Eskom delays publication of annual financial statements

Ailing state-owned entity Eskom has delayed the publication of its annual financial statements for the year, which ended 31 March 2022, after failing to appoint external auditors as announced on 4 November 2021.

The parastatal said the delay is also the result of the extensive process of taking on a new audit, as well as the time it has taken to resolve several issues that were raised during the audit.

Annual financial statements

It said management is working hard to finalise the audited annual financial statements for the year ended, which is 31 March 2022, and is committed to publish these by the end of November 2022.

“Eskom is currently resolving, together with the auditors, anticipated restatements to its previously issued audited financial statements for the prior year ended 31 March 2021, which will have an impact on the Eskom Group’s statements of financial position and income statement.”

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Anticipated restatements

The struggling SOE said some of the anticipated restatements include reclassification of coal stocks from current assets to non-current assets.

“Following a review of the quantity and usage of coal stocks at power stations, it was concluded that a portion of the coal stocks will not be utilised within the normal operating cycle, as certain of these coal stocks result from coal purchases under take-or-pay arrangements exceeding use over a number of years, or are in excess of those levels required to be held to comply with the grid code and for emergencies to ensure security of supply.”

“Reclassification of certain electricity debtors from current to non-current; a single discount rate was previously used to present value power station-related environmental restoration and mine-related closure cost provisions.

Other adjustments

An adjustment is proposed to effect discount rates matching the expected timing of the associated cash flows on a per site basis, thereby increasing net finance costs,” Eskom said.

Eskom said other restatements include various adjustments to property, plant and equipment, which include assets for which incorrect useful lives have been used, extension of asset useful lives not accounted for.

“Insufficient consumable stock obsolescence provisions; and re-presentation of segmental reporting as the segmental financial information presented did not align to financial information presented internally as required by IAS 8 Operating Segments.“

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