The Institute of Chartered Accountants of Zimbabwe (Icaz) has disclosed the most-awaited set of guidelines for implementing financial reporting in hyperinflation reporting (IAS 29) in which companies are now expected to refer to implied annual inflation rate as well as the prevailing exchange rate when preparing financial statements.

BY FIDELITY MHLANGA

The year-on-year consumer price index (CPI) indices will be used to calculate the inflation adjusting factor, which is then applied to the historical figures to arrive at the inflation adjusted numbers.

Icaz has resolved to resort to this formula after Treasury suspended the publication of inflation figures, putting accountants in a quandary.

Companies had deferred publicising results waiting for the guidelines.

This comes after the Public Accountants and Auditors Board (PAAB) communicated that the characteristics of the Zimbabwe economy were ripe to apply IAS 29.

One such characteristic outlined through this standard is when the general population regards monetary amounts not in terms of the local currency, but in terms of a relatively stable foreign currency.

Also prices may be quoted in that currency — a scenario prevailing in the Zimbabwean economy.

Icaz said hyperinflation reporting required that non-monetary assets and liabilities, shareholders’ equity and comprehensive income be restated in terms of a measuring unit obtaining at the end of the reporting period, as such companies are, therefore, advised to device the CPI.

“The year-on-year CPI indices are used to calculate the inflation adjusting factor which is then applied to the historical figures to arrive at the inflation adjusted numbers. The Zimbabwe National Statistical Office (ZimStat) is the official source of all national statistics including inflation figures and the CPI indices for the application of restatement of figures. Preparers are advised to refer to the Reserve Bank of Zimbabwe (RBZ) website for the ZimStat CPI indices or directly request the same from ZimStat,” Icaz said in a statement.

While ZimStat has suspended the publishing of annual inflation figures, economists have been using month-on-month statistics to calculate year-on-year inflation rate.
As of October, annual inflation was put at 440%.

IAS 29 states that in a hyperinflationary economy, reporting of operating results and financial position in the local currency without restatement is not useful.

It also takes into account that money loses purchasing power at such a rate that comparison of amounts from transactions and other events that have occurred at different times, even within the same accounting period, will be misleading.

In accordance with IAS 29, the financial statements of an entity whose functional currency is the currency of a hyperinflationary economy, whether they are based on a historical cost approach or a current cost approach, shall be stated in terms of the measuring unit current at the end of the reporting period.

On monetary and non-monetary items, Icaz said preparers should restate all statements of financial position amounts that are not expressed in terms of the measuring unit current at the date of the statement of financial position.

“Monetary items do not need to be restated as they are already expressed in current purchasing power at the reporting date (IAS 29 par12). Non-monetary items should be restated with the exception of those measured at net realisable value or fair value,” Icaz said.

On comparatives, the prior year comparatives for both monetary and non-monetary items are supposed to be restated in terms of the measuring unit current at the end of the latest reporting period.

The opening balances will have to be restated by applying the appropriate adjusting factor(s) based on CPI index at the reporting date.

Pertaining to the gain or loss on net monetary position, Icaz said it can be calculated as the difference between the historical cost amounts and the result from the restatement of non-monetary items, shareholders’ equity, items in the statement of comprehensive income and the adjustment of index-linked items to year end purchasing power.

Icaz said the statement of cashflows shall be compiled from the restated figures and there are two specific features of the cashflow statement to be considered are: net income before tax is adjusted for the monetary gain or loss for the period; and the monetary gain or loss on cash and cash equivalents is presented separately.

Furthermore, companies must ensure that non-monetary items excluding shareholders’ equity are restated in terms of the measuring unit current at the end of the reporting period.

“An entity should use the increase in the general price index from the transaction date when they were first recognised to the end of the reporting period. (IAS 29 par 29). No restatement is required for non-monetary assets and liabilities carried at amounts current at the end of the reporting period, such as net realisable value or fair value,” the new regulations state.

For the purpose of presenting comparative amounts in a different presentation currency, IAS 21 — The Effects of Changes in Foreign Exchange Rates, apply and balances should be translated at the closing exchange rate in accordance with IAS 21:42(b) and IAS 21:43.

On group reporting, the financial statements of a parent company that also reports in the currencies of hyper-inflationary economies are restated by applying the CPI index of the country in whose currency it reports before they are included in the consolidated financial statements issued by the parent company. The restated financial statements of foreign subsidiaries are translated at closing rates.

The institute said some non-monetary items are carried at historical cost or historical cost less accumulated depreciation, so they are expressed at amounts current at the date of acquisition.

