A copy of the correspondence from the Chief Executive Officer of IRBA, Bernard Agulhas, to David Maynier MP, DA Shadow Minister of Finance, can be found here
We welcome the decision by the Chief Executive Officer of the Independent Regulatory Board of Auditors (IRBA), Bernard Agulhas, to extend the scope of the investigation into KPMG South Africa to include the conduct of the auditor responsible for the forensic investigation into the SARS “Rogue Unit”.
We requested the investigation following a determination that the forensic audit into the SARS “Rogue Unit”, conducted by KPMG South Africa, and which was finalised on 04 December 2015, was signed off by a registered auditor, and could therefore be investigated by IRBA.
We received a reply from IRBA to the request to extend the scope of the investigation into KPMG South Africa on 06 October 2017, which reads as follows:
“We hereby confirm that the Independent Regulatory Board for Auditors (IRBA) will be extending the scope of the investigation to include the conduct of the auditor responsible for producing the forensic SARS “Report on Allegations of Irregularities and Misconduct”.
If the auditor, who was responsible for the forensic investigation into the SARS “Rogue Unit”, is charged and found guilty, he could receive a caution or reprimand, incur a fine of up to R200 000 per charge, be suspended from practice for a specified period, or he could be removed from the register, which would effectively terminate his career in the auditing profession, forever.
We hope that, given the public interest in this matter, this investigation will also be fast-tracked by IRBA.
In the end, auditing firms such as KPMG South Africa, which allegedly not only turned a blind eye, but also supplied the corporate grease to lubricate the wheels of state capture, tax evasion and corruption, must be held to account in South Africa.
DA formally request IRBA to extend the scope of its investigation into KPMG SA
We welcome the fact that the Chief Executive Officer of the Independent Regulatory Board for Auditors (IRBA), Bernard Agulhas, has decided to “fast track” the investigation into KPMG South Africa.
However, the fact that KPMG South Africa has reportedly failed to fully cooperate with the investigation, as they promised to do in their mea culpa on or about 15 September 2017, is a major concern.
We also welcome the fact that it has been determined that the forensic audit into the so-called SARS “Rogue Unit”, conducted by KPMG South Africa, and was finalised on 04 December 2015, was in fact signed off by a registered auditor, and is therefore a matter that falls within the mandate of IRBA.
I have, therefore, written to the Chief Executive Officer of IRBA, Bernard Agulhas, formally requesting him to extend the scope of the investigation to include the conduct of the auditor responsible for forensic audit into the so-called SARS “Rogue Unit”.
It’s time for SCOF to step up and scrutinise SARS’ handling of the SARS “rogue unit”
South African Revenue Service commissioner, Tom Moyane, has notified the Standing Committee on Finance of his “dissatisfaction” with KPMG International’s handling of the controversy surrounding the SARS “rogue unit”.
SARS’ investigative review culminated in KPMG South Africa producing a forensic audit report entitled “Report on Allegations of Irregularities and Misconduct”, dated 04 December 2015, parts of which were subsequently repudiated by KPMG International.
The commissioner seems to want the committee to scrutinise KPMG International’s handling of the controversy surrounding the SARS “rogue unit”, when the committee should, in fact, be scrutinising SARS’ handling of the controversy surrounding the SARS “rogue unit”.
I have, therefore, written to the Chairperson of the Standing Committee on Finance, Yunus Carrim, requesting him to schedule hearings to scrutinise SARS’ investigative review of the so-called SARS “rogue unit”.
To properly scrutinise SARS’ investigative review of the SARS “rogue unit”, it is imperative that the committee be granted access to a number of documents, prior to the hearing commencing, including:
- a copy of the final report, entitled “Report on Allegations of Irregularities and Misconduct”, dated 04 December 2015, received by SARS;
- a copy of the draft report, entitled “Report on Allegations of Irregularities and Misconduct”, dated 03 September 2015, received by SARS;
- copies of any other drafts of the report, entitled “Report on Allegations of Irregularities and Misconduct”, dated before 03 September 2015, received by SARS;
- a copy of the Service Level Agreement between SARS and KPMG South Africa;
- copies of all communication between SARS and KPMG South Africa on the mandate extension to include conclusions, recommendations and legal opinions, referred to in KPMG International’s press statement dated 15 September 2017; and
- copies of all communication between (a) SARS and KPMG South Africa and (b) SARS and KPMG International relating to KPMG South Africa’s investigative review of the SARS “rogue unit”.
It’s time for the Standing Committee on Finance to step up and fulfil its constitutional obligation to scrutinise the controversy surrounding the SARS “rogue unit”, which it has failed to do for years in Parliament.