"ZESA Is Unable To Pay Debts," Audit Report

Auditor General Mrs Mildred Chiri, reveals in her recent audit report that the Zimbabwe Electricity Supply Authority (Zesa) is unable to pay its debts. The report suggests that the authority’s indebtedness surpass its assets by over US$92 million.

The report that was tabled in Parliament last week by Justice Minister, Ziyambi Ziyambi, said:

I draw your attention to the fact that the company’s current liabilities exceed its current assets by US$92 118 178, this indicates that a material uncertainty exists that may cast significant doubt on the company’s ability to continue operating as a going concern.

In 2017 the company’s liabilities exceeded its assets by US$84 167 798. The AG also said the company’s finances were in shambles. Chiri said:

Because of the significance of the matter described in the basis for the adverse opinion section of our report, the financial statements do not present fairly, in all material respects, the financial position of Zesa Holdigs Private Limited as at 31 December 2018, and its financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards.

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Zesa has attributed the challenges it faces to the sub-economic tariffs it charges resulting in production costs of electricity to remain higher than the sale costs.

The government announced recently that it had paid US$10 million to South African power utility, Eskom, and paid off $20 million to Zesa Holdings to clear its debt. Eskom has since denied receiving that money.

More: The Chronicle