State Capture - why auditors and accountants should take a political stand
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State Capture - why auditors and accountants should take a political stand
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Auditors don't often align themselves with political positions.
We often choose not to be politically affiliated for professional and personal reasons.
However, we cannot deny that we have a role to play in politics. We often don't realise the impact of politics on the accounting and audit professions.
I can't believe it sometimes, but two years have passed since the release of the state capture report by Chief Justice Raymond Zondo.
For those who need a reminder: There was an investigation through a commission of inquiry into allegations of corruption and 'capture' of the South African state.
The reports also implicated some of our fellow SAICA (South African Institute of Chartered Accountants)members in their role in the alleged state capture.
SAICA CEO Freeman Nomvalo addressed the matter at the time:
"The chartered accountancy profession is undergoing a period of profound reflection encompassing debates on how to maintain professional independence as evidenced by SAICA's recent revisions to the Institute's by-laws which include enhancements to the disciplinary process.
We can all agree that adherence to the highest standards of ethical conduct, professional integrity and avoidance of conflict of interest must remain the bedrock of the accountancy profession."
SAICA expects all its members to uphold these values in all professional circumstances.
If you want to read more details about our profession and the ethical standards we uphold, please look at the SAICA website.
We have a role in the public sector, often driven by the political needs at the time. This ensures accountability and reporting within the prescripts of both PFMA (Public Financial Management Act No. 1 of 1999)and MFMA (Municipal Financial Management Act No. 56 of 2003) and other legislation governing the sector.
Implicating some senior management and executives, This often put auditors in a tight spot.
Amongst other contributions, we must prevent the re-occurrence of state capture by applying all the necessary professional duties to the stakeholders we interact with.
SAICA has prescribed a code of professional conduct that public and private practice accountants should adhere to.
Here are the values we are supposed to keep dear to us:
Integrity
Objectivity
Professional Competence and Due Care
Confidentiality
Professional Behaviour
It is without dispute that some of the SAICA members were implicated in the state of capture report. Let's highlight one implicated member, former SAA (South African Airways) director Yakhe Kwinana.
After the revelation, SAICA announced the immediate withdrawal of Kwinana's membership, a decision taken after a disciplinary hearing.
SAICA's disciplinary committee said Kwinana "was not a fit and proper individual to be a member of the profession", according to a statement.
Amongst other allegations, the report noted evidence that the former chartered accountant personally received R4.3 million in payments from a South African Airways Technical (SAAT) supplier.
It is reasonable to conclude that Kwinana should have applied the SAICA code of professional conduct. If she did, she would not accept the alleged payments and should have reported this issue to the relevant authorities.