“The restated cost, or restated cost less restated accumulated depreciation, of each item is determined by applying the change in a general price index from the date of acquisition to the end of the reporting period to the item’s historical cost and accumulated depreciation,” it said.

“Property, plant and equipment (that is carried at historical cost less accumulated depreciation), inventories of raw materials and merchandise, goodwill, patents, trademarks and similar assets are therefore restated from the dates of their purchase. Partly finished and finished goods included in inventory are restated from the dates on which the costs of purchase and of conversion were incurred.”

THE sight of thick dark clouds building up over drought-prone areas of the country is enough to raise hopes for a better cropping season.

BY WILSON JOHWA

In late October when the first rains break, the long, dry months are quickly forgotten as the sparse, golden brown stubbles of grass turn to a resplendent green. However, the onset of the rainy season brings with it a frightening phenomenon that claims dozens of lives every year.

Zimbabwe is one of the world’s most lightning-prone countries: the holder of a world record in lightning-related fatalities. During the rainy season, lightning strikes normally kill up to 100 people, mostly rural children.

Many more people are maimed and countless livestock lost. Yet the Meteorological Services Department of Zimbabwe says it is possible that lightning deaths in the country might actually be under-reported by 20 to 30% and lightning injuries by more than 40%, as many deaths and injuries go unreported.

“The high number of lightning confirmation claims forwarded to the department for processing by property insurance companies, confirms that damage to equipment supplying electric power and telecommunications services, as well as to business and domestic premises is quite immense,” says meteorologist Desmond Manatsa.

Zimbabwe has the distinction of being one of lightning’s most favourite places. It is even cited in the Guinness Book of world records as the country where a single bolt of lightning claimed the largest number of victims. This occurred in a village near the eastern border town of Mutare in 1975 when 21 people were killed while sheltering in a hut.

The majority of lightning-related fatalities and injuries in the country are usually recorded in rural areas. This is because large buildings provide protection for those inside due to the metal frame of the building and specially designed lightning conductors. People on buses and in cars are also safe because of the metal frames around them.

Lightning has continued to be a worrying blight in the country. For instance, it struck and killed 10 people attending a church service in November 2002. Sixty-one others attending the service in the town of Chitungwiza, 35km south of Harare, were hospitalised with burns. The dead and injured were members of the Johane Masowe apostolic sect, the country’s largest religious group, which normally conducts meetings in the open.

On Tuesday this week, lightning struck four pupils of Rusike Primary School in Goromonzi, Mashonaland East, instantly killing three.

Police say most of the dead are children sheltering under trees. Study results released by the University of Zimbabwe in 1991 after research spanning seven years showed that lightning fatalities in the country average 90 to 120 per annum. Of all the districts, Gutu, which is quite populous, led with about 10 fatalities per annum. Binga, Marondera and Rusape follow with three to four deaths per annum.

Lightning figures recorded in Zimbabwe (150 873 sq miles-390 761 sq km) were higher than those recorded in the whole of the USA (3 537 441 sq miles 9 161 972 sq km) where, according to the Lightning Safety Tips Board of America, the phenomenon kills an average of 73 people per year. Since the surface area of Zimbabwe is many times smaller than that of the United States, these statistics stick out prominently on the global scale.

“Even when comparing us to our neighbouring South Africa, whose storms are just as fierce as ours, we still find that it has a record of a total of 400 fatalities in 10 years,” Manatsa says.

The high lightning toll in Zimbabwe can be explained by the prevalence of granite outcrops all over the country. The University of Zimbabwe established that granite is radioactive and discharges gamma rays up to the cloud, thus ionising the air molecules.

Abundant granite outcrops, together with soot from the numerous kitchen huts, offer the much-needed opposite charge on the ground, while tall objects offer the easiest route for electrical discharges to steer them way to the ground.

Manatsa says a point was also found in the Rhino and Lion Game Reserve in north-eastern South Africa where lightning struck repeatedly and had been doing so since the beginning of time. Here, unusually high concentrations of dolomite rock draw 15 lightning strikes a month. In 1996, lightning struck and killed a 5,5m tall giraffe while standing on a hill in the reserve. A year later, lightning electrocuted his mate.

— Islam Online

PRESIDENT Emmerson Mnangagwa and First lady Auxillia are expected to officiate at the two-day Bulawayo Cultural and Intellectual Property Conference at the National Gallery of Zimbabwe next week.

BY SHARON SIBINDI

The conference — which will be held on November 29 and 30 under the theme: Leveraging Arts, Culture and Heritage for Enhanced Productivity, Job Creation and Economic Growth —is meant to enable participants to explore themes of culture-led urban regeneration, intellectual property rights and expansion of market linkages.

