EDITORIAL: Safeguarding auditors is crucial for clean local government
There is a famous saying, often attributed to the late US banker Sam Fleming, which succinctly sums up the role of auditors: “In God we trust; everyone else we audit.” Without credible auditors verifying the numbers, there would be no reason to trust the financial statements dished up by companies, government departments or any other institutions dealing with shareholder, taxpayer and donor money. When auditors fail to fulfil their role — obtaining reasonable assurance that the financial results paint an accurate picture of the state of an organisation’s finances — the repercussions can be dire. Recent high-profile examples in SA include the collapse of VBS Mutual Bank, where KPMG signed off on materially false financial statements, and Steinhoff, where auditors failed to pick up accounting irregularities, with the subsequent slide in the share price costing investors about R200bn. While internal auditors are there to ensure that systems and processes are in place to accurately reco...
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