According to the Public Accountant’s and Auditor’s Board (PAAB), there Zimbabwe is now going through a hyperinflationary period. This is despite hollow assurances that inflation will fall by Finance Mthuli Ncube in his budget paper.
PAAB are in charge of regulating the conduct of auditors and accountant’s in Zimbabwe according to the law. Whatever they say goes. If they say there is hyperinflation all businesses will take notice.
In their first pronouncement: Pronouncement 01 of 2019 PAAB had this to say:
PAAB can advise that there is broad market consensus within thePAAB Pronouncement 01/2019
accounting and auditing professions that the factors and characteristics to apply the Financial Reporting in Hyperinflationary Economies Standard (IAS 29), in Zimbabwe have been met.
The government still continues to stick its head in the sand
One historical problem of the Zimbabwean government is that they like to downplay problems. Usually that is coupled with them pretending the problem does not exist. No steps are taking to solve the problem either as officials jostle to praise their leadership and vision even when the country is sinking.
This happened in 2008. What we are going through is what we were going through during the 2006-2007 period. Finance and Central bank officials would team up to assault the public and the economy with unconventional, rashed, thoughtless and bold economic policies such as operation sunrise when we’re forced to switch to a new currency within weeks.
Suffice to say none of those things worked as people had lost faith in the system. The same is happening now. People simply don’t trust what the government has to say. In their arrogance, the government has burned all the bridges. No one, for example, believes the RBZ will not take the foreign currency in your FCA account.
They probably will. They say there is no hyperinflation, we have hyperinflation in Zimbabwe. How can we believe the government when it lies so often.