Zimbabwe Gears Up for Hyperinflation Reporting Standards

Source: Internet

Staff Reporter

Zimbabwe is on the verge of adopting a hyperinflation financial reporting model following the inflation figures that have spiked as its insubstantial economy is on the brink of collapsing. The Public Accountants and Auditors Board (PAAB) is set to be announce the reporting modality.

The development comes after Treasury announced in August that it would suspend publication of annualised inflation figures which stood at 176% at the end of June. Once pronounced, local listed companies will then adopt a hyperinflation standard, IAS 29 of International Financial Reporting Standards (IFRS) which provides guidelines for entities whose functional currency is the currency of a hyper inflationary economy.

The IFRS defines hyperinflation as prices, interest and wages linked to a price index rising 100% or more cumulatively over three years. Companies operating under this regime may be required to update their statements periodically in order to make them relevant to current economic and financial conditions, supplementing cost-based financial statements with regular price-level adjusted statements.

Institute of Chartered Accountants of Zimbabwe (ICAZ) also confirmed the development that board is working to adopt the hyperinflation reporting standard here in Zimbabwe.

ICAZ Chief Executive Officer Mrs Gloria Zvaravanhu revealed that, “yes, assessments are underway at the Public Accountants and Auditors Board (PAAB). As ICAZ, we submitted our input. I want to believe they will communicate very soon,”

PAAB secretary Admire Ndurunduru said an announcement on the adoption of the reporting standard was imminent as some local companies are warming up to the idea, with Simbisa Brands Limited announcing it in their full year results ended June 2019 that going forward, it foresees difficulties in complying with the accounting standard in the absence of year-on-year inflation data.

Where a subsidiary reports in the currency of a different hyper inflationary currency, then its financial statements should first be restated by applying a general price index of the country in which it reports. The restated financial statements should then be translated at closing rates.

During the first half of 2019, South Africa-based Old Mutual Limited concluded that its Zimbabwean subsidiary was operating in a hyper inflationary economy and immediately decided to account for it as such.

“This decision was supported by a rapid increase in the inflation rate, which at the end of June 2019 was far in excess of 100% at 176%, the significant deterioration in the traded interbank RTGS dollar exchange rate over the period and the lack of access in Zimbabwe to foreign currency to pay foreign-denominated liabilities.

We have applied hyperinflation accounting from October 1, 2018 and used the Zimbabwe consumer price index (CPI) to inflation adjust reported numbers. The results, net assets and cash flows are then translated into rand at the closing rate of ZW$1 to ZAR2,13. The closing rate used to translate the December 2018 results was ZW$1 to ZAR4, 35,” said Old Mutual.

Nyari Mashayamombe

View all posts

Add comment

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

download xxx video in lola loud rule 34 nudevids.org sexo mujer con caballos black and asia porn, porn videos in h d lesbian movies on netflix fucknude.net high scool dxd porn my first girlfriend is a gal uncencered, dad son gay porn jenna jameson the masseuse fuckhd.org the best of porn stars sister in law fucked
kasey kei jewelz blu oral cream pie compulation xxxpor.win lesbians w big tits mom and daugher lesbian porn, big nude beach tits tana mangeau only fans wifeporn.win niykee heaton sex tape gay prison porn rape, lesbianas hasiendo el amor escort in fort myers xxnx.vip make love not porn jenna lynn meowri onlyfans