File Photo.
File Photo.
Picture: David Ritchie/ANA
Picture: David Ritchie/ANA
CAPE TOWN - Embattled auditing firm  KPMG’s woes are far from over  as telecommunications firm  Telkom has joined the long list  of companies that have opted to  cut ties with KPMG.

An e-mail sent to Business  Report by an internal source  at Telkom yesterday reads:  “Telkom has taken note of  reports where allegations have  been made against organisations  offering services to  Telkom.

“The recent media reports  surrounding KPMG SA and  allegations around the conduct  of some of its employees have  been met with great concern.

Telkom conducts a substantial  amount of business with KPMG  and has taken the events very  seriously.

“We have engaged with our  Telkom Group Board Audit  Committee on this matter and  the audit committee has decided  that the Telkom Group will not  award any new business to  KPMG SA until the investigation  by the Independent Regulatory  Board for Auditors (Irba)  has been concluded.”

The source revealed further:  “Since the chairperson  of KPMG International has  announced that the company  will be launching its own  independent investigation  into the work conducted by  KPMG SA, Telkom took note  of the intent of the investigation  to address the allegations,  enhance business transparency  and rebuild trust with South  Africa.

“We emphasise that the decision  to withhold any further  awarding of business to KPMG  SA is subject to the outcome of  the final investigation report by  the Irba.”

The e-mail leaked to Business  Report was distributed  to Telkom employees from  the group chief risk and  compliance officer, Tsholofelo  Molefe.

The source stated, however,  that “any contracts and bodies  of work already underway in  the business with KMPG SA  must still be completed and  existing contracts will stand  until their expiration dates.

In the interim, should the  respective business areas need  professional consulting or auditing  services, the appointment  of service providers will be  made in accordance with our
procurement processes”.

Another internal source at  Telkom recently revealed to  Business Report that they were  very concerned about EOH’s  service offering to Telkom.

Business Report will continue  our investigation into the  matter in next few days

Adri Senekal de Wet is Executive Editor: Independent Media. Editor: Business Report & Personal Finance.

BUSINESS REPORT