KPMG South Africa has resigned from the position of external auditors for the South African Institute of Chartered Accountants (SAICA) due to perceived independence concerns if KPMG were to perform the 2018 audit.
KPMG South Africa is currently under investigation by the SAICA-appointed Ntsebeza inquiry which is investigating the conduct of some SAICA members employed by KPMG. The inquiry’s report is due to be concluded by the end of June 2018.
SAICA has begun a tender process to appoint external auditors. SAICA’s board plans to report on the progress of this at the AGM to be held on 26 June.
Following the resignation, KPMG South Africa has announced it is to reshape its business which will see some regional offices close in South Africa which is anticipated to cause 400 people to leave the firm.
KPMG South Africa has said the reshuffling of its business will rely on the support of its international network. Its intention is to reposition senior KPMG partners from other countries into board and executive positions, and senior client service roles, in its South African firm.
KPMG South Africa has been involved in a range of controversies over the past year which includes the work it conducted for the Gupta family, which in part led to the firm being banned from conducting public sector audits in the country.