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01 August 2023 | Story Kekeletso Takang | Photo Supplied
Business Acumen Day 2023
The UFS School of Accountancy hosted a panel discussion in the Centenary Complex with the topic ‘The audit profession’s response to the financial reporting scandals of the past decade: Has enough been done?’. Panellists included Prof Bernard Agulhas, Rob Rose, and Patricia Stock, and the session was facilitated by Prof Philippe Burger and Conrad de Wee.


Auditing firms in South Africa should go back to basics and emphasise accountability in revamped corporate structures to avoid repeats of the big auditing scandals of the past decade such as the Steinhoff, VBS, Tongaat Hulett, and Bosasa scandals. This was some of the opinion expressed during a panel discussion hosted by the University of the Free State (UFS) School of Accountancy and featuring auditing and accountancy experts. 

The discussion tackled the topic ‘The audit profession’s response to the financial reporting scandals of the past decade: Has enough been done?’, and featured a panel of experts including Rob Rose, Financial Mail Editor and author of Steinheist; Prof Bernard Agulhas, former CEO of the Independent Regulatory Board for Auditors (IRBA) and current Adjunct Professor of Auditing at the UFS; and Patricia Stock, audit partner and CEO of MGI RAS and former South African Institute of Chartered Accountants (SAICA) board member. 

The event took place on 19 July 2023 in the Centenary Complex on the UFS Bloemfontein Campus. It was facilitated by Prof Philippe Burger, Dean of the Faculty of Economic and Management Sciences, and Conrad de Wee, Chairman of the SAICA Central Region Council and Senior Manager at auditing firm Mazars.

Prof Agulhas said a lot has been done to prevent a repeat of the root causes of the financial reporting scandals of the past decade. “Everyone has responded. The profession, regulators, universities, labour markets, the public, and professional bodies.” Still, he said a lot more needs to be done. “We have to go back to basics. Look at the framework, ISA standards, skills, and competencies. Professionals must be adaptable and responsive. Firms must set the tone at the top and create a conducive environment. Establish a culture of accountability. We have to go back to behavioural competencies. Universities can also investigate the inclusion of forensic auditing as part of the curriculum.” 

The panel felt that accountability is central to going back to basics. Rose said he believes businesses need to change their organisational cultures. “The likes of Glencore and Tiger Brands are making an immense effort to revamp. There are numerous ways companies can go about it, including setting the tone at the top and establishing accountability structures in-house. Also, not only having fraud-detection systems, but also implementing them.”

He also questioned why no one is holding bankers accountable for failing to uncover recent corporate scandals. “In the case of Tongaat Hulett, how did they miss all the issues through their risk assessment? At the end of the day, they should also be held accountable.”

Where it all went south

Prof Burger said the World Economic Forum had for seven years, until 2017, rated South Africa number one for the strength of auditing and reporting standards. “And then we started to see things go wrong, with the likes of state capture, Steinhoff, VBS, and others. In light of this, has enough been done to equip external auditors to deal with fraud in organisations, and to ensure that they act in the interest of the public?” 

Prof Agulhas, speaking from his experience as a regulator, said, “Initially, South Africa was one of the few developing countries to adopt international standards. For seven years, we have received a good rating from the World Economic Forum. But if we can be honest, while our professional qualifications are among the best in the world, we were not that good at implementing these standards due to behavioural issues on the part of certain accountancy/ auditing professionals.” 

Stock, sharing her perspective as an audit practitioner, commented: “We are noticing a growing trend among firms to improve on reporting, and audit committees are holding professionals accountable. While this is said, we should also acknowledge that there is a need to look at the whole ecosystem relating to financial reporting.”

Auditing in the era of artificial intelligence

When questioned about the impact of technological advances on auditors, Stock said she believes artificial intelligence and technology integration offer the auditing profession a wonderful opportunity. She stressed that technology will not replace human capital. “We need critical thinkers and value creators. Technology won’t replace that, especially where Environmental, Social, and Corporate Governance (ESG) is concerned.” 

Interaction between universities and industry

Prof Burger posed the question, “When looking at the interaction between universities, industry, and trainees, would you say this model is still fit for purpose, and are these individuals ready?”

Stock responded, “The profession needs the diversity of minds. We need their enquiring minds. We need to hear the voices of our trainees. In fact, one of the scandals of the past decade was picked up by a trainee, but was unfortunately ignored by the more senior staff.” 

