   -Investors

   8.2 Income statement (Trading, Profit & Loss Account)
   Activity 8.2
   “An income statement is mostly important for well established companies 
  like Bralirwa, Rwandair, among others, a developing entrepreneur only 
  needs a book to record day to day transactions” 
  a. Do you agree with the above assertion? Explain your decision.
  

   b. What is an income statement?

  Main elements of Income Statement

  
  

  Income statement is a financial statement that reports a company’s financial 
  performance over a specific accounting period. Financial performance is 
  assessed by giving a summary of how the business incurs its revenues and 
  expenses through both operating and non-operating activities. The income 
  statement is made of two accounts:
  
  • Trading account where the value of the gross profit is determined by 
  

  deducting the cost of goods sold from net sales i.e.  

  
  

   1) Trading account 
  Trading account is an account which is prepared to determine the gross profit 
  or gross loss of the business concern. It shows the revenues from sales, the cost 
  of those sales or goods sold and the gross profit or loss from the specific period 
  ended. It is prepared after the preparation of the trial balance. 
  
  Items found in a trading account:
   a) Sales: Refer to the value of goods which were bought for resale and have 
  been sold by the business. It is revenue earned from goods sold. They are 
  entered in the trading account for the purpose of calculating gross profit or loss.
   
  b) Sales return: Roods that were previously sold but have been returned to the 
  business due to different reasons including but not limited to poor quality/ 
  

  defects, wrong pricing and delayed delivery. 

  
  

  c) Opening stock: Unsold goods in the business available at the beginning of 
  the new trading period.
  d) Purchases: Goods bought by the business for resale.
  e) Purchases return: Goods previously bought by the business for sale but 
  have been sent back to the suppliers. This value is treated in the trading 
  

  account and its subtracted from the purchases to get the net purchases i.e. 

  

   f) Carriage inwards: Refers to the cost of transporting the goods or bringing 
  the goods up to the premises. It forms part of the goods bought hence added 
  

  to purchases in the trading account.

  

  g) Closing stock: Goods not sold by the business at the end of a trading period. 
  It’s included in the trading account and it is subtracted from the goods 
  

  available for sale to get cost of sales. i.e:

  

  h) Drawings of goods: Sometimes an entrepreneur may take physical items 
  out of the business for private use. This must be subtracted from the goods 
  available for sale in the trading account. It should be noted that “only 
  drawings in form of goods”  must be treated in the trading account.
   
  i) Gross profit: Excess of net sales over the cost of goods sold or cost of sales. It 
  also refers to the total profit obtained by an enterprise before paying off the 
  operating expenses. Thus 
  Gross profit = net sales – cost of sales
  

  j) Gross loss: This is excess of cost of sales over the net sales of the business. 

  Format of a trading account
   There are basically two formats that are used to prepare a trading account. i.e 
  a) Horizontal 
  b) Vertical format
  

  Horizontal format / T - Format

  
  

   Note: 
  • Goods available for sale (GAS) = Opening stock + Net purchases
   • Cost of Goods Sold (COS) = Goods Available for Sale – Closing stock.
   • Gross profit = Net sales – Cost of Goods Sold
  
   Vertical format of an Income statement
   Income statement for the year 
  

  ended. date 

  
  

  
  

  
  

  
  

   b) Notice use of brackets on the amounts mean deduction of the amount. The 
  other option would be to use the word ‘Less’ before the item concerned.
   
  Profit and Loss account:
   As seen in the above vertical format of an income statement, you will realize 
  that  Profit and Loss account part represent the company’s NET PROFIT or 
  NET LOSS which is determine by deducting operating expenses (these include 
  

  selling and distribution expenses and administrative expenses) from the Gross income.

  
  

  Application Activity 8.2
   KUNDUMURIMO Enterprise showed the following balances as on 31st 
  

  December 2012 

  

  Required: Prepared an income statement for KUNDUMURIMO 
  

  Enterprise for the period ended 31st December 2012.

  8.3. Balance sheet

  
  

  Activity 8.3
  

  
  

  
  

  A balance sheet is a statement of assets and liabilities of a business organization 
  at a given period of time. It is a statement that shows what you own, what you 
  

  owe, and what you are worth at the end of each accounting period.

