'Unlawful' KPMG South Africa under fire

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Last week KPMG announced that it had withdrawn its report on the work the audit firm did for Sars.

"While KPMG has badly let itself down in South Africa, BLSA recognises that the overwhelming bulk of KPMG's staff are committed, honourable and diligent individuals who were not implicated in "state capture" activities".

The new chief executive of KPMG in South African, Nhlamu Dlomu, described this period as "painful", noting that her firm has "fallen short of the standards we set for ourselves and that the public rightly expects from us".

Both Zuma and the Guptas deny wrongdoing and say they are victims of a politically motivated witch-hunt.

"As a measure to restore confidence in audits, all of government and its entities must consider reviewing their work programmes with KPMG, to ensure that their audit processes have not been compromised in any way, and to take appropriate steps if it has been compromised", he said.

The suspension is pending the outcome of an independent investigation into the organisation's involvement in conduct related to state capture in South Africa.

Shortly after Gigaba's statement, the National Assembly's medical-insurance plan also said it had made a decision to drop KPMG. The party runs Johannesburg, the financial center, and the capital, Pretoria, in cooperation with other smaller parties. The Guptas and their companies have not been charged with any crime. "These developments further threaten to undermine our efforts in reinforcing confidence and enhancing a climate for investments, both domestic and global", the minister said.

"If the DoJ starts to come at McKinsey for foreign corrupt practices act stuff, that's going to be a very big wake-up call for a whole bunch of people doing business in this country", Lamberti said. United Kingdom public relations firm Bell Pottinger was the first prominent victim of the scandal, filing for administration after being found to have run a racially divisive social media campaign on behalf of the Guptas.

Sanco spokesperson Jabu Mahlangu said in a statement: "Sasfin's decision to terminate its audit tender with the audit firm has demonstrated its commitment to good corporate governance and upholding the fundamentals of independent audits which characterise how South African institutions and the companies are held accountable to shareholders and investors". Gordhan was investigated by police for his role in the setup of the department, although no charges were ever brought.

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