ABSA parent Barclays Africa Group drops KPMG

Cape Town - Barclays Africa Group [JSE:BGA] announced on Thursday that it would be cutting ties with beleaguered firm KPMG as its joint auditors.

The company, which owns ABSA Bank, said that it told its shareholders that it would withdraw a recommendation for KMPG to be reappointed as its joint auditor for the year 2018.

This comes as the office of Auditor General Kimi Makwetu also cut ties with KPMG in light of its conduct. The resolution to reappoint KPMG was made on 15 May, almost a year ago.

“The appointment of KPMG as external auditors of BAGL will cease on completion of the statutory and regulatory audit and reporting matters relating to the 2017 financial year, which is expected to take effect by approximately 31 May 2018,” the bank said in a statement.

Barclays Africa's board initially proposed that KPMG be re-appointed as one of its external auditors for the 2018 financial year, but that it would “continue to monitor developments” relating to the auditor.

"The Board has carefully evaluated the ongoing and more recent developments and decided that it is no longer able to support the reappointment of KPMG," the bank said.

KPMG South Africa said in a separate statement that it was disappointed by, but fully accept, the decision.

"We are very proud of the work that we have performed for Barclays Africa Group over many years, and of the diligence and professionalism of the team who served them."

KPMG SA said it had made far-reaching changes over the past seven months to all aspects of the firm including governance, quality, and risk management. Work to further underpin the quality of our services and integrity of our professionals continues, it said.

"We are confident the steps we are taking to change the firm are the right steps to restore trust in KPMG, and we remain resolute in our determination to achieve this goal."

KPMG CEO in SA Nhlamu Dlomu has expressed hopes that the Auditor General’s decision to distance themselves from the firm would be a temporary one.

* SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

ZAR/USD
16.55
(+0.78)
ZAR/GBP
20.92
(+0.37)
ZAR/EUR
18.93
(+0.67)
ZAR/AUD
11.62
(+0.40)
ZAR/JPY
0.16
(+0.47)
Gold
1807.86
(-0.06)
Silver
19.25
(-0.03)
Platinum
830.00
(+0.18)
Brent Crude
43.06
(+0.42)
Palladium
1963.00
(+0.31)
All Share
56374.05
(+1.52)
Top 40
52048.69
(+1.59)
Financial 15
10697.88
(+1.61)
Industrial 25
76413.30
(+1.19)
Resource 10
54358.32
(+2.14)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 2178 votes
I am taking a hit, but should be able to recover in the next year
23% - 2784 votes
My finances have been devastated
35% - 4217 votes
It's still too early to know what the full effect will be
25% - 3022 votes
Vote