AG's retention of KPMG disappointing - EFF

Fighters say all sensible and patriotic companies that want to fight corruption have distanced themselves from firm


Wednesday, October 4, 2017

The Economic Freedom Fighters notes with disappointment the decision by Auditor-General South Africa (AGSA) to retain the services of KPMG SA. On the 29 September 2017, AGSA in their press statement acknowledge that their arrangements and relationship with all the firms with whom they contract must be based on the fundamental principles that define an auditor, and these are independence and professional competence to carry out the audit in accordance with auditing standards. Yet, AGSA takes a wrong conclusion to continue to secure services of KPMG SA.

There is indisputable and concrete evidence to clearly demonstrate that KPMG SA has been part of the Gupta-led syndicate to loot state resources. The involvement of KPMG SA as auditors, forensic investigators and financial advisors have been central to and aiding the Gupta criminality. In KPMG SA's own admission, as auditors, they have conducted themselves in an unspeakable manner, and have cost South Africa billions of rands, racked South Africa Revenue Services' (SARS) capacity and undermine South African laws, and all this because of uncontrollable greed and the pursuit of profit.

Since the revelation about KPMG SA's involvement with the Gupta-led syndicate, all sensible and patriotic companies that want to fight corruption have distanced themselves from KPMG SA. So far, Business Leadership South Africa (BLSA) decided to suspend the KPMG SA membership. Institute of Directors Southern Africa have cut ties with KPMG SA. JSE listed Sygnia SASFIN fired KPMG as their auditors as early as July 2017. Parliament of the Republic of South Africa has also cancelled their contract with KPMG SA.

The Minister of Finance has called on all government and state-owned entities to review all work KPMG SA has done. Companies like ABSA, African Oxygen, Bidcorp, DRGold, Esor, Gaia Infrastructure Capital, Interwaste Holdings, Investec, Lonmin, Randgold and Exploration, Sibanye Stillwater, Vunani and Wesizwe Platinum all confirmed that they were reviewing their relationship with KPMG SA. Recently, University of Witwatersrand announced that they have also cut ties with KPMG SA, and companies across all sectors continue to cut ties with KPMG.

The EFF is shocked that such an important institution such as AGSA entrusted with the responsibility to ensure there is credibility in government financial reporting systems has decided to continue to secure KPMG services despite all evidence of lack of independence, professionalism and criminality in the conduct of KPMG SA.

The EFF calls on AGSA to review their decision not to cut ties with KPMG SA, and cancel all standing contracts with KPMG SA. Failure by AGSA to cut ties with KPMG SA brings the credibility of all audits conducted by the company into serious question and cannot be trusted, therefore undermining the credibility and mandate of AGSA.

Statement issued by the Economic Freedom Fighters, 4 October 2017