Dear Editor,
The latest column by GHK Lall (KN August 19, 2024) raises serious concerns about his credibility. GHK Lall has previously claimed that he worked on Wall Street as an analyst and held the prestigious “Chartered Financial Analyst” (CFA) designation. However, it should be noted that he no longer maintains this designation, as he has not kept up with the necessary annual subscription payments.
For those unfamiliar with the finance profession, the CFA qualification is considered the gold standard in the finance world. To my knowledge, there is currently only one active CFA holder in Guyana. She is the daughter of a former President.
It is difficult to reconcile GHK Lall’s previous claims with the content of his recent writings on financial matters. Anyone who holds, or has held, the CFA designation would be expected to exhibit a high level of expertise and would not produce the kind of commentary that we have seen from GHK on these issues.
Any genuine CFA holder or finance professional would carefully examine the financial statements of oil companies and would be able to identify, with precision, the implicit interest rate, which in this case works out to 5.18%. This rate is related specifically to lease financing, a form of debt financing for the FPSOs. The financial statements include an amortization schedule that was used to derive this implicit interest rate.
Regarding the return on equity (ROE), GHK Lall has referred to an ROE of 96%, a figure reportedly provided by chartered accountant, Lalbachan Ram. However, this figure is inaccurate. According to ExxonMobil Guyana’s 2023 financial statements, the actual ROE is 55.5%. I will address this matter in greater detail in due course.
For now, it is important to highlight that Mr. GHK Lall, who claims to have held the CFA designation, is presenting information that does not align with the level of analysis expected from someone with such qualifications. It is particularly concerning that he appears to have relied on a chartered accountant for his analysis rather than conducting it himself. If he truly held the CFA designation, he would be regarded as an authority on financial matters, surpassing the expertise of the chartered accountant on whom he relied.
To put this in perspective for the general public: the difference between a CFA and a chartered accountant is akin to the difference between a “Bugatti” and a “Toyota Carina (192).”
Sincerely,
Joel Bhagwandin
