REGULATION
Banks have to thread the needle of joint auditors and rotation
SA’s banking regulator is sticking to the requirement that big banks must have two external auditors, despite concerns that the crisis at KPMG could result in the "big four" audit firms being reduced to a "big three". This might leave big banks struggling to hire joint auditors while they also comply with new rules on mandatory audit firm rotation. "We like joint audits for big, systemically important banks. We think it gives us a higher level of quality assurance," Reserve Bank deputy governor Kuben Naidoo said on Tuesday at the release of the annual report of the bank supervision department. The report was the last from the department, which has been absorbed into the Prudential Authority created by SA’s new twin peaks legislation. However, Naidoo acknowledged that the joint audit requirement, combined with the new requirement for mandatory audit firm rotation, which the Independent Regulatory Board for Auditors has introduced from 2023, posed challenges for the banks. His departm...
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