By Alois Vinga
THE Zimbabwe Stock Exchange (ZSE) has pardoned all listed companies which did not comply with the requirements of International Accounting Standard (IAS) during presentation of its latest financial results.
ZSE appreciated the failure was triggered by government’s policies and was beyond their control.
The equities market chief executive, Justin Bgoni announced recently that under normal circumstances, such failures were bound to be treated as adverse opinions which deserved to be presented for deliberation before a special tribunal but after considerations, listed companies will be pardoned because most published financial results did not comply.
“Stakeholders are advised that, in terms of clause 3.26 in Section 3 in the ZSE’s Listings Requirements, such opinions mandate the Listings Committee to convene a special meeting to consider the effects of such opinions and the continued listing of the affected issuer,”Bgoni said.
He assured listed companies that the ZSE will notify the Securities and Exchange Commission of Zimbabwe (SECZ) of this development in terms of Rule 49 (2) of Statutory Instrument 100 of 2010.
Bgoni said that the ZSE climbed down on the requirements after noting that all companies had similar challenges hence the need to waive the requirement for the special Listings Committee meeting regarding the audit opinions issued on basis of non-compliance with IAS 21.
SECZ will be furnished with the requisite supporting documentation with regards to all modified opinions.
“The ZSE’s resolution was also informed by the understanding that it was not the Listed Companies’ volition not to comply with the financial reporting standards but rather a matter of complying with the obtaining laws of the country as prescribed by Statutory Instrument 33 of 2019.
“Going forward, issuers are expected to fully comply with International Accounting Standards as guided by the listing requirements unless the country’s statutes direct otherwise,” Bgoni said.
The ZSE also committed to continue engaging the Public Accountants and Auditors Board on any new developments regarding financial reporting by issuers.
Since 2009 several policy measure have affected the financial reporting standards in Zimbabwe. For instance, the inception of the United States dollar meant that all listed firms had to embrace the currency as their book keeping currency.
Apart from this development, more challenges have also been presented as a result of continuous policy shifts such as the introduction of export incentives in the form of bond notes in 2016 becoming a surrogate currency; the separation of RTGS bank accounts and US dollar Nostro accounts in 2018.
In February this year, the announcement of the Monetary Policy Statement which saw the floating foreign currency trading through the introduction of an inter-bank foreign exchange market also had a bearing on meeting reporting standards.