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KPMG's South Africa bosses purged over Gupta scandal


Heads are rolling at KPMG South Africa upon the completion of an internal investigation into the firm's business dealings with the Guptas.

"With respect to the audits of the Gupta entities, it is evident from the investigation that the audit work in certain instances, including Linkway Trading Pty Ltd, fell well short of the quality expected, and that the audit teams failed to apply sufficient professional scepticism and to comply fully with auditing standards", KPMG said in its statement.

"This has been a painful period and the firm has fallen short of the standards we set for ourselves, and that the public rightly expects from us", said Nhlamu Dlomu, who has been promoted internally to succeed Hoole.

KPMG South Africa confirmed it was the largest number of partners to ever leave the division at once related to a single incident, although it was unclear at time of publication if this was the case for the company as a whole.

"I want to apologise to the public, our people and clients for the failings that have been identified by the investigation". The agency's alleged role was to stir up anger about "white monopoly capital" and "economic apartheid" to draw attention away from the wealthy Gupta family, who have been accused of benefiting financially from their links to President Jacob Zuma.

Five other partners are also leaving the firm, and KPMG is.

"In addition to the R23m fee for the SARS report referred to above, KPMG South Africa will also make a donation of R40m into education and anti-corruption not for profit organisations".

Both Zuma and the Guptas deny wrongdoing and say they are victims of a politically motivated witch-hunt. Wessels did not answer a call to his mobile phone seeking comment.

"We were only the doers‚" KPMG SA interim chief operating officer Andrew Cranston said in a briefing on Friday.

Brothers Ajay, Atul and Rajesh Gupta have interests in computer, mining, media, travel, energy and technology and employ around 10,000 people through their company Sahara Group.

On Tuesday, the British arm of Bell Pottinger folded after clients deserted it because of a backlash over a racially charged political campaign it had run for the Guptas.

The audit company made a spectacular admission in this regard, saying the findings, recommendations and conclusion sections of its SARS report should be discarded as they overstepped the scope of KPMG SA's initial mandate - in particular, the part of the report which said that former finance minister Pravin Gordhan should have known about or been aware of a so-called "rogue unit" at SARS.

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