• Mon. Jul 22nd, 2024

Starafrica FY24 results get qualified audit opinion

ByETimes

Jul 9, 2024

By ETimes

HARARE – Starafrica Corporation’s external auditor has issued a qualified opinion on the group’s financial statements for the year ended 31 March 2024, in relation to non-compliance with International Accounting Standards.

A qualified opinion means the auditor found significant errors, but they don’t affect the overall reliability of the financial statements.

The primary concern revolves around issues related to changes in foreign exchange rates, International Financial Reporting Standards (IFRS) from prior years and accounting policies and errors.

Starafrica incorrectly used interbank exchange rates to translate foreign currency transactions and balances into ZWL and used USD valuation inputs to value property and equipment, which did not comply with IFRS 13 fair value measurement requirements.

The auditor’s report for the previous year’s financial statements was modified to highlight errors, which have still not been corrected in the latest financial statements.

“As the non-compliance with IAS 21 and IFRS 13 is from prior financial years and there have been no restatements to the prior year financial statements in accordance with IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, the retained earnings and revaluation reserve in the inflation-adjusted group and company financial statements may contain misstatements,” said Grant Thorton.

“Our opinion on the current year inflation-adjusted group and company financial statements is modified because of the residual effects of non-compliance with IAS 21 and IFRS 13 on the retained earnings and revaluation reserve, respectively, in the group and company financial statements.”

According to the auditor, the non-compliance with IAS 21 and IFRS 13 had a significant impact (material) on the financial statements, but it did not affect the overall picture (not pervasive).

The company’s financial statements include a share of profit from an investment in an associate company (Tongaat Hulett Botswana), but those financial statements have not been audited.

“As a result, we were unable to satisfy ourselves that all necessary adjustments and disclosures have been made to the financial statements of Tongaat Hulett (Botswana) (Proprietary) Limited for the year ended 31 March 2024.

“Accordingly, we were unable to determine the effect this might have on the share of profit, foreign currency translation exchange differences and investment in associate in the inflation-adjusted group and company financial statements of Starafrica Corporation Limited for the year ended 31 March 2024,” Grant Thorton said.

As of the latest trading session, Starafrica shares appreciated by 4.76% to finish at ZiG0.8172c, resulting in a market capitalization of ZiG38.53 million.

By ETimes

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