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By Ross Moyo
The Public Accountants and Auditor’s Board (PAAB) and Securities Exchange Commission of Zimbabwe (SECZIM) have Complied with the country’s Monetary Policy Statement (MPS) and international Standards.The PAAB, a statutory body overseeing the accountancy profession in Zimbabwe, also underscored the importance of aligning financial reporting with international standards while complying with national monetary policies.
All entities, irrespective of their functional currency, must present financial statements in ZiG for periods ending on or after December 31, 2024 according to the board’s latest paper.
By Ross Moyo
“Entities must follow guidance from IAS 21 paragraphs 38-43, ensuring that financial statements are translated using the Reserve Bank of Zimbabwe’s official exchange rates. This will enhance comparability and promote consistency in financial reporting,” the PAAB states.
Leveraging the framework provided by the International Financial Reporting Standards (IFRS), the PAAB ensures that the translated reports maintain accuracy and credibility.
Their commitment to best practices reinforces the nation’s economic stability, while paving the way for broader acceptance of ZiG in corporate and investment circles. The MPS is pushing the national agenda of de-dollarisation by 2030, as a gradual shift to a mono-currency is being pursued by the central bank. This move is seen as a starting point.
Dr John Mushayavanhu, the Reserve Bank of Zimbabwe told the Parliamentary Portfolio Committee on Budget and Finance that the MPS enhances the stability of ZiG and the economy.
Stating: “We are doing everything in accordance with stabilising the ZiG currency. Looking at the de-dollarisation road map, the main important thing is that the 2030 deadline to dissolve multi-currency is what we are working with, whereby we will have zero transactions in foreign currency.”
The functional currency is the currency of the primary economic environment in which an entity operates according to International Accounting Standard 21 (IAS 21) terms.
This is the currency in which the business earns revenue and incurs expenses. For many Zimbabwean companies, the functional currency remains the US dollar due to its widespread use in transactions.
The reporting or presentation currency is the unit in which an entity presents its financial statements and Following the 2024 MPS, all Zimbabwean entities must use ZiG as their reporting currency, regardless of their functional unit.
SECZIM notified issuers that “pursuant to Paragraph 21 of the First Schedule of the Securities and Exchange Act (Chapter 24:25) and paragraph 194 of the Monetary Policy Statement presented by the RBZ Governor on 6 February 2025, that every licensed person must adopt a common presentation currency, ZWG, for reporting purposes, with immediate effect, including for the 2024 audited financial statements”.
“Any licensed person facing challenges complying with this directive may approach the Commission for further guidance,” reads the SECZIM statement in part.
This means Zimbabwe gold ZiG becomes mandatory reporting currency, a move aimed at enhancing financial transparency and standardisation, with the Public Accountants and Auditors Board (PAAB) and the Securities and Exchange Commission of Zimbabwe (SECZIM) embracing the recent Monetary Policy Statement (MPS) directive mandating the use of Zimbabwe Gold (ZiG) as the presentation currency for financial reporting.
The policy shift, as outlined in the PAAB’s latest technical paper, marks a significant milestone on Zimbabwe’s financial landscape, reinforcing investor confidence and ensuring a uniform approach to corporate reporting.
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