The indaba is also a follow-up to a stakeholders’ consultation workshop held in Harare last month under the auspices of the Youth, Sport, Arts and Recreation ministry. One of the organisers, Sarah Mpofu-Sibanda, told a Press briefing yesterday that the conference theme was aligned with the 2020 national budget theme and their hope was that interacting with the President would have a positive impact on the industry.

Mpofu-Sibanda said the conference would engage the presidium for purposes of championing advocacy for meaningful and sustainable reform in the industry. “Aware that engagements have over the years been conducted ad infinitum, this conference seeks to cause the formulation of a time-bound action matrix that compels ministries, departments and (government) agencies to deliver on specific action points,” she said.

Albert Nyathi, one of the event co-ordinators, said the event afforded the creative industry a chance to air their views.

“This event is the first of its kind and is important in ensuring that the creative economy is viable and vibrant. Another one will be held in Harare for coming up with comprehensive solutions to the challenges faced by the creatives. The event will be held at the National Gallery in Harare to cater for the northern region,” he said.

BUSTOP TV co-founder Lucky Aaroni yesterday said the increase in the cost of data by mobile telecommunication companies has negatively impacted their work as the numbers of people visiting their sites were dwindling.

BY PRECIOUS CHIDA

Top comediennes Gonyeti and Maggie — whose hilarious skits have made them household names — are the face of Bustop TV.

Aaroni told NewsDay Life & Style yesterday that they had witnessed a decline in traffic especially on their Facebook and YouTube sites.

He said the cost of data had forced social media fanatics to be more discretionary when surfing.

“The issue of data has affected our online business in a great way. Most people viewed our videos from their mobile phones at any time, either going to work or travelling to any place but data is now too expensive for them to randomly see our videos on a regular basis,” he said.

“The time that most people spend on social media has reduced and only those that get WiFi from their workplaces can stream regularly but unfortunately they are only a few.”

Although he was not keen to disclose the exact figures, Aaroni, however, said they were still getting reasonable numbers on their platforms as most people panic on the first few days that data costs are increased but get used to the prices in due course.

He said the comedy platform, which has managed to monetise their sites, might not be able to do so if data costs continue to escalate.

“With the growth that we have experienced so far, we managed to monetise our social media platforms and generated income from them so if people who visit our sites continue to decrease because people now buy data for messages only, we won’t have anything to monetise, which will definitely cause a problem for us in the long run,” he said.

Aaroni said it would be wise for Zimbabwe to adopt policies used in other countries that allow citizens to pay less for browsing local content.

“It has to be cheaper than browsing international content so that they encourage people to watch and support local projects,” he said.

“If possible, it’s even better when we have something like Busstop TV bundle or music bundle to promote Zimbabwean artistes.”

Meanwhile, music promoter Benjamin Nyandoro said the situation had also affected musicians who have been marketing their music through social media platforms.

“The problem is affecting business across all sectors including musicians. Limited access reduces opportunities provided by the digital world,” he said.

“However, artistes need to continue embracing it as it remains the cheapest and most effective way (to share their work).”

THE government intends to spend US$88 million in scarce foreign currency on the Political Actors Dialogue (Polad) platform while the nation starves and the slow genocide in the nation’s hospitals is getting worse every day.

MDC communications

Polad is a talk-show of fringe politicians who agree with President Emmerson Mnangagwa and the broke government will spend some US$88 million in allowances, accommodation and workshops on them.

Meanwhile, the crisis in the country’s health institutions is worsening every day and the government has to date fired 211 doctors for demanding a living wage and better working conditions.

In the hospitals, there are virtually no medicines and other consumables, while only last week, the police violently quelled a peaceful protest march by the country’s civil servants who were demanding better wages and improved working conditions.

Morale among the country’s civil service has hit rock bottom.

The odious US$88 million budget for Polad vindicates the position that we took from the onset. We argued as a matter of principle that there was no wisdom in joining a politically compromised process, which was designed to co-opt the opposition. We refused to be puppets of a regime that is devoid of legitimacy.

We knew Polad was part of the regime’s strategy of co-opting dissenting voices.

The disgraceful US$88 million budget for Polad is the most visible sign of the Zanu PF regime’s plan to buy the opposition and of the compromised former opposition parties’ willingness to sell their voices for a few pieces of silver. These individuals masquerading as the opposition have no mandate from the people of Zimbabwe. Having failed to win the hearts of the people, they have shamelessly sold their souls to Zanu PF.

They are not the first to do so in the history of this country. Back in the late 1970s at the height of the liberation struggle, the Ian Smith regime managed to co-opt a few black leaders.

