IRBA Newsletter Issue 52

Issue 52 | October-December 2020 10 INVESTIGATIONS The investigation and disciplinary matters reported in this issue are developments that took place over the eight-month period from April to November. INVESTIGATING COMMITTEE The Investigating Committee met three times during this period and referred 47 matters to the Disciplinary Advisory Committee. DISCIPLINARY ADVISORY COMMITTEE The Disciplinary Advisory Committee met twice during this period and concluded on six matters. Decisions to Charge and Matters Finalised by Consent Order Four matters were finalised by consent order. Matter 1 The respondent failed to file the client’s tax returns timeously, which resulted in penalties and interest being charged to the client by the South African Revenue Service. Furthermore, the respondent failed to regularly bill the client for work performed, and instead issued a cumulative bill on termination of services. The respondent was sentenced to a fine of R100 000, of which R75 000 has been suspended for three years, on condition that the respondent is not found guilty of improper conduct relating to work done during the period of suspension; costs amounting to R10 000 were ordered; and publication by the IRBA in general terms. Matter 2 Mr David Russel Broom, the respondent, failed to identify that sufficient appropriate audit evidence was not obtained in certain areas on an audit engagement where he was appointed as the engagement quality control reviewer. He further failed to review audit documentation relating to some significant judgments made by the engagement team. The respondent was sentenced to a fine of R200 000; no cost order; and publication by the IRBA of the respondent’s name, the findings of the investigation and the sanction imposed on them. Matter 3 The respondent was found guilty of unprofessional communication and, therefore, a breach of the Code of Professional Conduct. The respondent was sentenced to a fine of R20 000, of which R10 000 has been suspended for three years, on condition that the respondent is not found guilty of improper conduct relating to work done during the period of suspension; no cost order; and publication by the IRBA in general terms. Matter 4 Mr Patrick Joseph Smit, the respondent, failed as the auditor to respond appropriately to the fact that the financial statements of the client provided insufficient disclosures regarding additional information included in the Income Statement and the Statement of Other Comprehensive Income. The respondent was sentenced to a fine of R200 000, of which R150 000 has been suspended for three years, on condition that the respondent is not found guilty of improper conduct relating to work done during the period of suspension; no cost order; and publication by the IRBA of the respondent’s name, the findings of the investigation and the sanction imposed on them. Decisions to Charge and Matters Referred for Disciplinary Hearings Two matters were referred to the Legal Department for disciplinary hearings. Jillian Bailey Director Investigations Telephone: (087) 940-8800 E-mail: investigations@irba.co.za