BREAKING: Auditor General Terminates KPMG, Nkonki Contracts

PICTURE: Business Day

JOHANNESBURG: The Auditor General of South Africa on Tuesday terminated contracts with embattled auditing firms KPMG and Nkonki.

The two embattled audit firms did work for the office of the Auditor General on public sector contracts.

In a statement on Tuesday, Auditor General Kimi Makwetu says issues around the two firms have been concerning and pose significant risk to the reputation of his office.

Makwetu stressed the terminations are not a judgement of the capabilities of individuals at the firm.

He also said, “recent media reports relating to the external audit of VBS Mutual Bank and the conduct of KPMG audit partners are some of the reasons that prompted the decision to withdraw all KPMG audit mandates with immediate effect.” 

“On the termination of Nkonki Inc.’s contract, Makwetu said recent media reports on matters arising from the shareholder transactions involving the firm were of “grave concern and pose significant risk on the reputation of my office through the statutory audits contracted” to Nkonki Inc.”
According to Business Analyst, Khaya Sithole, “it has become inevitable for the Auditor-General to terminate the mandate of Nkonki and KPMG. The Auditor-General does not want to be associated with firms that have clouds hanging over their heads.”
“As South Africa’s supreme audit institution, this country looks up to us to act and project an image of accountability, the same way we hold the entire public sector to account on how it uses taxpayers’ monies,” Makwetu said.
This is one of the tenets that have anchored this organisation for over 100 years, and we encourage all our employees and contracted audit firms to conduct themselves in a manner that will not erode this long-standing legacy,” he added.