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INVESTIGATIONS
INVESTIGATING COMMITTEE
The Investigating Committee met once during this period and
referred 28 matters to the Disciplinary Advisory Committee with
recommendations.
DISCIPLINARY ADVISORY COMMITTEE
The Disciplinary Advisory Committee met once during this period
and concluded on 13 matters.
Decisions not to charge
One matter in terms of Disciplinary Rule 3.5.1.1 – the respondent
was not guilty of improper conduct.
One matter in terms of Disciplinary Rule 3.5.1.2 – there is a
reasonable explanation for the respondent’s conduct.
Two matters in terms of Disciplinary Rule 3.5.1.4 – there are no
reasonable prospects to succeed with a charge of improper
conduct against the respondent.
One matter in terms of Disciplinary Rule 3.5.1.5 – it is not appropriate
in the circumstances to charge the respondent.
Decisions to charge and matters finalised by consent
order
Eight matters were finalised by consent order.
Matter 1
The respondent, as director in an audit firm, failed to ensure that
the annual financial statements of the firm had been prepared in
accordance with Section 30 of the Companies Act.
The respondent was sentenced to a fine of R80,000, no cost order
and publication by the IRBA in general terms.
Matter 2
The respondent, as executor of a deceased estate, failed to perform
their duties with the required degree of professional competence as
they failed to comply with the requirements of the Administration of
Estates Act. The respondent’s actions in relation to the fees charged
lacked integrity and professionalism.
The respondent was sentenced to a fine of R150,000, of which
R75,000 has been suspended for three years on condition that the
respondent is not found guilty of unprofessional conduct relating
to work done during the period of suspension, no cost order and
publication by the IRBA in general terms.
Matter 3
The respondent failed to identify that the annual financial statements
did not comply with the requirements of International Financial
Reporting Standards for Small and Medium-sized Entities, and
further failed to perform adequate audit procedures on certain
material balances and transactions. The respondent also prepared
the financial statements and in so doing contravened Section 90(2)
of the Companies Act.
The respondent was sentenced to a fine of R180,000, of which
R90,000 has been suspended for five years on condition that the
respondent is not found guilty of any offence relating to work done
during the period of suspension, no cost order and publication by
the IRBA in general terms. In addition, the respondent must arrange
and ensure that they and their audit staff attend external training
on the practical application of auditing standards within 60 days
of the imposition of the sentence and must provide evidence of
compliance to the IRBA.
Matter 4
The respondent was mandated to prepare and submit a client’s bi-
monthly VAT returns. The respondent failed to submit a VAT return
and alert the client thereof at the time. The respondent did not act
diligently in the performance of professional services to the client.
The respondent was sentenced to a fine of R40,000, of which
R20,000 has been suspended for three years on condition that the
respondent is not found guilty of unprofessional conduct relating
to work done during the period of suspension, no cost order and
publication by the IRBA in general terms.
Matter 5
The respondent signed the audit report before the annual financial
statements were approved by the trustees. The financial statements
were retracted and new financial statements were issued. The
respondent failed to extend audit procedures to the date of the new
auditor’s report.
The respondent was sentenced to a fine of R40,000, of which
R20,000 has been suspended for three years on condition that the
respondent is not found guilty of unprofessional conduct relating
to work done during the period of suspension, no cost order and
publication by the IRBA in general terms.
Matter 6
The matter was a referral from the Inspections Committee. The
respondent breached Section 90(2) of the Companies Act by
auditing financial statements that had been prepared by the audit
firm. Furthermore, the annual financial statements did not disclose
the details of the preparer of the financial statements, as required
by the Companies Act.
The respondent was sentenced to a fine of R80,000, of which
R40,000 has been suspended for three years on condition that the
respondent is not found guilty of unprofessional conduct relating
to work done during the period of suspension, no cost order and
publication by the IRBA in general terms.
Matter 7
The matter was a referral from the Inspections Committee. The
statement of cash flow for the financial year and the comparative
figures included unpaid dividends in the financing activities
disclosure. The respondent issued an inappropriate audit opinion
as the financial statements contained material misstatements.
Issue 44 | October-December 2018
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