Audit firm raises red flag over Ariston balance sheet

HARARE, – Accountancy and professional services firm Deloitte and Touche has raised the red flag after agro-industrial concern Ariston’s liabilities outstripped the company’s assets, signaling viability constraints which the company attributed to a poorly performing economy.

In its audit opinion accompanying the company’s 2014 annual report, Deloitte said the perennial loss-making position of Ariston reflected the company’s weak position.

Chief executive officer Paul Spear however told The Source the company was not beyond salvaging and that its major shareholder had shown commitment to boost its balance sheet, adding that the position was reflective of the general underperformance of companies in general.

“As at 30 September 2014, the group had an accumulated loss of $179,712 (2013:$797,076) and as of that date the group’s current liabilities exceeded the current assets by $2,373,360 (2013:$4,297,624,” Deloitte said in an opinion dated December 30.

“These events indicate a material uncertainty that may cast significant doubt on the group’s ability to continue as a going concern and therefore the company may be unable to realize its assets and discharge its liabilities in the normal course of business.”

Spear said the company’s majority shareholder; Chris Conradie had undertaken to recapitalize the company.

“Probably 80 percent of companies in Zimbabwe are technically insolvent and we are one of them. Chris Conradie is our major shareholder and he made a commitment to support the business. With this support we will be out of trouble from a going concern point of view,” Spear said.

He said during the first four months to January, macademia volumes were ahead of target although tea volumes were down due unfavourable global trends. – The Source

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