• Register
Return to: Home > News > IRBA: 17% of JSE-listed companies rotate auditors in advance of MAFR

IRBA: 17% of JSE-listed companies rotate auditors in advance of MAFR

Roughly 17% of Johannesburg Stock Exchange (JSE) main board listed companies have already voluntarily rotated auditors—four years early from the effective date of Mandatory Audit Firm Rotation (MAFR), according to the South African Independent Regulatory Board for Auditors (IRBA).

The 64 companies that have rotated in the past two years will not need to do so again until 2027 or 2028. The remaining companies whose audit firms have tenure of ten years or more on 1 April 2023 must rotate prior to that date.

In 2018, 35 companies changed their auditors in early compliance, with nine in the first few months of 2019.

IRBA CEO Bernard Agulhas said: “This is extremely encouraging as at this pace, we can expect that by the end of this year over 120 companies or a third of main board entities will have complied and have ‘a fresh pair of eyes scrutinising their financial statements.” 

In 2018, 33% of companies cited MAFR for the change to audit firms, with results rising to 38% in 2019. The second-most cited reason was terminations of relationship.

Agulhas continued: “To assist committees in comparing audit quality during a selection process, the IRBA has also begun a first phase process to test a set of Audit Quality Indicators (AQIs) with a number of JSE-listed accredited audit firms.”

“Although companies haven’t specified MAFR for being the reason for rotating earlier, the effective date may have been a factor.”

The IRBA warned for audit committees not to select new auditors on price alone without considering quality, necessary competence and experience for the nature of the work, as few have experience running an audit tender process.

Agulhas concluded: “by addressing any long association between the auditor and the client, the company would have gone a long way in securing reliable and credible audit opinions.”

 

By Asena Degirmenci

Top Content

    HONG KONG NATIONALS: UNDERSTANDING VISA AND TAX WHEN MOVING TO THE UK

    Over 2 million Hong Kongers learned recently that they may soon be offered a route to UK citizenship following China’s introduction at the end of June of its controversial Security Law in the territory.

    read more

    SASB IMPLEMENTATION SERIES: COMMUNICATING ESG TO MAINSTREAM INVESTORS

    As part of a series of webinars, the Sustainability Accounting Standards Board (SASB) took a closer look at how to communicate ESG initiatives and progress to mainstream investors

    read more

    REPORTING AND COMPLIANCE: WHY WE NEED A DATA REVOLUTION

    Commerce no longer adheres to national boundaries: the largest international organisations to the smallest businesses operate in a global market. However, rules for corporate reporting and compliance do adhere to borders, write IMA’s Jeff Thomson and Liv A Watson

    read more

    CORONAVIRUS TIMELINE: REACTIONS FROM THE ACCOUNTANCY PROFESSION

    As the Coronavirus (COVID-19) continues to spread across the world, the International Accounting Bulletin and The Accountant will be collating all the latest news and updates from the profession on the pandemic’s impact.

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.