The Board of the Institute of Directors in Southern Africa (IoDSA) has “temporarily” suspended all co-branded events with auditing firm KPMG following damning allegations of misconduct related to audits of Gupta-owned companies.
The body, representing all directors in South Africa, said it will make a final decision whether to suspend relations permanently once several investigations into the firm’s conduct have been completed.
There are currently two investigations on the go. One is an internal investigation by KPMG International and the other an investigation by the Regulatory Board for Auditors (Irba).
“The IoDSA Board will continue to monitor the matter until a standing decision can be made, based on factual findings in relation to the current allegations and media reports,” the statement read.
As a consequence of the decision, the IoDSA suspended KMPG’s sponsorship of its golf day scheduled for October 9 and suspended the audit firm’s involvement in the Audit Committee Forum.
A few weeks ago, asset management firm Sygnia cut ties with KPMG following media reports that KPMG did not pick up on serious irregularities during its audits of Gupta-linked companies.
The most pertinent of these is that KPMG did not pick up through its audit of Linkway Trading the R30 million earmarked for an agricultural development project in the Free State, which was diverted to pay for the infamous Gupta wedding in Sun City.
The announcement triggered some reaction on Twitter:
KPMG has become "the ANN7" of the audit profession!Auditors who violate their oaths are like politicians who violate their oath of office.
— Iraj Abedian (@IrajAbedian) September 7, 2017
ioDSA aren't the fastest out of the blocks, usually. This is an interesting move. https://t.co/xA9j1xM8c7
— Angelo Coppola (@AngeloCoppolaSA) September 7, 2017