   A balance sheet is not an account therefore, not part of the double entry but 
  it is prepared based on the ACCOUNTING EQUATION, which states that:  Assets 
  =capital + liabilities. That is why a balance sheet is also defined as “a statement 
  

  in which the business accounting equation is expressed” 

  Parts of a balance sheet:
   There are three major parts of a balance sheet;
   • Assets
   • Liabilities
  

   • Capital / Owner’s equity

   Assets
   These are possessions owned by the business and have got money value. 
  They are grouped into two;
   • Fixed assets
   • Current assets
   a) Fixed assets: These are the possessions of the business which are of a 
  durable nature bought for use in the business for a long period of time 
  usually above one year. E.g. land, equipment, machinery, fixtures and fittings, 
  

  motor vehicle etc.

   b) Current assets: Possessions or properties of the business which lasts for 
  a short time and usually easily changed into cash. Current assets keep on 
  being converted from one form to another e.g. stock of goods, debtors,  cash 
  at hand , prepaid expenses or expenses paid for in advance, outstanding 
  

  income etc.

   Liabilities
   These are debts or amount of money that the business owes the outsiders. 
  They are claims of outsiders on the business’ assets. They are also properties/
   possessions that are used by the business and which must be paid back in the 
  future. There are 2 types of liabilities: 
  • Long term liabilities
   • Short term liabilities
   a) Long term liabilities:  These are debts of the business that are expected to 
  be paid after a long time usually after one-year e.g. bank loans, debentures.
   b) Short term liabilities/current liabilities: These are debts of the business 
  which are to be paid within a short time usually within a year. They are claims 
  by outsiders of the business that are repaid within one accounting year e.g. 
  trade creditors, bank overdraft, outstanding expenses, prepaid income etc.
   
  Capital
   These are the resources invested by the owner or the entrepreneur in the 
  business. Capital is also known as owner’s equity. To start any business a person 
  requires capital; which can be in the form of money or other physical resources.
   
  The balance sheet can be reported in two different formats: Horizontal format 
  referred as account form and Vertical format referred to as report form. 
          • The Horizontal format consists of two columns displaying assets 
             on the left column of the report and liabilities and equity on the right 
  

            column. 

   An example of the balance sheet in horizontal format:
  

   BALANCE SHEET AS AT ……/………/……….    

  
  

   • The Vertical format, on the other hand, has only one column. This 
  form is one of the most widely used today.  Assets are always presented 
  

  first, followed by liabilities and equity.  

  An example of the balance sheet in Vertical format:

  
  

  
  

   Also assets and liabilities can be arranged according to their realization and 
  payment preference, which is called liquidity order basis or on the assumption 
  that these will be sold and paid only on the liquidation of business which is 
  called the permanence/fixity basis.
    
   Application Activity 8.3
   Analyse the accounting information below in the trial balance and 

  discuss the questions that follow.

  

  Required:
  a) Prepare KALISA’s Balance sheet as at 31st Dec. 2011
  b) What advice would you give KALISA to improve on his business’s 
  

  financial position?

   Skills lab 8
  Use the current financial data you have so far in the business club and 
  prepare an income statement and a balance sheet (or projected income 
  statement & Balance sheet) for your business club. Analyse the Income 
  statement and Balance sheet, describe the net financial position of the 
  business club. Basing on the financial position, suggest action steps to 
  improve the financial life of your Business club.
   
   End of unit 8 Assessment
   1) The following information was obtained from the books of Kaneza 
  

  and Kamali Ltd Company as at 31 March 2010.

  
  

   You are required to:
   a) Prepare the business balance sheet as at 31 March 2010 in both 
  formats (Horizontal and vertical).
   b) How do you describe the financial status of Kaneza and Kamali 
  Ltd Company given their balance sheet status?
   2) The following was extracted from the books of Alexis traders Ltd as 
  

  at 31^st December 2011

  
  

  
  

  Additional Information:
   • Stock at 31st December 2011 was valued at 42,000Rwf.
  
   Required:  
  Using a Vertical format, Prepare Alexis traders’ Ltd trading, profit and 
  Loss account for the year ended 31st December 2011.
   What advice would you give to the business operators given the nature 
  

  of the profit and loss account?

