TELECOMMUNICATION firm, NetOne Private Limited has been revealed to be technically insolvent and runs the risk of being unable to continue operating, a new report shows.
In a report released last Friday, acting Auditor-General (AG) Rheah Kujinga said the firm’s total liabilities exceeded the total assets by ZWL$32 billion in 2022.
“The company’s total liabilities exceeded the total assets by ZWL$32 billion, while the current liabilities exceeded the current assets by ZWL$20,9 billion (2021: ZWL$20,5 billion),”
Kujinga said.
“These conditions indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern. My opinion was not modified in respect of this matter.”
Typically, a company’s inability to continue as a going concern means that there are significant concerns about whether it can continue operating and meet its obligations for the foreseeable future.
While this is typically defined for at least the next 12 months, which for NetOne would be last year, the firm has been losing active subscribers which could indicate some vulnerabilities.
In the first quarter of 2024 the firm recorded a 5,52% dip in active subscribers to 4 017 167 from the previous quarter.
The Postal and Telecommunications Regulatory Authority of Zimbabwe reported that NetOne’s market share contracted by 6,66 percentage points to 11,84% in the first quarter from the fourth last year.
NewsDay
