The Independent Regulatory Board for Auditors has concluded the disciplinary hearing against a former KPMG auditor who worked on the books of a Gupta-linked company Linkway Trading.
The body instituted the hearing against Jacques Wessels following the release of Gupta email leaks in 2018.
Wessels, who audited Linkway financial statements for the year ended February 28, 2014, faced six charges relating to improper conduct, which included a transgression that helped the company to evade tax.
IRBA wants him to be fined a maximum fine of R200 000 per charge or have his right to practice as an auditor suspended permanently. In his mitigation submission, Wessels’ legal counsel, Advocate Azhar Bham, stated that the proposed fine was crippling, arguing that his conduct did not reflect that he was inherently dishonest.
Bham questioned why Wessels should be the only person sanctioned for the Gupta account, highlighting the role of financial intuitions.
"In all honesty….everyone failed, lawyers, accountants, banks, advisors, ministers etc.
"We were deceived collectively as a country. I submit to you that it would be unfair to single out one person," said Bham as he was addressing the panel chaired by Advocate Alan Dodson SC.
According to Bernard Agulhas, CEO of IRBA, the conclusion of Wessels' hearing is a first among a number of ongoing independent inquiries involving professionals implicated in Gupta-related acts of misconduct.
"We are very pleased that the investigation into Linkway has been the first investigation related Gupta entities that has been taken to this stage…we now await the final sanction from the committee," said Agulhas.
Wessels resigned from KPMG in September 2017, before the auditing firm could institute a disciplinary hearing against him.The auditor would escape tougher punitive measures that are being sought by the regulatory body through the amendment of the Auditing Profession Act.
The amendment is currently before Parliament and is expected to be finalised in the coming months. The amended act will not allow not auditors to resign if they are in the process of reporting an irregularity. It also also seeks to empower the minister of finance to determine the maximum amount a registered auditor can be fined if they are found guilty by an IRBA disciplinary hearing.
The maximum fine is currently set at R200 000. The independent panel is expected to deliver its ruling in 30 days.