By our reporter
Audit firm KPMG has suffered another ugly slap on the face after its South African franchise partners got involved in indiscipline cases. KPMG South Africa on Saturday announced that two of its partners had resigned with immediate effect after they were faced with disciplinary charges.
The resignations by Sipho Malaba and Dumi Tshuma were tendered on Friday.
“Their resignations have been accepted‚” the company said.
“Both cases are disciplinary charges‚ connected to VBS bank and include‚ but are not limited to‚ failure by the partners to comply with the firm’s policies and procedures regarding the disclosure of relevant financial interests‚” said KPMG. “When VBS bank recently went into curatorship‚ information arose in relation to these partners that prompted KPMG to launch an independent investigation‚ conducted by Bowmans. That investigation is ongoing and further action will be taken as appropriate.” revealed KPMG.
The South African Reserve Bank in March placed small lender VBS under curatorship because of liquidity issues.
According to Moneyweb, a South African business news site, KPMG said when VBS went into curatorship, information arose in relation to the partners that prompted the firm to launch an independent investigation. The investigation was ongoing and further action would be taken as appropriate, it said.
“This has been a very disappointing episode for KPMG. There can be no tolerance, however, of any conduct that compromises our reputation and we have moved decisively to deal with the situation,” KPMG South Africa chief executive Nhlamulo Dlomu said.
KPMG did not provide further details. It is one of several international companies facing questions about its work for the Gupta brothers, who have been accused of using their links with former President Jacob Zuma to secure lucrative tenders.
The Guptas and Zuma have denied any wrongdoing, and the accusations are part of judicial inquiry into “state capture”.
A number of companies have said they would drop KPMG as their auditor.
Back here, the same controversial KPMG was recently among the audit firms shortlisted by the Auditor General John Muwanga to investigate Bank of Uganda operations which led to the fraudulent takeover of Crane Bank.
However, it was revealed that the audit firm did not qualify for the job due to conflict of interest having been clients of Bank of Uganda.