First Mutual Holdings Limited (FMHL) has suspended its Annual General Meeting (AGM) pending a forensic audit into allegations that the organisation defied the law on separation of insurance and pension businesses.
The firm is alleged to have submitted an unsatisfactory report during an assets separation exercise.
The Insurance and Pensions Commission (IPEC) has since appointed a forensic investigator to probe the second-largest life assurance company in Zimbabwe by market share which specialises in retirement, medical insurance, micro-insurance and other long-term financial security products.
In a memorandum to its shareholders, FMHL announced that AGM had been indefinitely suspended pending forensic investigations.
“First Mutual Holdings Limited (FMHL) has been unable to conduct its Annual General Meeting (AGM) within twelve months of the previous AGM as the external auditors are yet to issue their audit opinion for the year ended 31 December 2021,” read the the memo by group company secretary, SF Lorimer dated December 5.
“The delay arises following the appointment of a forensic investigator by the Insurance and Pensions Commission (IPEC) to conduct an investigation into First Mutual Life Assurance Company (Private) Limited, a subsidiary of FMHL.
“The auditors will only issue their opinion once that investigation has been concluded. The investigation, which began on 5 September 2022, is expected to take 4 months to complete. Hence it will not be possible to conduct the AGM before the end of 2022.
“Shareholders will be advised of the date of the AGM as soon as these processes have been finalised.”
IPEC on July 27 this year, issued a letter advising that the Finance Ministry had appointed BDO Chartered Accountants Zimbabwe, as the forensic investigator in line with the provisions of the Insurance Act (Chapter 24:07).
The regulator further noted that the investigation was expected to be completed within four months from the commencement date. The investigation formally commenced on 26 August 2022.
As a result the audit review of the group financial statements is incomplete pending the finalization of the forensic investigation of FML.