South Africa’s board of the Independent Regulatory Board for Auditors (IRBA) has appointed Imre Nagy as its new CEO.

Nagy has been acting CEO since February 2021. Prior to this he was the director of inspections.

Nagy took over the leadership of the IRBA in an acting role after then Minister of Finance, Tito Mboweni, dissolved the board and put in place a caretaker board.  At that time, Nagy was viewed as a sound choice with a deep knowledge of the profession and the regulatory environment.

The Auditing Profession Act Amendment was in its final stages of the parliamentary process. The amendment act was promulgated on 1 April 2021, setting out provisions for a board structure that would assure the public of increased independence.

This left the way clear for the Minister to appoint a new board in terms of the provisions of the amended act.  In June 2021, the Minister concluded on the successful appointment of a new 10-member board and since then it has been stable and effective in its functioning. One of the board’s first tasks was the appointment of a permanent CEO. 

The board prioritised selection around a candidate that had the necessary independence, no conflicts of interest and a solid understanding of the profession and the regulatory environment. While transformation was an important goal, it was not the only consideration.

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Board chair Fulvio Tonelli said: “While the process has taken longer than initially envisaged, we have had to acknowledge that we could not overlook the importance of ensuring that we avoid past mistakes with this appointment.

“We are pleased to confirm that following a robust recruitment process, the board has resolved to appoint Imre Nagy as the new CEO.  During the intervening 18-month period, Imre has served the IRBA well, earning a clean audit for 2022, and overseeing the process changes arising out of the amended act. He has also operationalised the IRBA’s refocused five-year strategy which seeks to restore confidence in the audit profession and the regulator, enhance audit quality of auditors, ensure the sustainability and relevance of the regulator, and undertake comprehensive stakeholder engagement to collectively strengthen the financial reporting eco-system.

 “Under Imre’s leadership, the IRBA has enjoyed a stable period and new projects to restore confidence in the profession have been identified and are progressing well.  Now, as the organisation moves forward, it is ready to take a collective approach to co-creating solutions to address gaps in the financial reporting eco-system that impact on audit quality. We have full confidence in Imre’s ability to do so. I extend my gratitude to him for his leadership commitment during these past months and wish him well in his new role as CEO.”

Commenting on his appointment Nagy said: “My focus over the last year has been on internal processes to support our refocused five-year strategy, and our restoring confidence initiatives, through which I aim to restore confidence and trust in the regulator and the auditing profession, with the support of a strong and dedicated executive team. We have finalised our roadmap and project charter to guide the related activities, which include strengthening our regulatory capacity and making our profession more attractive. Three workstreams have been established, and research and consultations are ongoing to identify key reforms and improvements in each of the focus areas identified.

“I believe that all role-players, within and outside the profession, want our registered auditors to demonstrate strong ethical principles; and this includes executing sustainable and consistently high-quality audits that are anchored by strong ethics, governance and regulation. I want to ensure that auditors take their rightful place as trusted professionals that promote the sustainability and growth of the economy through the public interest work that they do. If we work together and collectively focus on rebuilding our profession, we can reclaim the trust that has been lost and re-establish the value of the audit.

“I would like to thank the board for its guidance and leadership and for their confidence in me. I aim to continue to pursue the IRBA’s strategic objectives with dedication.”