Back to Basics

Titles are a popular thing in Honduran culture; Profe, Doctor(a), Ingeniero(a), Pastor, etc. Now it might be that they really respect one’s position or that remembering their title is easier than remembering their name. I think in the States is seen as arrogant or superficial to introduce yourself with your title when you first meet someone, and even then you would only call the teacher ‘Teacher’ when it was your teacher. In Honduras, having a University degree bestows you with the title Licensiado(a). It’s not very popular to call someone Licensiado, but technically this would be my title here, so I probably should be introducing myself as such. Fortunately for me, my host dad is quick to introduce me as Licensiado en Finanza. This keeps people from thinking I’m just a vagabond or hippie, however it presents another problem. Maybe it’s just me, but I don’t feel like a 4-year degree made me an expert in any given financial topic. In fact, accounting was a large part of my degree and I’ve always tried to avoid it. Key word: tried.

I might just be the only one technically “qualified” to work in finance in Subirana, so it’s back to the basics for me. My current project is automating the coffee cooperative’s accounting system. Automating is easy when it’s already correct. But what fun would that be? I’m finding even the basic accounting I can recall is coming back to me, though slightly jumbled. Now the Latin culture may bend the definition of punctuality and the importance of time, but in finance it makes a huge difference. Let’s talk for a minute about timing of payments.

If you make a payment on your car loan, it’s pretty important that the financing company document that date on time, and not say, 6 months after the fact. Why? Because you don’t want to be paying interest on that old, larger amount, you’d rather be paying interest on the new smaller amount (or no interest at all!). Well, the math does seem to get a bit more complicated as you start to talk about timing issues. Currently, our one and only formula is as follows:

Principal * Interest * Time (days)

                   360

The way the accounting is set up now is very basic, and easy. It’s easy to automate something like this, but with Excel we want to know more information in order to make formulas that work for every contingency. It’s got me second-guessing myself about accounting, but we’ve got plenty of time to figure it out. And in the meanwhile, I’ve got to pretend like I learned something with my finance degree. Next post, I’ll get a little more technical about how accounting works in Honduras. I'm gonna go brush up on the accounting I tried not to learn all those years.

Licensiado Adán signing off. You stay classy, U.S.A.