Heavy hitters could summon Moyane in KPMG probe

KPMG. Image: RF123 Stock Photo
KPMG. Image: RF123 Stock Photo

The South African Institute of Chartered Accountants has put together a panel with inquisitorial powers to investigate KPMG employees -- which could include summoning SA Revenue Service Tom Moyane over the contentious report the audit firm produced for the tax agency.

KPMG is at the centre of state capture allegations and the fall-out over its work for the controversial Gupta family. Its report into the alleged rogue unit at SARS led to the departure of nine senior executives‚ including its former CE Trevor Hoole.

SAICA is now targeting individual KPMG employees who are also its members‚ as the Independent Regulatory Board for Auditors is probing the audit firm as an institution.

KPMG has admitted to flaws in its work on Gupta-linked companies and has withdrawn the recommendations contained in its SARS report‚ which implicated former finance minister Pravin Gordhan.

The SAICA panel will conclude its work in five months‚ is chaired by Advocate Dumisa Ntsebeza and includes Dr Claudelle Van Eck – the CEO of the Institute of Internal Auditors‚ former chair of the Johannesburg Stock Exchange Bobby Johnston‚ former accountant general at the national treasury Freeman Nomvalo‚ former Auditor General and SAICA CE Terence Nombembe and Advocate Vuyani Ngalwana.

It will look into whether any of its members employed by KPMG had violated the institute’s constitution and code of conduct.

Speaking to Business Day on the sidelines of a media briefing on Thursday‚ Ntsebeza said the probe was set to be inquisitorial.

“I can’t see why we cannot ask any or all reports SARS has on KPMG … I will invite Tom Moyane‚ or anyone who can shed light on what went on‚ to provide submissions to the panel”

“I can’t see why we cannot ask any or all reports SARS has on KPMG … I will invite Tom Moyane‚ or anyone who can shed light on what went on‚ to provide submissions to the panel‚” he said.

Moyane has resisted the withdrawal of the report by KPMG as it was used to purge senior leaders from the tax agency. The report was also at the heart of the bitter battle between Gordhan and Moyane when the former took over as finance minister at the end of 2015. During Gordhan’s first media briefing as minister at the time‚ he called out KPMG for its conduct in compiling the report.

This was after a memorandum emerged in which Moyane’s attorney had instructed the KPMG auditor compiling the report‚ Johan van der Walt‚ on the findings that should be made.

The terms of reference of the probe specifically mention the SARS report‚ but are not limited to the matter or confined to the allegations surrounding the Gupta accounts. During the first phase‚ which will last a month‚ submissions can be made to the panel relating to a period between January 1‚ 2013 to September 15‚ 2017.

Members implicated could face disciplinary action and censure but the terms of reference also include the possibility of referring the matter to law enforcement agencies for prosecution.

Ntsebeza emphasised that SAICA’s inquiry was not intended to usurp the regulatory authority of the Independent Regulatory Board for Auditors (IRBA).

He was vague on the extent of KPMG’s cooperation‚ saying he has not met the audit firm since becoming chairman.

“I am hoping to interact with the CEO‚ to inform them of the terms of the inquiry‚” he said.

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