Those men who sold their souls were duly punished by history as the people emphatically rejected them at the first democratic elections in 1980.

THE owner of Bateluers Peak Farm, popularly known as Masapasi Ranch, has approached Chiredzi Magistrates’ Courts in a bid to evict over 150 families he alleges illegally settled on his property during the fast-track land reform programme.

BY GARIKAI MAFIRAKUREVA

Craig Henning, a South African national, is arguing that his ranch is protected under the Bilateral Investment Promotion and Protection Agreement (BIPPA).

According to Henning, who is being represented by Emmanuel Chibudu of Kwirira and Magwaliba Legal Practitioners, BIPPA is a legal instrument that establishes specific rights and obligations to meet the primary purpose of protecting foreign investments against discriminatory measures like policy inconsistencies by the host State.

He further stated that it ensures reciprocal encouragement, promotion and protection of investments, thus enabling conditions conducive to increase investment.

Zimbabwe has signed and ratified BIPPAs with Denmark, Germany, Switzerland, Netherlands, China, India, Russia, Kuwait, Iran, South Africa, Yugoslavia and the OPEC Fund.

Henning further argued that he previously enjoyed undisturbed occupation of the ranch before locals located near the conservancy started establishing temporary structures, which gradually turned permanent on his property.

In his founding affidavit, Henning named five respondents whom he said were self-imposed village chairpersons of the five new villages in the ranch: Gilbert Chibangwa, Elizabeth Magumbo, Peter Mashava, Tadious Muudzwa and another only identified as Mutsumbe – and Masapa Mbodza whom he alleges claims to have authority over all the five villages as the sixth respondent.

The rancher also cited Agriculture minister Perrance Shiri as the seventh respondent.

Environment minister Nqobizitha Mangaliso Ndlovu is the eighth respondent because he is responsible for the tourism sector and under whose ministry the ranch falls.

Henning’s founding affidavit reads: “The first to fifth respondents with their villagers have exercised massive deforestation clearing land and constructing huts using poles. They also hunt animals in the conservancy for food on a massive scale. Their settling in the conservancy has further caused some animals to run away from most parts of the conservancy where the squatters activities are rampant.”

The matter is set to be heard on December 4.

CHURCHES have been challenged to join the fight against gender-based violence (GBV) and weed out perpetrators of the vice among congregants.

BY PATRICIA SIBANDA

The calls were made at the launch of Speakout campaign against GBV organised by non-governmental organisation, Emthonjeni Women’s Forum (EWF) in conjunction with various church organisations in Bulawayo on Wednesday.

United Congregational Church of Southern Africa (UCCSA) leader Japhter Sibanda said GBV was rife in places of worship.

“There should be sensitisation of both communities and religious groups, especially the church as GBV is not in the world, but in the church also. GBV should be spoken about in church through Bible studies and sermons. Gone are the days when we used to speak in tongues among people who are survivors of GBV and remain irrelevant to them,” he said.

Sibanda applauded EWF for carrying out awareness campaigns and training church volunteers on GBV.
“A methodology by Sasa Faith was adopted by EWF to reach out to communities where about 60 participants were invited for training to be ambassadors of change. The community activists are trained and sent out to spread awareness against GBV,” he said.

EWF director Skhathele Mathambo said the campaign focuses on educating church goers about violence.

“It’s national because it’s here in Bulawayo, Harare and also has a group that is being trained in Mutare. In Bulawayo, we have 60 community activists from different churches and the good thing about this group is it does not only focus on conventional churches, but we also take into consideration apostolic faith churches,” she said.

Mathambo said some of the community activists were rehabilitated convicts.

Union for the Development of Apostolic and Zionist in Africa co-ordinator Anna Nemapfuti-Ngwenya said: “We no longer want to be the victims; we are here today because we want change. This time we are not going to be quiet, but we will speak out and let the world know. Many people have known us as people who do not engage in activities such as these, but today we are here and we want to be better and be educated people who know more about GBV.”

MIDLANDS Provincial Affairs minister Larry Mavima has warned that machete wars between artisanal miners may degenerate into a national conflict if not nipped in the bud.

BY BRENNA MATENDERE/ SIMBARASHE SITHOLE

Officially opening the Chiefs Council meeting hosted by the Zimbabwe Council of Churches (ZCC) in Gweru on Tuesday, Mavima implored traditional leaders to instil the culture of peace in artisanal miners.

“We often hear that the artisanal miners are now a menace in communities. They are using machetes to injure people. Everyday there now seems to be such cases. We will all perish if these cases of violence persist. We need peace in the country. If these small cases of violence are allowed to go on, they will become a national conflict,” he said.

