Hesab.af - A New Localized Accounting Software for Afghanistan

Launched by Afghanistan Holding Group, Hesab.af is an affordable, secure and simple taxation accounting web application for smartphones, tablets and computers.

For over 6 years, Afghanistan Holding Group (AHG) has provided taxation accounting services to the highest end of the market: large international contractors in Afghanistan. Given the extremely laborious nature of taxation accounting and high cost of qualified accountant labor in Afghanistan, AHG had not yet offered a product affordable enough for the mass market of Afghan businesses and shops. 

AHG has now developed an extremely secure, simple and easy-to-use taxation accounting web application for smartphones, tablets and computers called Hesab.af (which means accounting in Pashtu and Dari). The application is input income and expenses transactions to build standard Profit & Loss and Balance Sheet statements, and then automatically generates the required monthly, quarterly and annual tax forms as PDFs. Until Hesab.af is connected directly to the Ministry of Finance (MOF)’s systems, the PDFs are printed out and filed at the MOF by AFS in hard copy. Similarly, until Hesab.af  is connected directly to Da Afghanistan Bank (DAB)’s systems, AHG receives tax payments via mobile money, bank transfer and credit/debit cards, for onward remittance to DAB and then provides the paid tax receipt back to the client. 

The interface can toggle between: 1) Pashtu, Dari and English languages, 2) U.S. Dollar and Afghani currencies, and 3) Gregorian and Afghan calendars. For those familiar with Western products, Hesab.af can be compared to an extremely simple cross between Intuit QuickBooks Online and TurboTax Online, capable of preparing 3 basic financial statements for proper financial management as well as all 6 types of Afghan taxes for eFiling and ePayment. 

The Afghanistan Income Tax Law of 2009 requires every legal entity (businesses, non-profits, associations; local and foreign) to withhold from payments to landlords, employees and contractors every month, pay business receipts tax (if applicable) every quarter, and file a detailed income statement and balance sheet every year. As of June 2013, there were 36,072 Afghan and 2,294 foreign businesses registered in Afghanistan, although a large portion are understood to be not active. The law also requires every Afghan citizen and every non-Afghan resident (over 183 days per year in Afghanistan) to file and pay taxes. Furthermore, every taxpayer is to obtain a Tax Identification Number and maintain proper accounting records. Currently, only the largest organizations in Afghanistan withhold, file and pay taxes. Obstacles include poor understanding of the law, high corruption, limited tax payment channels, as well as extreme challenges with obtaining, completing, submitting and clearing the required tax forms. 

Assuming the Afghan population is 32 million and the average household size is 8, the total market for Hesab.af can be estimated at 4 million. There are about 17 million cells phones in use, but Hesab.af is only targeting active smartphone users with internet access enabled, which is a much smaller subset. Also, given high levels of illiteracy, inaccessibility and attitudes preferring for non-compliance, Hesab.af is targeting only 11,880 clients, or 0.297% of the total market during its first year. 

Proper accounting records are nearly non-existent in Afghanistan – causing a deluge of problems with internal cash flow management, business partnerships, governance, financing applications and tax filing.  There is no localized accounting software product in Afghanistan, and Hesab.af will fill that massive void with a simple, easy to use but state-of-the-art solution. On a national scale, Hesab.af can not only revolutionize the accounting industry in Afghanistan, but also serve as a platform for launching services such as vetting, investments, payments and much more. Hesab.af is a vital tool to be used not only by the 11,880 small businesses, but also AHG own clients and potentially every household in the country.  

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