September 30, 2022

Trustco: Update on Trustco and the dispute between JSE and International Financial Reporting Standards (“IFRS”)

TRUSTCO GROUP HOLDINGS LIMITED Incorporated in the Republic of Namibia (registration number 2003/058)

Registered as an external company in South Africa (external registration number 2009/002634/10) NSX stock code: TUC

JSE share code: TTO


ISIN Number: NA000A0RF067 (“Trustco” or “the Group”)


Ongoing litigation

1. Trustco refers to the announcement posted on SENS on June 29, 2022 in which interim financial statements were released for the period ended February 28, 2022 (“Interim Results”) together with an update on the ongoing litigation. course between the JSE and Trustco.

Executive Summary of Trustco

2. Shareholders have been updated from time to time on the dispute between Trustco and the JSE. The two remaining issues in dispute between Trustco and the JSE relate to the classification of the gain recognized in profit or loss by Trustco following two separate loan waivers by the majority shareholder for amounts of NAD (Namibia Dollar) 546 million and NAD 1 billion respectively. , and the reclassification of part of a real estate development from inventory to investment properties.

  1. The dispute only affects Trustco’s investments in the Real Estate Holding Entity and the Resource Holding Entity and has no effect on the net asset value (NAV) of the group.
  2. The JSE argues that Trustco failed to comply with the JSE’s listing requirements and relevant IFRS accounting standards and the JSE advised Trustco to restate its financial statements. Trustco disputes the alleged non-compliance with IFRS and the JSE listing requirements and therefore the parties and their respective IFRS expert advisors remain in disagreement regarding the correct IFRS accounting treatment of the disputed transactions.
  3. The JSE (and its advisory body FRIP) disagreed with Trustco’s accounting treatment and applied substantive rather than procedural treatment, without the JSE being able to point to a single accounting standard that was breached by Trustco.
  4. As the Financial Services Tribunal granted deference to the JSE, Trustco approached the High Court of South Africa for an urgent injunction against the JSE.

Failure by JSE to comply with its own registration requirements

  1. It should be noted that the JSE (and the FRIP) did not, in accordance with their terms of reference and in accordance with the registration requirements, refer the matter to the South African Institute of Chartered Accountants (SAICA), at the Independent Regulatory Board for Auditors (IRBA) or any competent body. professional body to obtain an additional independent opinion in the event of an issuer’s non-compliance with IFRS standards.
  2. Trustco further claims that the JSE’s decision was made by a person not authorized to make such a decision and imposes a penalty which the JSE was not empowered to make.
  3. The JSE has further imposed a sanction which is absent and not provided for in the JSE’s registration requirements.
  1. The Chairman of the Financial Services Board, contrary to legislative requirements, appointed a panel of three representatives consisting only of a former and two practicing legal practitioners with no financial, accounting or IFRS experience or qualifications, with the result that the Tribunal failed to interpret certain important considerations that a properly qualified IFRS practitioner should have taken into account.
  2. The JSE’s registration requirements include the business judgment rule, and the JSE and subsequently the Financial Services Tribunal erred by not applying the business judgment rule at all or by applying the business judgment rule against Trustco’s board of directors. The Board of Directors was in the best position to make an informed decision after considering all relevant facts and after taking professional advice and guidance from its JSE approved independent external IFRS advisors. The accounting treatment of the transactions was then audited by Trustco’s JSE accredited independent auditors and approved by its shareholders with a vote of 99.99%.

Trustco position

  1. Trustco’s Board of Directors, having consulted its experts and external JSE-accredited IFRS auditors, and having concluded several unmodified and unqualified audits by two independent JSE-accredited audit firms, maintains its position that the transactions have been properly recorded, reported and disclosed.
  2. The Board of Directors (not the JSE) remains responsible and accountable to Shareholders for the preparation and presentation of the financial statements and their compliance with IFRS. The Board cannot abdicate this responsibility to third parties who are not professional advisers mandated by the Group.
  3. It is important to note that Trustco and the JSE are at an impasse over a difference of opinion on the interpretation and application of IFRS. Importantly, the JSE made no allegations of fraud, misconduct or wrongdoing by Trustco or its board.

15. Trustco’s auditors have provided Trustco with unmodified (unqualified) audit reports for the past 29 years, the latest being issued on January 31, 2022.

status quo

16. In the interests of transparency and full disclosure, the documentation relating to the request for review, the request for reconsideration, the request for suspension and the urgent request can be consulted at are invited to read the documentation to learn about the nature of the dispute and its status.

Shareholders will be kept informed from time to time and the website will be updated as these matters develop. Shareholders are also invited to contact the Company Secretariat for further information at

Windhoek, Namibia,

July 15, 2022

Komada Holdings (Pty) Ltd

Company Secretary and Investor Relations Services for Trustco Group Holdings Limited

JSE Sponsor

Vunani Sponsors (Pty) Ltd – Johannesburg

NSX Sponsor

Simonis Storm Securities Proprietary Limited – Windhoek

OTCQX Sponsor

JP Galda & Co – New York


Trustco Group Holdings Limited published this content on July 15, 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unmodified, on July 15, 2022 12:13:07 UTC.

Public now 2022


Sales 2021 347M
20.4 million
20.4 million
Net income 2021 -951M
Net debt 2021 1,863 million
PER 2021 ratio -2.72x
2021 performance
Capitalization 822M
EV / Sales 2020 16.1x
EV / Sales 2021 12.8x
# of employees 663
Floating 44.7%


Duration :

Period :

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Evolution of the income statement