‘Do­nate Gupta money’

As it fi­nally acts, KPMG urged to give away money that was earned from con­tam­i­nated re­la­tions with the con­tro­ver­sial fam­ily

CityPress - - Business & Tenders - JUSTIN BROWN, DE­WALD VAN RENS­BURG and LESETJA MALOPE busi­ness@city­press.co.za To­tal

The as­set man­ager that fired KPMG as its au­di­tor last month says the com­pany has fi­nally done the right thing by sus­pend­ing em­ploy­ees to con­duct a probe. Syg­nia As­set Man­age­ment fired KPMG over its al­leged role in state cap­ture as well as un­hap­pi­ness about KPMG’s probe of al­le­ga­tions of a “rogue unit” at the SA Rev­enue Ser­vice.

Syg­nia CEO Magda Wierzy­cka told City Press on Fri­day: “From the press re­lease, it looks like KPMG In­ter­na­tional (KPMGI) is now in­volved and the pres­sure might have come from them, as well as from nu­mer­ous cor­po­rate clients who fi­nally started ask­ing the right ques­tions. I am, how­ever, sur­prised that it took KPMG SA so long to ar­rive at the right con­clu­sion.

“I strongly be­lieve that, as a ges­ture of good­will to­wards the cit­i­zens of South Africa, KPMG should do­nate all the fees they made from the nu­mer­ous Gupta com­pa­nies they pro­vided ser­vices to, to char­i­ties and to civil rights or­gan­i­sa­tions fight­ing cor­rup­tion.”

With­out di­vulging names, she told City Press that at least six large com­pa­nies us­ing KPMG had con­tacted her af­ter her com­pany dropped the au­dit firm.

Not ev­ery­one was happy. Some of Syg­nia’s own clients use KPMG as their au­di­tors and have ex­pressed un­hap­pi­ness with Wierzy­cka’s ac­tions be­cause it puts them in a dif­fi­cult spot.

Iraj Abe­dian, Pan-African In­vest­ment and Re­search chief econ­o­mist, said in a post on Twit­ter that 70 pri­vate sec­tor com­pa­nies that have deal­ings with KPMG were ef­fec­tively con­don­ing KPMG’s role in the state cap­ture loot­ing. “Out­right wrong!” he ex­claimed.

KPMG’s ac­tions are “too lit­tle too late”, said Wierzy­cka. “If you look at SAP, they did pre­cisely what you should – they sus­pended ev­ery­one.”

Syg­nia is ten­der­ing for a new au­di­tor and two of the so-called Big Four have ex­pressed in­ter­est, she said. One of them did not want to get in­volved, she said. “There is blood in the wa­ter now.”

KPMG SA has sus­pended one au­dit part­ner and “re­lieved” two ex­ec­u­tives from their po­si­tions as the com­pany probes the work it did for Gupta com­pa­nies.

The au­dit com­pany said it had sus­pended the lead au­dit en­gage­ment part­ner en­gaged with the Gupta busi­nesses, but did not name the part­ner.

Two KPMG part­ners had been “re­lieved of their board and ex­ec­u­tive po­si­tions” pend­ing the out­come of the com­pre­hen­sive re­views.

The firm again did not name the two peo­ple in­volved. Trevor Hoole, KPMG SA CEO, said in a state­ment on Fri­day that the group had taken al­le­ga­tions re­lated to its work with Gupta-re­lated com­pa­nies “ex­tremely se­ri­ously”.

“The KPMG SA board im­me­di­ately ini­ti­ated a com­pre­hen­sive re­view,” Hoole said.

Ku­lani Chauke, an SA In­sti­tute of Char­tered Ac­coun­tants spokesper­son, of which KPMG is a mem­ber, de­clined to com­ment on Hoole’s state­ment.

“Where any prob­lems or is­sues are found, those KPMG in­di­vid­u­als re­spon­si­ble will be held ac­count­able,” Hoole said. “We also note that KPMG has re­ceived crit­i­cism re­gard­ing the ‘SA Rev­enue Ser­vice re­port’. The re­view be­ing con­ducted by KPMGI will be ex­tended to in­clude KPMG’s role in this re­port.

“It is now clear that, based on pub­licly avail­able in­for­ma­tion, KPMG should have re­signed ear­lier than March 2016 and should have stopped work­ing for the Gupta com­pa­nies sooner than we did,” Hoole said.

KPMG ac­cepted that four of its part­ners should not have at­tended the Gupta wed­ding in 2013, Hoole said.

“Mis­takes have been made and painful lessons learnt. We com­mit to take ev­ery ac­tion nec­es­sary to ap­ply th­ese learn­ings,” Hoole said.

The In­de­pen­dent Reg­u­la­tory Board for Au­di­tors has been prob­ing KPMG’s in­volve­ment in the Gup­tas’ Oak­bay Group since June. Brazil Rus­sia In­dia China SA

BNDES, Brazil’s na­tional bank for eco­nomic and so­cial devel­op­ment

Eurasian Devel­op­ment Bank and In­ter­na­tional In­vest­ment Bank

Ca­nara Bank Govern­ment of In­dia

Shang­hai Lin­gang Hongbo New En­ergy Devel­op­ment Co.

Pu­tian Ping­hai Bay Off­shore Wind Power Project

Eskom Hold­ings

300 100 250 350 81 298 180

To sup­port re­new­able en­ergy and trans­mis­sion projects. A di­ver­si­fied set of sub­pro­jects in so­lar, wind, hy­dropower and other ar­eas with ad­dional ca­pac­ity of 600MW will be fi­nanced by BNDES on an on-lend­ing ba­sis

Con­struc­tion of small hy­dro­elec­tric power plants in Kare­lia with to­tal ca­pac­ity of 50MW On-lend­ing to re­new­able en­ergy projects in so­lar and wind en­ergy, hy­dropower and other ar­eas with a to­tal ca­pac­ity of 500MW of clean en­ergy

To up­grade ap­prox­i­mately 1 500km of major dis­trict roads in Mad­hya Pradesh

To sup­port a dis­trib­uted so­lar power project in the Lin­gang In­dus­trial Area. In this flag­ship devel­op­ment zone, rooftop so­lar power in­stal­la­tions will have a to­tal ca­pac­ity of 100MW

To gen­er­ate 873 mil­lion kWh of elec­tric­ity in the Ping­hai Bay in Pu­tian, Fu­jian Prove­nience

Fi­nanc­ing grid con­nec­tion in­fra­struc­ture for re­new­able en­ergy projects

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.