Why KPMG’s Gupta woes are not over
The Companies and Intellectual Property Commission is monitoring audit firm to ensure appropriate action is taken against any errant directors
KPMG’s troubles are mounting as it appears the audit firm could be facing a damaging public rebuke by the Companies and Intellectual Property Commission, which is responsible for monitoring compliance with the Companies Act. The commission has indi-cated it is monitoring the KPMG board to see that it takes appropriately decisive action against its three directors if there is evidence they have failed to uphold their fiduciary duties. If it is dissatisfied, the commission has the power to invoke section 22 of the act relating to the prohibition of reckless trading. This allows it to issue a compliance notice requiring KPMG to cease trading. It also appears KPMG, which is being investigated by the Independent Regulatory Board for Auditors for its Gupta-related work, has failed to submit its annual financial statements to the commission. Section 33 of the act obliges companies to file a copy of their annual financial statements with the commission. Failure to do so could trigger a comp...
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