KPMG debacle spurs auditors body to mull suspensions
The South African Institute of Chartered Accountants (Saica) is considering whether to place members accused of wrongdoing on precautionary suspension while it waits for the outcome of investigations or disciplinary processes.
This comes in the wake of an outcry from the public and Saica’s members over the slow pace of addressing the matter, said its chief executive, Terence Nombembe.
Saica has about 42 000 members, 4 000 of whom are registered auditors.
As a professional body with no investigating capacity, the institute relies on the outcomes of external investigation procedures.
The “unprecedented” uproar over auditing firm KPMG’s complicity in state capture — relating to business it conducted for the Gupta family as well as the South African Revenue Service — prompted Saica to establish an independent inquiry into the matter, which is ongoing, he said.
Instituting such an inquiry is by no means the norm for Saica, Nombembe pointed out.
The investigation is being carried out in parallel with a probe launched by the Independent Regulatory Board for Auditors, a statutory body.
But now questions have been raised about what Saica will do in relation to other members who are embroiled in state capture allegations.
Not least of these is suspended Eskom chief financial officer Anoj Singh, who remains a chartered accountant registered with Saica despite evidence suggesting that he facilitated questionable business deals that allowed billions of rands to flow from state-owned entities to companies connected to the Guptas.
Nombembe said the Saica board was looking at a precautionary suspension in response to this concern.
“We require lawyers to ensure us that it is watertight … that it is legally justifiable,” said Nombembe.
“We would have to change bylaws, and members would have to vote for that in the AGM [annual general meeting].”.