KPMG Chartered Accountants has issued a highly critical assessment of Seed Co Limited’s financial statements, delivering an adverse audit opinion that underscores numerous significant weaknesses and failures to adhere to International Financial Reporting Standards (IFRS).
The audit firm’s latest report, released recently, raises serious concerns regarding the company’s financial reporting practices and its capacity to accurately represent its financial standing.
Consequently, the auditors have issued an adverse audit opinion on Seed Co Limited’s financial statements for the fiscal year ending March 31, 2024.
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One of the primary concerns highlighted in the audit report is the company’s determination of its functional currency as the Zimbabwean Dollar (ZWL).
According to the report, there was a fluctuation in the indicators used to assess the primary functional currency between the US Dollar (US$) and ZWL throughout the year, with a significant increase in the weighting towards US$ indicators towards the end of the year.
Moreover, the auditors noted non-compliance with IAS 21, The Effects of Changes in Foreign Exchange Rates, specifically regarding the company’s use of an internally generated exchange rate for recording foreign currency transactions and balances.
This approach is not in accordance with the accounting policies disclosed in the company’s financial statements.
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Seed Co Limited’s valuation of property, plant, and equipment was also flagged for non-compliance with IFRS 13, Fair Value Measurement. Similarly, the company’s accounting for investments in associates and joint ventures did not meet the requirements of IAS 28, Investments in Associates and Joint Ventures, due to inconsistent application of policies.
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