• UNIT 9: RIGHTS AND RESPONSIBILITIES OF WORKERS AND EMPLOYERS

  
  

  Key unit competence: To be able to demonstrate rights and responsibilities of 
  employees at  workplace.
  
  Introductory activity
  OPTIMISMUS Ltd is a company based in KAJEVUBA village. When AKALIZA, 
  a head of production department claimed to correct some dangerous 
  aspects in the production system, MAHORO, the Managing Director refused 
  because it could take 2 weeks to fix the problem while it was a period of busy 
  production due to a big number of orders received  from the company loyal 
  customers. When AKALIZA was called to report to the Managing Director’s 
  office to discuss about that issue, she rudely talked to MAHORO, Director of 
  the company accusing him of not caring about the lives of workers in her 
  department.   
  1. Describe the rights that have been violated in regard to employment 
  relationship.
   2. Basing on the scenario above, identify responsibilities which have not 
  been fulfilled on both employer and employee sides.
  
  9.1. Meaning of rights and responsibilities
   Activity 9.1
   In 2019, GIRAMAHORO Enterprise dealing in agricultural activities was 
  established and based in NTARABANA sector. For the smooth running 
  of the business, the owner took an initiative of using his employment 
  right to recruit five new workers (employees) to help in achieving the 
  business objectives. On one hand, some of the main responsibilities of 
  an employer is to clearly show the worker’s tasks, to train new workers 
  for better performance of the tasks, and pay the workers regularly for 
  the work done. Besides, the earlier stated responsibilities of employers 
  are to give rights to the five recruited workers. The later have 
  responsibilities of performing the tasks as instructed by the employer, 
  to report at work on time, etc.
   Referring to the above case, answer the following questions:
   1. In the case study above, the enterprise owner had the right to hire 
  workers. What do you understand by rights?
   2. Basing on the workers’ responsibilities stated in the case study, 
  explain what you understand by responsibilities.
   3. Explain the difference between rights and responsibilities.
  
  Rights are moral or legal, social, entitlement to have or do something. That is, 
  rights are the fundamental normative rules about what is allowed of people 
  or owed to people, according to some legal system, social convention, or 
  ethical theory. Examples: Right of peaceful assembly and association, Right to 
  participate in government and in free elections, Right to be considered innocent 
  until proven guilty, etc.
  
  Responsibility is the state or fact of having a duty to deal with something or 
  of having control over someone. It is also referred to as a state or fact of being 
  responsible, answerable, and accountable for something within one’s power, 
  control, or management. E.g. an employer is responsible to supervise the 
  worker and make sure that the work is done in suitable conditions as far as 
  security, health and dignity of the worker are concerned
   
  Workers’ rights or labour rights are a group of legal rights and claimed human 
  rights having to do with labour relations between workers and their employers, 
  usually obtained under labour and employment law. In general, these debates 
  are about negotiating workers’ pay, benefits, and safe working conditions. 
  
   Application Activity 9.1
   Youth are a rapidly growing percentage of the Sub-Saharan African 
  population, and many are economically vulnerable. Financial inclusion 
  for youth, particularly the promotion of savings behavior is associated 
  with a number of positive social and economic outcomes and is an 
  international priority. However, the majority of youth in Sub-Saharan 
  Africa are not saving.
   The following are the rights and responsibilities of workers. Based on your 
  understanding and skills, tick the following statements where appropriate;
  
  

  
  9.2. Examples of rights and responsibilities of workers 
  and employers
  
   Activity 9.2
   1. Read the following scenario and answer the questions thereafter.
   KEZA is a newly-hired employee at a restaurant based in Kajevuba 
  village. KABERA, the human resource manager, pays a lot of attention 
  to her. At first, she feels flattered, but when he starts touching and 
  cuddling her she worried. She wants him to stop but is afraid that 
  if she says anything she might lose her job or strain the working 
  relationship.
   
  Required:
   a. How were KEZA’s  rights  violated?.
   b. Discuss the obligation of an employer that was ignored by KABERA 
  the  line manager to KEZA.
   
  2. Read the following extract, and answer the questions that follow,
   Labour  law covers all rights and obligations within the
   employer
  employee relationship whether current employees, job applicants, 
  or former employees. Because of the complexity of employment 
  relationships and the wide variety of situations that can arise, labour 
  law involves legal issues as diverse as discrimination, wrongful 
  termination, wages and taxation, and workplace safety. 
  
  Many of these issues are governed by applicable  state law. But, where 
  the employment relationship is based on a valid contract entered into 
  by the employer and the employee, state contract law alone may dictate 
  the rights and duties of the parties.
   (a) Describe any 3 rights of workers in a business .
   (b) Explain any 4 responsibilities of the workers in the business.
   
  9.2.1. Rights and responsibilities of workers
   Employers and employees have responsibilities to each other; they should 
  also expect their rights to be upheld. These rights and responsibilities relate 
  to areas such as Health and Safety, the provision of terms and conditions of 
  employment, equal opportunities and the right to be paid a minimum wage.
   
  Employees have the right to:
   1. Be given by the employer the agreed work  conditions, at the time and place 
  as agreed;
   2. To implement the work contract signed with the employer;
   3. To be paid by the employer the agreed remuneration regularly and in due 
  time;
   4. To be affiliated by the employer to the social security scheme;
   5. Enjoy the rights that are provided for workers with dependents by the law;
   6. To enter into a performance contract with the employer based on collective 
  negotiation within the establishment;
   7. Work in a respectful, inclusive work environment free of discrimination;
   8. A safe and healthful workplace;
   9. Ask employer to correct dangerous conditions;
   10. Receive training from employer;
   11. To be given the needed means for the execution or completion of the work;
   12. To benefit from all legal provisions related to the work.
   
  The responsibilities of the worker
   According to the article 48 of Labour law in Rwanda, the worker has the 
  following:
  
  Principal responsibilities:
   1. To personally carry out the duties of his/her position: The worker must 
  personally execute the contract of employment in the time, place and under 
  conditions agreed between the parties. He/she is not competent to request a 
  third party to do his/her job or to assist him/her without the consent of the 
  employer even when the remuneration of the third party will be paid by the 
  employee or gratuitous.
   2. To respect the employer’s or his/her representative’s orders when given so 
  as to have the work done.
   3. To abstain from all that might threaten his/her security or that of his/her 
  companions or third party, or jeopardize his/her dignity and the one of his/
   her colleagues.
   4. To respect workplace rules, regulations, policies and legislation prescribed 
  by the establishment, its branch or the place where he/she is to do his/her 
  work.
   5. To keep in good conditions tools given to him/her and give them back to the 
  employer at the time the work is completed. 
  6. Treating clients, coworkers and the public with respect and dignity.
   
  9.2.2. Rights and responsibilities of employers
   The employer has the following principal rights:
   • Hiring rights: The employers have the right to hire the workers in 
  accordance with proper procedures and to expect reasonable performance 
  from their employees.
   • Firing an employee: Basing on some legal reasons and after official 
  warnings, the employer has the right to fire an employee. Some legitimate 
  reasons for firing a worker include:
   - Poor performance/productivity problems
   - Gross misconduct/unprofessionalism at work
   - Stealing
   - General layoffs, etc.
   • To see his orders respected: An employee is required to respect 
  the orders of the employer or his/her representative when given in 
  furtherance of work, but the level of devotion required of an employee 
  should not exceed his obligations. In as much as the employee owes 
  the entirety of his professional activities to the enterprise, nonetheless, 
  outside his working hours, it is lawful for him to perform any activity of 
   a professional nature which is not harmful to the proper execution of his 
  obligations as per the terms of his contract of employment.
   • To see his work well executed: The employer has the right to see the 
  work wholly done by the worker in the time, place and under conditions 
  agreed between the parties.
   • To see all legal provisions in his favor being respected: The employee 
  is required to respect all obligations contained in the contract of 
  employment. If the employee is in breach of his/her contractual obligation, 
  he may be liable to indemnify the employer.
  
