Tough times for auditors
Publish date: 21 December 2006
Issue Number: 44
Diary: Legalbrief Forensic
Category: Regulation
The Executive President of the SA Institute of Chartered Accountants, Ignatius Sehoole, has warned that the new provision in the Auditing Profession Act that requires auditors to report corporate irregularities to the regulatory authority was extremely onerous for auditors and was placing them on a collision course with their clients.
While auditors are taking the new law seriously, commerce and industry still do not have a good understanding of the auditors obligation to report irregularities such as theft and fraud to the Independent Regulatory Board of Auditors, says a report in Business Day. Auditors who fail to report an irregularity risk a 10-year jail sentence. Among the several concerns about the Act to have reached us is that many clients of the audit firms believe that the auditor is applying an indiscriminate big stick but under the act, the auditor had no option but to report irregularities, Sehoole said. Full Business Day report
