Mashonaland : Half Year Results

Independent Auditor's Report

On the Review of Inflation Adjusted Condensed Consolidated Interim Financial Information

To the Shareholders of Mashonaland Holdings Limited

Introduction

We have reviewed the accompanying inflation adjusted condensed consolidated interim financial information of Mashonaland Holdings Limited and its subsidiaries ("the Group"), which comprise the inflation adjusted condensed consolidated statement of financial position as at 30 June 2023 and the inflation adjusted condensed consolidated statement of profit or loss and other comprehensive income, inflation adjusted condensed consolidated statement of changes in equity and inflation adjusted condensed consolidated statement of cash flows, for the six month period then ended, and the selected explanatory notes to the inflation adjusted condensed consolidated interim financial information.

The Directors are responsible for the preparation and fair presentation of this inflation adjusted condensed consolidated interim financial information in accordance with International Accounting Standard (IAS) 34 - Interim Financial Reporting. Our responsibility is to express a conclusion on this inflation adjusted condensed consolidated interim financial information based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of inflation adjusted condensed consolidated interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Adverse Conclusion

Non-compliance with IAS 21 "The Effects of Changes in Foreign Exchange Rates" with respect to change in functional currency

IAS 21 - "The Effects of Changes in Foreign Exchange Rates" 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 (USD) from the beginning of the current six-month period ended 30 June 2023, management have elected to maintain the Zimbabwe Dollar (ZWD) 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 condensed consolidated interim financial statements as a whole.

Independent Auditor's Report

On the Review of Inflation Adjusted Condensed Consolidated Interim Financial Information

To the Shareholders of Mashonaland Holdings Limited

Adverse Conclusion

Due to the materiality and pervasiveness of the matter described in the Basis for Adverse Conclusion paragraph, we conclude that the accompanying inflation adjusted condensed consolidated interim financial information does not present fairly, in all material respects, the financial position of the Group as at 30 June 2023, and its financial performance and its cash flows for the six-month period then ended in accordance with International Accounting Standard (IAS) 34 - Interim Financial Reporting.

_____________________

Deloitte & Touche

Chartered Accountants (Zimbabwe)

Per: Stelios Michael

Partner

Registered Auditor

PAAB Practice Certificate Number: 0443

Date: 12 September 2023