Massive fraud at companies such as Steinhoff have undermined the public’s trust in the accountancy profession. Photo: David Harrison
Massive fraud at companies such as Steinhoff have undermined the public’s trust in the accountancy profession. Photo: David Harrison

An entire profession brought into disrepute

By Edward West Time of article published Sep 7, 2020

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CAPE TOWN - CERTAIN individuals in the accountancy profession had “dropped the ball” and brought the entire profession into disrepute, the chief executive of the South African Institute of Professional Accountants (Saipa), Shahied Daniels, said last week.

He said the image of the profession had been “tarnished” by the many accounts of corruption in the private and public sectors in South Africa, and a review of the role that accountants play in companies and organisations, including the role of ethics and training, and an “upskilling and reskilling” of members, was under way at Saipa to help regain the public’s trust in the profession, he said.

He said the review should ensure that self-regulating bodies such as Saipa, which has more than 10 000 private and public sector accountants as members, deal with unethical behaviour timeously.

He said additional regulations had not proved effective in promoting ethical behaviour. For instance, Saipa had made ethics a compulsory aspect of its continuing professional development programmes.

He said the fourth industrial revolution would result in “deep and lasting” changes to the accountancy profession, and the review by Saipa would see its members ready to participate in the changes that were coming to the profession.

In response to a question about how accounting teams had, over periods of many years, missed massive frauds at companies such as Steinhoff and Tongaat Hulett, he said the role of accountants was not specifically to detect fraud, and the incidences of fraud were frequently not part of the business samples worked with by accountants.

He said it was the top accounting and financial staff at companies, including the chief financial officer and financial director, who might be members of professional bodies such as Saipa who hold the responsibility to be fully accountable for the accounts.

He said Saipa believed the South African Qualifications Authority should enhance the disciplinary processes for self-governing bodies, so that organisations such as Saipa could hold its members to better account in circumstances of unethical behaviour.

Saipa’s technical and standards executive, Faith Ngwenya, said self-regulating organisations such as Saipa needed to be able to hold the government to better account on matters of auditing and accountancy, because, although there were good regulations, the government failed to implement them, and the result was “where we have got corruption out of control”.

BUSINESS REPORT

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