JOHANNESBURG, September 15 (ANA) – Business Leadership South Africa (BLSA) has welcomed the leadership reshuffle at audit firm KPMG South Africa and the firm’s willingness to act decisively following controversy over audits and reports.
This comes as Trevor Hoole tendered his resignation on Friday as the chief executive KPMG South Africa following a storm created by the work the firm did for the South African Revenue Service (Sars) and the Gupta family.
Chief operating officer and country risk management partner Steven Louw stepped down. Five other senior partners of KPMG SA also decided to leave the firm.
Nhlamu Dlomu, previously KPMG SA’s head for people and change, was asked to take over from Hoole.
In a statement, BLSA also called in government to take a leaf out of KPMG’s example in dealing with allegations of wrongdoing.
“Business Leadership South Africa (BLSA) has welcomed the findings of KPMG’s investigation and its willingness to act decisively,” BLSA said in a statement.
“It is important that when business is accused of wrongdoing it does the right thing. We also call upon government to act decisively whenever it is accused of corruption or wrongdoing.”
In December 2014, KPMG SA was commissioned by the Sars to perform an extensive document investigative review about a rogue unit allegedly set up by former finance minister, Pravin Gordhan, who was SARS commissioner at the time. The investigation resulted in the “Report on Allegations of Irregularities and Misconduct”.
On Friday, KPMG said that the evidence in the documentation provided did not support the interpretation that Gordhan knew, or ought to have known, of the “rogue” nature of this unit. The firm said it recognised and regretted the impact its report has had, and that it had “no political motivation or intent to mislead”.
KPMG then “offered to repay the R23 million fee” it received for the work performed for Sars, or “to make a donation for the same amount to charity”.
The firm also investigated the relationship that its partners had and the auditing work it had done for companies owned by the controversial and politically exposed Gupta family, including Linkway Trading, a company which was implicated in siphoning millions of rand from a Free State dairy farm project to fund the wedding.
Four of KPMG partners attend the lavish Gupta wedding at Sun City in 2013.
Though KPMG said its investigation into the report on the did not identify any evidence of illegal behaviour or corruption, it did find that work done for Gupta family firms “fell considerably short of KPMG’s standards” and that “the audit teams failed to apply sufficient professional scepticism and to comply fully with auditing standards”.
The firm also accepted that the partners should not have attended the Gupta wedding.
KPMG said it would be donating R40 million it had earned from Gupta related entities since 2002 into education and anti-corruption not-for-profit organisations.
– African News Agency (ANA)
