GMB unfazed by $176m losses
GMB silos: The parastatal continues to operate under going concern status.
GRAIN Marketing Board (GMB) management says it is unfazed by the company’s cumulative $176 million losses as government will inject more resources.
This was after auditor general Mildred Chiri had warned that GMB’s going concern status would be hampered by the mounting losses.
GMB’s liquidity position in the year to March 31, 2016 was significantly sound with current assets at $131 million against $45 million current liabilities. This translated to about $86 million working capital. This represented a $36 million rise from $50 million the previous year.
Chiri said she was concerned about the $42 million loss the firm had posted during the review period, from $58 million the previous comparable period.
“Without further qualifying my opinion, I draw attention to note 26 of the financial statements which indicate that the board made a loss of $42,2 million (2015;$58,1 million loss) and had accumulated losses amounting to $176,5 million as at March 31, 2016,” the auditor had warned.
“These circumstances indicate the existence of a material uncertainty that may cast significant doubt about the board’s ability to continue operating as a going concern,” she noted.
But the GMB board said it was confident that State interventions through tax payers’ funds would stabilise the operations and assure its continued existence.
“The directors have assessed the ability of the board to continue operating as a going concern and believe that the preparation of these financial statements on a going concern basis is still appropriate,” said the board in a statement accompanying the financial results that were released last week.
“However, the board made a loss of $42,2 million (2015;$58,1 million loss) and had accumulated losses amounting to $176,5 million as at March 31, 2016. The board does not believe the losses will have a significant impact on its ability to continue operating as a going concern because of the continued funding it receives from the government,” the board said.
State firms have are known for bleeding the broke government.
They go cap in hand to government for interventions each time they are pushed to the wall due to a number of factors including financial mismanagement.
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