Parliament, Parmed Cut Ties With KPMG

Picture: REUTERS

By Romio Ndove

The Deputy Speaker of the National Assembly, Lechesa Tsenoli, confirmed that Parmed have terminated the contract with KPMG after allegations of corruption emerged against the auditing firm.

Parmed is a medical aid scheme for Members of Parliament in both the NA and the National Council of Provinces, Members of Provincial Legislatures and Judges,

This comes after the South African Revenue Services (Sars) pushed for legal action against KPM.  The auditing firm announced that it intended to withdraw its report on a probe into the existence of a “rogue spy unit” within the Sars, while it said work done for the controversial Gupta family “fell considerably short of KPMG’s standards”

The Parmed board, under chairman Tsenoli, NA Deputy Speaker, took a unanimous decision to end its contract with auditing firm KPMG, Parliament said on Wednesday.

The decision was taken at a meeting held in Cape Town last week.  

“Commenting after the meeting, Mr Tsenoli said the Board had made the decision after considering the risks associated with doing business with KPMG after its recent admission of improper conduct that seriously tarnished the company’s reputation,” Parliament said.

“With regard to another contract KPMG has with Parliament, which is aimed at reviewing the effectiveness of the Parliamentary Service, both parties are in discussion around the immediate termination of the contract.” 

KPMG South Africa has since appointed Nhlamu Dlomu as its new chief executive following the resignation of the top leadership of the company, including chief executive Trevor Hoole, chairman Ahmed Jaffer, chief operating officer Steven Louw and five other senior partners, while it said it was pursuing disciplinary action seeking the dismissal of Jacques Wessels, the lead partner on the audits of the non-listed Gupta entities.

KPMG further said it would donate the R40 million it earned in fees from Gupta-controlled firms to charity and refund the R23 million from the controversial Sars report.