Recently, the Zimbabwe Peace Project released a report indicating that between August and October this year, 105 people died in machete wars, while hundreds others were injured by Zanu PF-linked terror groups. The report said the gangsters terrorised the country’s gold-rich regions, committing heinous crimes on the back of immunity because of their government and ruling party links. In some instances, the perpetrators have been used by senior politicians to victimise opposition party supporters.

Machete war cases have been reported mainly in Midlands, but lately they have spread to other areas such as Mazowe and Kadoma.

“At the end of the day we are all Zimbabweans. We are one nation. We must find solutions to our differences without killing each other. We might have different political persuasions, but we have one country. Peace is the bedrock of any successful nation,” he said.

Chief Ngungumbani, the head of Midlands Chiefs said the traditional leaders should inculcate the spirit of ubuntu, among their subjects in order to curb the scourge.

“In some countries in the Middle East they have deepened culture. Some of the countries use Sharia law, but that is their culture. Let us develop our own culture of ubuntu to avoid such menaces as machete wars,” he said.

Police officer commanding Midlands operations, Assistant Commissioner Peter Sibanda said: “Anyone who commits a crime must be arrested. We have been doing that, but if there are complaints let them be brought forward and we will act.”

Police in Mashonaland Central province revealed that they arrested 53 artisanal gold miners at Jumbo Mine in Mazowe and Kitsiyatota in Bindura for illegal mining activities last week.

The arrests are being carried out under an ongoing blitz to net those engaged in unlawful mining operations throughout Mashonaland Central province. Twenty-seven vehicles have also been impounded in the operation.

Provincial police spokesperson Inspector Milton Mundembe confirmed the arrests.

“I can confirm the arrests of 53 illegal miners and the impounding of 27 cars at Mazowe Mine and Kitsiyatota in Bindura,” Mundembe said.

At Delta Gold’s Eureka Mine in Guruve, one of the artisanal gold miners was shot on the leg last week when he tried to attack security guards in a gold scuffle.

Chriswell Mushongahande (27) of Muroiwa village under Chief Chipuriro in Guruve is battling for life at Guruve District Hospital after he was reportedly shot by a security guard Paradzai Nyamutsenga (51).

Police officer commanding Guruve district, Robert Torevasei confirmed the incident, saying they are assisting in protecting the mine.

“One of the artisanal miner was shot by the guards after he tried to attack them using an iron bar, last week. The police had to use tear smoke to disperse them as they ran amok at the mine,” Torevasei said.

He reiterated that the illegal miners were slowly giving up on the mine after police intervention although the force was slowly moving away to focus on their core business.

“Illegal miners are now coming in small numbers since our intervention and most of the crashing machines were removed, but we are also slowly withdrawing our services because it not our core business.”

The mine is currently under care and maintenance hence a lot of local illegal miners are flocking to the place to prospect for gold.

AGRO-SEED firm, Syngenta, is rolling out a nation-wide training programme aimed at equipping Agritex workers with expertise on modern smart agriculture practices to improve production and yields.

By Everson Mushava

The company, as part of its corporate social responsibility programme, is providing free training to Agritex officers on emerging trends on chemical handling and application as well as new, drought-tolerant seed varieties.

One of the country’s major producers and suppliers of crop seed, insecticides and herbicides, Syngenta recently launched a new insecticide used in seed treatment and is especially potent in fighting fall armyworm, which had been wreaking havoc on the farms for the past three years.
The tissue-eating pest is very difficult to control as it is highly resistant to other chemicals and, so far, the only most effective way of controlling it has been biological.

In an interview on the sidelines of one such workshop in Bindura on Tuesday, Syngenta training officer Moses Kudanga said the programme was meant to equip farmers with requisite knowledge on chemicals use and seed varieties.

“The trainings that Syngenta organises with Agritex are for the purposes of equipping farmers with knowledge on the use of chemicals and seed varieties,” Kudanga said.

He said each extension worker would have to deal with between 200 and 300 farmers, who will then pass the information to other farmers.

Joe Mukanda, an agriculture training consultant working with Syngenta said the significance of the training workshop was that they would bring technology to the farmers through empowering Agritex officers who deal with farmers on a daily basis.

“We are trying to train farmers through extension workers so that we equip them with knowledge, because we have had problems where farmers buy products from suppliers they don’t know and they will come back to say they are not working,” Mukanda said.

Mashonaland Central provincial agronomist Jaidi Izah said: “As Agritex, our officers have been lacking. This in-house training which we always encourage and with the movement of technology, our farmers need to be equipped with advanced knowledge. So when we see our farmers receiving this sort of training, we know it is going to help them to have some agronomic knowledge.”