Auditor BDO SA dumps Survé
Beleaguered media boss Iqbal Survé was dealt another body blow on Thursday, when auditor BDO SA gave notice that the firm would no longer audit his companies.
In an internal notice to the firm’s partners, CEO Mark Stewart said that “after careful consideration, BDO SA will not be seeking a renewal of its mandate with the following clients: Africa Equity Empowerment Investment Limited; Ayo Technologies; Independent Media Group; and Premier Fishing and Brands.”
Stewart did not provide reasons, saying that “it is important to note that all matters between BDO SA and our clients are absolutely confidential and we are bound to respect such confidentiality at all times”.
A spokesperson for the
company, Genea Tehini, confirmed the decision.
However, Sekunjalo says it had already informed BDO that it would be changing its auditors as it wanted to rotate firms and also believed that BDO was not transformed enough.
“Sekunjalo cannot speak for the listed companies under its group umbrella but, as the majority shareholder, Sekunjalo had already resolved that it was not going to support the reappointment of BDO as auditors to the listed entities in which it has a stake,” it said.
“The board had determined that it is duty-bound to seek opportunities for black professionals and black firms, especially ahead of the mandatory audit firm rotation due to come into effect on 1 April 2023.
“It is for this reason that Sekunjalo had earlier drafted a letter to the chairman of BDO and met with the managing partner of BDO today in Cape Town to give BDO fair notice,” said the statement.
Survé has had a torrid week. Last Wednesday, the premises of his Sekunjalo Investment Holdings were raided by the Financial Sector Conduct Authority in relation to an investigation into the share price manipulation of Ayo Technologies.
On Tuesday this week, the Public Investment Corporation (PIC) told MPs that it was considering the liquidation of Sekunjalo because it had failed to repay a 2013 loan extended to the company to purchase Independent Media SA.
Survé has claimed the raid is part of a political conspiracy against him. He has also threatened to sue the PIC for its comments, which he says were incorrect as it had not lent any money to Sekunjalo Investment Holdings and the Sekunjalo group, while Sekunjalo Independent Media is a separate, ring-fenced juristic entity.
AYO INVESTMENT
The PIC is also litigating against Ayo to reclaim its invested amount of R4.3bn in Ayo on the grounds that Survé misrepresented its assets in the transaction. In April, allegations by a former Ayo executive, Kevin Hardy, were made at the Mpati commission into corruption at the PIC that Survé ordered him to tamper with a financial report.
Following this, the JSE asked Ayo to get an opinion from external auditors on both the 2018 interim results and the interim results for the six months ended February 28 2019. Auditors are not usually required to provide assurance on interim financial results, but the JSE said that “in light of the uncertainty” as well as “the importance of accurate financial information”, it had requested an auditor’s opinion.
BDO did not respond to a question whether it had done the audit for Ayo. The JSE also did not respond to whether it had received the audit report.