The South African Institute of Chartered Accountants (SAICA) has announced it will fund an independent inquiry into the alleged misconduct of certain members of SAICA employed by KPMG South Africa.
The inquiry was originally announced on 22 September following allegations of misconducts at KPMG in the audit of Linkway Trading.
SAICA CEO Terence Nombembe said: “This inquiry will not be conducted by SAICA, but by an independent retired Judge or Senior Counsel. Furthermore, the inquiry will not contradict, interfere, obstruct, undermine, water down or downplay the investigation being carried out by the Independent Regulatory Board for Auditors (IRBA).”
Prior to this announcement, South Africa’s audit regulator IRBA had released a statement warning that SAICA had no legal mandate to lead independent inquiries.
“We confirm that SAICA, as the member body, does not have the legal mandate to lead independent inquiries into the conduct of audit firms, and further confirm that the IRBA will follow its due process in terms of its founding legislation, to draw the investigation to its rightful conclusion as quickly as possible,” IRBA’s statement read. “We call on the market to respect the IRBA’s due process, as required by its legislation, and allow it to run its proper course.”
On 12 October Nombembe announced that the independent inquiry chairman was finalising the term of reference including timelines, the methodology and the regulations that will guide the panel’s process. And that the chairman was finalising the composition of the independent inquiry panel.
“As the future announcements around this matter will be made by the Chairman of the Independent Inquiry, SAICA will not make further comment in this regard,” Nombembe said.