‘KPMG needs miracle for it to survive’
KPMG’s woes worsened yesterday after the South African Institute for Chartered Accountants (Saica) supported calls for a commission of inquiry into the auditing firm.
The calls came after Finance Minister Malusi Gigaba announced that the government would review all work done by the firm.
The DA has also said it would do the same in 30 municipalities it governs across the country.
Economist Iraj Abedian, of Pan African Capital, warned yesterday the government review would ruin the company.
“Basically, KPMG needs a miracle to survive. It’s almost untenable for it to continue,” said Abedian.
Gigaba said: “In the immediate term, and as a measure to restore confidence in audits, all of government and its entities must consider reviewing their work programmes with KPMG, to ensure that their audit processes have not been compromised in any way,” said Gigaba.
Saica said it wanted the commission of inquiry to be headed by a judge.
Saica chief executive Terence Nombembe, who is the former Auditor-General, said they did not downplay the work done by the Independent Regulatory Board for Auditors to probe KPMG.
“Saica has received widespread requests from its stakeholders including Saica members, significant players in the business and civil society as well as the general public to take a strong stand against unethical behaviour by its members,” said Nombembe.
Business Leadership South Africa (BLSA) also announced that it has suspended KPMG pending an investigation into the company.
This followed the engagement between the organisation and the firm.
BLSA said: “We are deeply concerned by the unethical and unprofessional conduct that KPMG engaged in in South Africa. The firm became party to the project of ‘state capture’, which has harmed our country, victimised certain individuals and damaged the reputation of business.” BLSA chief executive Bonang Mohlale said those who violated the law must be prosecuted.
Former finance minister Pravin Gordhan and his ex-deputy Mcebisi Jonas also met the KPMG delegation. Gordhan called on KPMG to be open about what has gone on there.