Grant Thornton, the esteemed watchdog overseeing Masimba Holdings Limited’s financial integrity, has unleashed a whirlwind of controversy with its latest audit report. In a blistering critique, the report lambasts Masimba’s 2023 financial statements, citing “material non-compliance” with the sacred scrolls of International Financial Reporting Standards (IFRS).
Engagement Partner Edmore Chimhowa, the herald of this damning decree, paints a vivid picture of financial discord within Masimba’s corridors. The report’s narrative lays bare significant discrepancies, particularly in the realm of foreign currency sorcery, leaving the once-sturdy edifice of Masimba’s financial reputation teetering on the brink of collapse.
“In our opinion,” declares Chimhowa with the gravity of a seasoned sage, “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 cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS).”
The crux of the matter revolves around Masimba’s audacious pivot from Zimbabwean Dollars (ZW) to the formidable fortress of United States Dollars (USD), effective January 1, 2023. Yet, in this audacious maneuver, the auditors discern a fatal flaw – a departure from the hallowed guidelines of IFRS.
“The directors effected the change in functional currency,” the report laments, “for which all items (except shore capital and reserves) were translated to USD using an internally generated exchange rate.” Such audacious disregard for convention, it seems, has left Masimba’s financial fortifications vulnerable to siege.
Grant Thornton’s scrutiny extends beyond the realm of currency shapeshifting, delving into the murky waters of revenue recognition practices, particularly in the labyrinthine realm of construction projects. Here, the auditors unearth a “presumed fraud risk,” a specter haunting the company’s ledgers like an unseen wraith.
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“The amount of revenue and profit recognized in a year on construction projects,” the report intones solemnly, “is dependent on, among other things: On the actual costs incurred; The assessment of the percentage of completion for contracts; and The forecast contract revenue and costs to complete for each project.” Yet, lurking within these shadowy realms of estimation and judgment, lies the potential for financial chicanery of the highest order.
While no smoking gun emerges from Grant Thornton’s exhaustive investigation, the specter of risk looms large, casting a pall over Masimba’s once illustrious financial landscape.
As the dust settles and the echoes of the auditors’ rebuke fade into the ether, Masimba finds itself at a crossroads – a juncture where integrity must triumph over expedience if the company is to reclaim its rightful place among the titans of industry.
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