South African regulator to review KPMG's local turnaround strategy
Reuters
Published May 04, 2018 01:00PM ET
South African regulator to review KPMG's local turnaround strategy
JOHANNESBURG (Reuters) - South Africa's Independent Regulatory Board for Auditors (IRBA) said on Friday it had appointed a specialised team to review the turnaround strategy of KPMG’s scandal-hit South African arm.
The global auditor has been under close scrutiny since 2017 over work done for a company owned by the Gupta family -- who have been accused of using their links to former president Jacob Zuma to influence government decisions and the awarding of tenders -- and more recently for small lender VBS Mutual Bank.
The Guptas and Zuma have denied any wrongdoing.
The firm responded by appointing veteran public servant and former chairman of the Development Bank of Southern Africa Wiseman Nkuhlu as its chairman in January and said it was reviewing the work of its partners.
"The IRBA has taken the unusual step of mobilizing a specialized team specifically to do a review of KPMG’s turnaround strategy," the IRBA said in a statement.
The IRBA, which will start the review next week, referred a former KPMG employee to a disciplinary hearing in February over work carried out for Linkway Trading, a project management firm owned by the Gupta family.
Sibanye-Stillwater (J:SGLJ) is the latest company to consider a new auditor, saying on Friday it would start looking for a new auditor to replace KPMG.
This follows a decision by Barclays (LON:BARC) Africa (J:BGAJ), one of KPMG's major financial customers and South Africa's second-biggest lender by market value, to join more than 10 other clients, including the government and broker Sasfin (J:SFNJ), to break ties with KPMG since 2017.
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Written By: Reuters
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