CAPE TOWN - Minister of Finance, Malusi Gigaba should allocate all work done by auditing firm KPMG to government departments, by black-owned small and medium-sized auditing firms, with a preference to women-owned firms, according to the Progressive Professionals Forum (PPF), reports Fin24.
This comes after an international investigation was launched to probe the South African unit of KPMG. KPMG then retracted parts of its report into the SA Revenue Service (SARS) intelligence unit, which was dubbed the “rogue unit”.
Gigaba responded to this in an announcement last week by saying that all government departments must review their work with KPMG. The PPF welcomes the above statement by Gigaba and voiced their concerns.
"The current debacle by KPMG with SARS indicates that other auditing firms may also be involved in unethical practises and their reports may lack the necessary and expected credibility," said the PPF's deputy secretary general Zinhle Cele.
The PPF subsequently took action by calling for an independent inquiry into the work of KPMG for government and state-owned enterprises (SOEs) dating back to 1994.
"PPF reiterates its call on all progressive professionals in the private and public institutions to exercise procurement spend to be biased towards the black-owned small and medium auditing firms," said Cele.
The PPF wants to overturn this debacle into a platform which will uplift the disenfranchised black-owned and small and medium auditing firms. In addition, the PPF calls for all government and state-owned enterprises (SOE's) to cease all work with KPMG.
Companies such as JSE-listed Deneb Investments, Sygnia Asset Management, Sasfin bank and energy investment company Hulisani have already answered to the PPF's request by dropping KPMG. Similarly, embattled KPMG needs a miracle to survive in South Africa, according to economist Iraj Abedian, of Pan-African Capital Holdings, reported Independent Media on September 24.
This comment follows the governments call on all work done by KPMG to be reviewed. Gigaba confessed that the current scandal has damaged the reputation of the industry as a whole.
Added to that, it is mainly a few firms which dominate the market, said Gigaba. This ties in with the PPF's call for smaller companies to get their seat at the auditing table.
- BUSINESS REPORT ONLINE