FOOTNOTES
HILARY JOFFE: Banking sector could be most at risk of collateral damage if KPMG went under
With headlines such as "Darkness descends on KPMG", and some of the audit firm’s largest clients considering whether to fire it, the collateral damage of the KPMG saga is just beginning — and the sector most at risk could be SA’s banking sector. KPMG is joint auditor of four of SA’s big five banking groups. They already have, or should have, put full risk-mitigation plans in place in the event that KPMG goes under. The dreaded words "systemic risk" are being whispered in banking circles. The banking regulator will be checking that all the big five banks are managing the risk that one of the big four audit firms files for bankruptcy — or that the banks are forced by reputational risk, public pressure or concerns about KPMG’s competence to dispense with the firm’s services altogether.It’s now quite possible that the firm could go under, if large clients desert it, if KPMG International continues to be as invisible as it has been so far and if action isn’t taken to fix what’s wrong and...
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