Connect with us

Support The NewsHawks


Auditors flag Masimba financials



MASIMBA Holdings’ external auditors have issued an adverse opinion on the company’s full-year financial results as the country’s currency volatility cycles continue presenting accounting headaches.


The Zimbabwe Stock Exchange-listed contracting firm’s headline earnings per share rose to US$3.05 during the period under review from US$2.23 in the prior year on improved revenue and cost cuts.

In a statement accompanying the financials, Grant Thornton, Masimba’s auditors, flagged the basis of using an internally generated exchange rate in coming up with the statements.

“In our opinion, because of the significance of the matters described in the Basis for Adverse Opinion section of our report, the consolidated financial statements do not present fairly, in all material respects, the financial position of Masimba Holdings Limited as at 31 December 2023, and its financial performance and cashflows for the year then ended in accordance with International Financial Reporting Standards (IFRS),” Grant Thornton says.

“The directors affected the change in functional currency on 1 January 2023, for which all items (except share capital and reserves) were translated to USD using internally generated exchange rate. Share capital and other reserves were translated from ZWL to USD using management’s valuation techniques. The resultant exchange differences from this process were recognised in a Foreign Currency Translation Reserve. This constituted a departure from the requirements of IAS21, which requires all items to be translated into a functional currency using the exchange rate at the date of the change.”

The company however says due to the limited amount of currency available to the Foreign Exchange Auction Market, directors do not believe that the official exchange rates prevailing during the year were at all times reflective of a spot exchange rate, being the exchange rate for immediate delivery as defined in International Accounting Standard (IAS) 21.

“The Board, having evaluated the mix of currencies wherein the Group was trading at 69% USD (2022: 65%), resolved to adopt the USD as its functional and reporting currency effective 1 January 2023. The financial results for the financial year ended 31 December 2023 have been reported in USD,” the company says.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *