Accounting body aims to make example out of Khaya Sithole
The South African Institute of Chartered Accountants (Saica) has come out fighting against one of its own, a former financial accounting lecturer at Wits University and a columnist of Business Day, Khaya Sithole.
Sithole’s disciplinary hearing, which started on Friday, is among the first of its kind to be open to the public as part of Saica’s efforts to enhance transparency in the profession.
The hearing comes as the reputations of the audit and accounting professions have been seriously tarnished by, among others, KPMG’s work for Gupta family companies and the actions of former Eskom chief financial officer Anoj Singh.
Singh is also facing a Saica disciplinary hearing.
Sithole had been dishonest and severely mismanaged the Thuthuka Bursary Fund while project manager of the fund at Wits University from 2014 to 2016, counsel for the institute argued on Friday.
The fund is a private sector-funded scholarship scheme for black and coloured students from poor families who wish to study accounting.
The Thuthuka Bursary Fund has produced more than 1,000 chartered accountants.
Sithole is charged with fabricating a letter from the fund’s project director, Nthato Selebi, which he then fraudulently issued to 129 Wits accounting students, falsely claiming they had been awarded Thuthuka bursaries.
The fund had to find more than R10.7m to fund these students so that Sithole’s conduct would not prejudice them, Saica said.
In a 27-page affidavit, Sithole denies fabricating a letter or forging Selebi’s signature.
But he admits that he amended the dates and details of a "one-off" letter, which Selebi sent to him in January 2014, and issued this to subsequent groups of Thuthuka beneficiaries.
"The fact that this is completely wrong is indisputable," Sithole wrote in an 11-page letter to then Saica CEO Terence Nombembe in December 2016 in which he admits that he "screwed up — spectacularly".
However, he contends that Wits University’s financial aid office and the head of the school of accounting, Prof Nirupa Padia, were aware that the letter was being used to register subsequent groups of students.
Sithole claims Padia repeatedly imposed students on the Thuthuka programme — including foreign nationals who by definition were excluded — with no separate letter to facilitate their clearance.
"Rejecting them had become pointless as, historically, whenever I rejected students they would go to Padia, who would then instruct me to accept them anyway," Sithole said in his affidavit.
It "makes no sense for Selebi to completely ignore Padia’s role in the process and simply limit his accusations to me", Sithole said. "At no point in time did I [set out] to defraud this whole thing," Sithole told Business Day on Sunday.
He said the bulk of the 129 students were in any event due to receive funding from BankSeta.
He had raised the funding at the end of 2015.
Padia did not respond to e-mailed questions and could not be reached on her phone.
A date for the continuation of the disciplinary hearing is yet to be announced.