Audit firms are up in arms

South Africa’s biggest audit firms are riled by amendments to legislation that could give the Independent Regulatory Board for Auditors (Irba) search and seizure powers during investigations into financial reporting failures.

If proposed amendments to the Auditing Profession Act by National Treasury pass muster in parliament, they will give Irba the power to search the premises of auditors and seize documents. Irba’s investigating committee will be able to enter auditors’ premises without notice if it has a court warrant.

SA’s biggest auditors oppose the proposed amendments, saying Irba’s powers would be extreme. Audit firms are facing a credibility crisis for complicity in the state capture project.

Irba has finalised its investigation against former KPMG employee Jacques Wessels, who allegedly helped the Guptas commit tax evasion of over R2 million. KPMG is also implicated in the VBS scandal. Irba is also probing Deloitte partners for missing red flags in African Bank and signing off Steinhoff’s books after it admitted to accounting fraud.