British American Tobacco Zimbabwe Holdings Limited (BAT Zimbabwe) has received a qualified review opinion from its auditors, KPMG Chartered Accountants Zimbabwe, for its condensed consolidated financial results for the half year ended 30 June 2025.
The qualification is primarily due to non-compliance with International Accounting Standard (IAS) 21, The Effects of Changes in Foreign Exchange Rates, and IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, related to the accounting treatment of legacy blocked foreign currency funds.
The auditors highlighted that BAT Zimbabwe has continued to account for foreign liabilities amounting to USD 16.3 million, approved as blocked funds, at an exchange rate that does not reflect the current functional currency translation requirements under IAS 21.
Related Stories
The company recorded both the US dollar denominated liability and the Zimbabwean dollar asset at the same value, which led to an understatement of trade and other payables by USD 16.3 million and an overstatement of opening retained earnings by the same amount.
This approach deviates from IFRS standards and has been a persistent issue since prior periods, leading to the qualified opinion.KPMG noted that the Group has not restated the financial results as required by IAS 8 to address the prior-year qualification, causing the matter to remain unresolved in the current period.
BAT Chairman Lovemore Manatsa acknowledged the challenging operating environment characterised by macroeconomic complexities, including inflation and currency changes, but expressed confidence in BAT Zimbabwe’s resilience and commitment to long-term value creation.
He highlighted the company’s strategic focus amid volatile market conditions and extended gratitude to stakeholders for their support during the period.
"Despite operating in a complex and evolving macroeconomic , BAT Zimbabwe remained resilient and focused on delivering sustained value to its stakeholders... The Board remains confident in BAT Zimbabwe’s ability to navigate the ever-changing macroeconomic landscape and deliver long-term value to all stakeholders," the Chairman noted.
Leave Comments