   The employer has the following main responsibilities:
   • To give to the workers the agreed work conditions;
   • To ensure the responsibility of implementing the work contract signed on 
  his/her behalf;
   • To supervise the worker and make sure that the work is done in suitable 
  conditions as far as security, health and dignity of the worker are 
  concerned;
   • To pay the worker the agreed remuneration regularly and in due time;
   • To avoid whatever may hamper the company’s functioning, its workers 
  and the environment;
   • To affiliate workers to the social security scheme;
   • To make those workers with dependents enjoy the rights that are provided 
  for by the law;
   • To enter into a performance contract with the worker based on collective 
  negotiation within the establishment;
   • Ensuring no discrimination in the workplace; 
  • Provide a workplace safe and free from hazards;
   • Provide training to employees;
   • Provide competent supervision, etc.
  
  Application Activity 9.2
   A. Circle the correct answer for each statement.
   1. In Rwanda, an employer does not need to:
   a. Provide regular breaks for employees
   b. Maintain a safe workplace
   c. Pay employees the agreed-upon wage on time
   d. Pay for employee’s transportation to work
   
  2. In Rwanda, an employee has the responsibility to:
   a. Respect and follow the directions given by the employer
   b. Avoid hazards at the workplace
   c. Keep equipment in good working order
   d. Show up on time
   e. All of the above
   
  B. State whether the following statements are True or False
   1.Rights and responsibilities are the same for employers and 
  employees
   2. The Rwandan labor law protects workers against harassment, 
  intimidation and violence.
   3. Women should not report sexual harassment by their supervisors 
  because they will lose their job.
   4. Rwandan labor law protects adults, not youth.
   5. Think about a business, organization or any other institution in your 
  home locality employing workers. Answer the following questions:
   a. Discuss the responsibilities of the employer ( business/
   organization employing workers)
   b. What rights do employers expect their employees to provide?
  
   Skills lab 9
   1. For the business you intend to start in your community;
   i) How will you ensure that the rights of workers are observed?
   ii) What will be the responsibilities of different workers that you 
  will employ?
   iii) As the employer, what will be your responsibilities?
   iv) How will you ensure that workers have performed their 
  responsibilities?
   2. Draw 3 pictures showing human rights violation in your portfolio 
  notebooks.
  
   End of unit 9 Assessment
   KAZENEZA, an Adventist by religion was selected as the best candidate 
  to work as a teller at URWUNGUKO bank. Saturday is always a  very busy 
  day of the week most especially to cashiers due to the fact that, on this  
  day, the bank experiences huge amounts of deposits and withdrawals 
  in almost equal proportions hence many customers. In the employment 
  contract, the bank highlighted Saturday as a  special working day under 
  the  terms and conditions of working days.
   
  Questions:
   1. What advice would you give to KAZENEZA taking into consideration 
  his religious beliefs and the bank’s terms and conditions of the 
  employment contract?
   
  2. Assume that you are selected by RITCO Ltd; one of the biggest 
  and famous transport companies in Rwanda to train company 
  administrative and managing staff on the rights and responsibilities 
  of employer. 
  
  3. Discuss what will be contained in your training presentation as 
  the rights and responsibilities of employers to make sure that 
  employees’ rights and responsibilities are not violated by their 
  employers.
   
  
  BIBLIOGRAPHY
   A-Text books:
   Agriculture, U. o.-C. (1989). Money Management-How to Make Your Money Go Further. 
  University of Kentury.
   Akazi Kanoze Youth Livelihood project, (2009), Work Readiness Trainers’ Manual
   Ashe-Edmunds, S. (2018, October 15). Importance of Compliance in Business. 
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   Board, R. E. (2018). Taxes in business. In R. E. Board, Entrepreneurship S5 text book. 
  Kigali: Rwanda Education Board.
   Board, R. E. (2018). Entrepreneurship S.5. Kigali: Rwanda Education Board.
   Educate! Exchange, ( 2017),  Resources & Competency-based Entrepreneurship 
  Subject S4 Skills Lab Lesson Plans
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  18, 2019, from Businesscasestudies: https://businesscasestudies.co.uk
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   net
   Kalungi Rogers, Ngobi Dennis, Mutegaya Herbert, Okoroi David, Entrepreneurship for 
  Rwanda Secondary Schools, Learner’s Book  
  Stebbing, L. (1993). Quality Assurance: The Route to Efficiency and 
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  B- Online sources:
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