Published: Sun, May 06, 2018
Arts&Culture | By Antoinette Montgomery

Barclays Becomes First Major Bank To Ditch KPMG South Africa

Barclays Becomes First Major Bank To Ditch KPMG South Africa

On Friday, Auditor General Kimi Makwetu told Fin24 whether KPMG will ever be allowed to do business with the office of the AG will depend largely on the outcome of investigations into the private auditing firm and whether its leaders can eradicate poor adherence to auditing disciplines.

The tipping point in the case of KPMG was the revelation that two auditors involved in the audit of VBS Mutual Bank, which is under curatorship, had been extended loans by the bank.

The board of Barclays had initially recommended the reappointment of KPMG as one of its external auditors for 2018, to be considered at its annual general meeting (AGM) on May 15.

Chairperson of Parliament's Standing Committee on the Auditor-General Vincent Smith says Nkonki Inc should be barred from doing any work paid for with taxpayers' money until it reveals its shareholders.

This follows a decision by Barclays Africa, one of KPMG's major financial customers and South Africa's second-biggest lender by market value, to join more than 10 other clients, including the government and broker Sasfin, to break ties with KPMG since 2017.

Auditor General Kimi Makwetu
Barclays Becomes First Major Bank To Ditch KPMG South Africa

- Ordinary Resolution 1.2 which is withdrawn relates to the re-appointment of KPMG as external auditors.

In September, Barclays Africa indicated it would be retaining KPMG as an auditor, but would continue to monitor developments due to the numerous controversies faced by the auditing company.

The two firms would complete the outstanding audit work for the financial year ending March 31 2018, though the auditor-general's office would supervise the work and undertake quality assurance.

Employees pass a logo outside the headquarters of Absa Bank Ltd, operated by Barclays Plc, in Johannesburg, South Africa, on Thursday, Dec. 12, 2013. The property group reportedly added that it would begin with a tender process in order to appoint auditors to replace KPMG.

Said Redefine CEO Andrew Konig: "Redefine's reputation is everything and our decision was made for this reason". In the meantime EY will be the sole auditors of BAGL.

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