Sasfin Holdings, a South African banking and financial services group, has dropped KPMG as its auditor after 18 years citing ‘well-publicised concerns,’ as the firm faces criticism over its audit work for the Gupta family and a separate report it produced for the South African Revenue Service
Johannesburg Stock Exchange listed company, Sasfin, announced on 19 September that it will remove KPMG as its auditor as well as changing its independent sponsor from KPMG Services, which handles Sasfin’s stock exchange announcements, to Deloitte & Touche Sponsor Services.
Sasfin said its decision was made to ‘ensure a separation of the role of external joint auditor to the Sasfins Holdings Limited Group with that of independent sponsor’.
Sasfin said: ‘In view of the well-publicised concerns recently raised with regard to KPMG as well as Sasfin’s commitment to good governance in respect of auditor independence and auditor tenure, Sasfin has decided to put its audit out to tender.’
KPMG and Grant Thornton Johannesburg Partnership have been joint auditors of Sasfin for 18 and 30 years’ respectively.
An audit tender process is expected to begin in November 2017.
On 15 September 2017, chief executive of KPMG’s South African arm, Trevor Hoole, resigned with the firm’s chairman, chief operating officer and five senior partners also departing following an internal investigation into the work the firm carried out on behalf of the Gupta family and a report it produced for the South African Revenue Service.
KPMG said: ‘While the investigation did not identify any evidence of illegal behaviour or corruption by KPMG partners or staff, this investigation did find work that fell considerably short of KPMG’s standards.
‘Based on the results of this investigation, significant actions have been taken (…) with respect to KPMG South Africa. These actions include a series of leadership changes, changes in the governance of KPMG South Africa, and enhanced quality control procedures in certain areas.’
