Mashonaland : FY23 Results & Audit Opinion

INDEPENDENT AUDITOR'S REPORT

ON THE CONDENSED INFLATION ADJUSTED FINANCIAL STATEMENTS

TO THE SHAREHOLDERS OF MASHONALAND HOLDINGS LIMITED

Denial of opinion

The condensed inflation adjusted consolidated financial statements of Mashonaland Holdings Limited and its subsidiaries ("the Group" / "Mashonaland Holdings Limited"), set out on pages 5 to 14, which comprise the condensed inflation adjusted consolidated statement of financial position as at 31 December 2023, and the condensed inflation adjusted consolidated statement of profit or loss and other comprehensive income, the condensed inflation adjusted consolidated statement of changes in equity, and the condensed inflation adjusted consolidated statement of cash flows for the year then ended, and related notes, are derived from the audited inflation adjusted consolidated financial statements of Mashonaland Holdings Limited for the year ended 31 December 2023.

As a result of the adverse audit opinion on the audited inflation adjusted consolidated financial statements discussed in The audited inflation adjusted consolidated financial statements and our report thereon section of our report, it is inappropriate to express an opinion on the accompanying condensed inflation adjusted consolidated financial statements.

Summary inflation adjusted consolidated financial statements

The condensed inflation adjusted consolidated financial statements do not contain all the disclosures required by the International Financial Reporting Standards and the requirements of the Companies and Other Business Entities Act

(Chapter 24:31) as applicable to annual financial statements. Reading the condensed inflation adjusted consolidated financial statements and the auditor's report thereon, therefore, is not a substitute for reading the audited inflation adjusted consolidated financial statements of the Group and the auditor's report thereon.

The audited inflation adjusted consolidated financial statements and our report thereon

In our report dated 26 March 2024, we expressed an adverse audit opinion on the audited inflation adjusted consolidated financial statements of Mashonaland Holdings Limited for the year ended 31 December 2023. The basis for our adverse audit opinion was that the Group has assessed that it has met the indicators stipulated in IAS 21 for reporting in United States Dollars (USD), but has maintained the Zimbabwe Dollar (ZWD) as the functional and reporting currency for the purposes of the inflation adjusted consolidated financial statements while assessing the impact of the long term national monetary policy environment.

IAS 21 requires that the functional currency of an entity reflect the underlying transactions, events and conditions that are relevant to the entity, and to change the functional currency when there is a change in those underlying transactions, events and conditions. Whilst the Group's indicators have provided evidence of a change in functional currency for the entity to United States Dollars from the beginning of the current financial year ended 31 December 2023, management have elected to maintain the Zimbabwe Dollar as the entity's functional currency.

This does not comply with the requirements of IAS 21, which requires that when there is a change in an entity's functional currency, the entity shall apply the translation procedures applicable to the new functional currency prospectively from the date of the change.

We were unable to quantify the effect of the departure from IAS 21, but the effect is considered to be material and pervasive to the inflation adjusted consolidated financial statements as a whole.

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INDEPENDENT AUDITOR'S REPORT

ON THE CONDENSED INFLATION ADJUSTED FINANCIAL STATEMENTS

TO THE SHAREHOLDERS OF MASHONALAND HOLDINGS LIMITED (continued)

Directors' responsibility for the condensed inflation adjusted consolidated financial statements

The directors are responsible for the preparation of the condensed inflation adjusted consolidated financial statements in accordance with the requirements of the ZSE and the requirements of the Companies and Other Business Entities Act (Chapter 24:31) as applicable to condensed financial statements.

The listings requirements require condensed reports to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS).

Auditor's responsibility

Our responsibility is to express an opinion on whether the condensed inflation adjusted consolidated financial statements are consistent, in all material respects, with the inflation adjusted consolidated audited financial statements based on our procedures, which were conducted in accordance with International Standard on Auditing (ISA) 810 (Revised),

Engagements to Report on Summary Financial Statements.

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DELOITTE & TOUCHE

CHARTERED ACCOUNTANTS (ZIMBABWE)

Per: Stelios Michael

(PAAB Practice Certificate 0443)

Partner

Registered Auditor

Harare, Zimbabwe

Date: 26 March 2024

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