KPMG urged to take more 'decisive action' to root out corruption
The firm has lost clients in light of recent controversies linked to state capture.
JOHANNESBURG - Business Leadership South Africa (BLSA) says it will only consider reinstating KPMG’s membership when more decisive action is taken to root out corruption at the auditing firm.
BLSA says its decision to suspend the firm's membership is unprecedented, but it couldn't ignore the gravity of KPMG’s conduct as it had become party to the project of state capture.
KPMG International cleared out its South African leadership last week, withdrew its findings and recommendations from the controversial Sars report into the intelligence unit, and admitted to mistakes made when working for Gupta-linked companies.
The firm has lost clients and Finance Minister Malusi Gigaba has called on government and its entities to review work done by KPMG to ensure audits haven’t been compromised.
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BLSA’s Bonang Mohale says the auditor's actions have not only cast the industry in a bad light but also business in South Africa.
“We are absolutely explicit in our actions. We will be working with them hand in hand as this situation changes. We will be by their side as they go through this fire.”
BLSA says KPMG needs to do more to redeem itself as it has damaged the country.
Mohale adds: “We know that the NPA head is captured, the same way that we know that policing is captured. The prosecutorial services are captured... that's two of the three criminal justice system. The only thing that stands between us and anarchy is our independent judiciary and that is thanks to Chief Justice Mogoeng Mogoeng.”
Saftu has accused BLSA of double standards following the organisation's decision to suspend KPMG’s membership.
Saftu general secretary Zwelinzima Vavi says while the move is welcomed, BLSA should be more consistent and also suspend companies that were found to be in the wrong by the Competition Commission.
“What about McKinsey, SAP, Bell Pottinger and others who are implicated in this theft and looting of state-owned enterprises, Like Eskom and Denel?”
He adds this action would have discouraged other companies from similar activities.
“This would have gone a long way from stopping the political hyenas from destroying our children’s futures.”
(Edited by Shimoney Regter)