NEWS

Wits University The Latest To Ditch Ailing KPMG

Wits University is the latest in a long line of clients to dump the embattled auditing firm.

04/10/2017 13:08 SAST | Updated 04/10/2017 15:59 SAST
Ute Grabowsky / Getty Images

The University of Witwatersrand (Wits) has resolved not to renew contracts with embattled firm KPMG once its current annual work is completed.

In a statement released on Wednesday, the university said it had taken the decision following a meeting with the current CEO of KPMG, international KPMG representatives and members of the university's council audit and risk committees.

Following "long and hard" deliberations on KPMG's presentations, the committees felt KPMG had "not gone far enough" in taking action, following devastating revelations of the firm's complicity in the now-debunked SA Revenue Service (Sars) "rogue-unit" saga, the statement said.

"The committees acknowledge that KPMG did take some actions... but it was agreed that KPMG had not been sufficiently transparent and that it is hard to reconcile [its] conclusion that no one did anything illegal when senior individuals have been dismissed and the Sars report... retracted," the university said.

In these circumstances, the council believes that it would have been prudent to acknowledge the ethical and legal lapses of KPMG's senior management team. Further, the company should have embarked on programmes to correct the wrongs that have been done to individuals and institutions. The council also believes that an independent investigation should have been initiated at the outset. Wits University

In a bombshell revelation in September, KPMG withdrew its investigation into the so-called "rogue unit of the South African Revenue Services. The explosive report was allegedly used by Sars commissioner Tom Moyane as the basis for a dismantling of the unit and departure of numerous senior staff members, including experienced forensic investigators.

READ: Tom Moyane And The Disemboweling of SARS

KPMG has since haemorrhaged clients, including Deneb Investments, Sygnia Asset Management, Sasfin bank, energy-investment company Hulisani and even Parliament's medical aid scheme. The African arm of Germany's Munich Re, like Wits, dropped the firm on Tuesday.

READ: Here's What Pravin Gordhan Had To Say About The KPMG Fiasco

According to Fin24, at least 13 other clients have been reviewing their relationship with KPMG after its reputation began to suffer a series of devastating blows, broadly linked to its work with Gupta-linked companies.

Wits said PwC would remain its external auditors.