Where we are now

The panel discussion was attended by stakeholders from the School of Accountancy, which included managers and directors of various auditing and accounting firms, representatives of professional bodies, members of management from large businesses, and university staff members. Interactive polls and the opportunity to submit questions allowed guests to participate in the discussion, which ended with a consensus that while much effort has been made to restore the credibility of the auditing profession, there is still further work to be done. 

The panel discussion was made possible with the financial support of Standard Bank.

News Archive

CR Swart Memorial Lecture: Mr Cecil le Fleur
2006-08-08

Khoe and San call for government to speed up policy dialogue with indigenous communities  

 Mr Cecil le Fleur, leader of the National Khoe-San Consultative Conference and member of the executive management of the National Khoe-San Council, has called for a national policy on indigenous peoples to protect the human rights and special needs of indigenous people in South Africa.

 Mr Le Fleur delivered the 38th CR Swart Memorial Lecture on the Khoe and San at the University of the Free State (UFS).  He commended the UFS for its serious approach to the Khoe and San and for initiating initiatives such as a research project on the Griqua in which various aspects linked to language, -culture, -history, - leadership, their role in the South African community (past and present) and the conservation of their historical cultural heritages will be covered.   

 “The policy dialogue with indigenous communities initiated by government in 1999 and supported by the International Labour Organisation (ILO), has been exceedingly slow, owing to political and bureaucratic problems,” said Mr Le Fleur.

 According to Mr Le Fleur the slow pace is also impacting negatively on the United Nations’ efforts to expand the international standards and mechanisms for human rights so as to include the special needs of indigenous peoples.

 “The successful adoption of a South African policy would probably have a major impact on the human rights culture of Africa and, more specifically, on the UN system,” he said.

 “South Africa has a powerful moral authority internationally and is willing to use this authority in multilateral forums. At this stage, however, South Africa’s Department of Foreign Affairs (DFA) may not take an official position on UN instruments and declarations pertaining to indigenous issues, until the Cabinet has resolved its own domestic policy position,” he said. 

 According to Mr le Fleur it therefore came as a great surprise when the DFA brought out a positive vote in the UN for the adoption of the "Draft Declaration on the Rights of indigenous Peoples" in June this year, even before the completion of the policy process. 

 Policy consolidation in South Africa is the primary key to creating a new policy climate in Africa in order to protect the rights of indigenous peoples.  “The existing constitution of the Republic of South Africa is one of the most liberal on the continent, and embraces the concept of redress of past discrimination.  It already includes a clause (Section 6) making provision for the protection of language rights for Khoe and San peoples - the fist peoples of southern Africa,” he said. 

 “If South Africa can effectively integrate this ‘third generation’ of collective rights within an existing democratic constitution, this will send a clear message to Africa and the world that indigenous rights are a necessary component of human and civil rights in modern democracies,” he said.

 Mr Le Fleur proposed an institutional framework based on set principles that would satisfy the needs and aspirations of the Griqua and other first indigenous peoples in South Africa.  “The proposed framework was based on the notion of vulnerability as a result of colonialism and apartheid, which stripped us of our indigenous identity, cultural identity and pride as people.  This injustice can hardly be addressed within the existing mechanisms provided by the current text of the Constitution,” he said.

 Mr Le Fleur also proposed that the principles of unique first-nation status, as recognised in international law, should be applied in the construction of the framework of the constitutional accommodation for the Khoe and San. 

 Mr Le Fleur further proposed that the Khoe and San’s indigenous status in constitutional terms must be separate from the constitutional acknowledgement of their status as a cultural community, as envisaged in sections 185 and 186 of the Constitution of 1996.

 According to Mr Le Fleur, the suggested mechanism should make provision for structures such as:

  •  A statutory representative council for First Indigenous Peoples of South Africa at a national level;
  • a separate Joint Standing Committee on Indigenous and Traditional Affairs, in both the National Assembly and the National Council of Provinces on which the Khoe and San can be represented;
  • a representative structure for the Khoe and San in the legislature of each relevant province; and
  • ex officio membership in the relevant structures of local government.

Media release
Issued by: Lacea Loader
Media Representative
Tel:   (051) 401-2584
Cell:  083 645 2454
E-mail:  loaderl.stg@mail.uovs.ac.za 
24 August 2006


- Full lecture
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