Nkonki Inc’s Sunninghill office registered for voluntary liquidation on April 26, days after the Auditor General announced an immediate termination of their contract and the firm is waiting for the Master of the High Court to appoint a liquidator, according to Masasa.
This followed revelations that former CEO Mitesh Patel, who resigned earlier in April led a management buyout of the auditing firm, funded by Gupta associate Salim Essa through Trillian Capital.
Masasa, Head of External Audit at Nkonki took over the reins and said that the executive were trying to rectify the situation by arranging to buy back the shares when the Auditor General announced the decision.
Masasa said that the current executive had their hands tied when the management buyout by Patel was being conducted as he was the majority shareholder.
“[We] read like everybody else about the allegations…eroded a lot of value created over 25 years.”
Future for auditors
Masasa, a chartered accountant who began her career at Deloitte said that she still sees a future for auditors and young people should take up the challenge to transform the image of the beleaguered profession.
“I guess there needs to be a full revamp… ethics and transparency are top of mind”.
Public sector work formed the majority of the 25-year-old company’s revenue and it could not keep its door open after the loss of the Auditor General contract.
The Independent Regulatory Board for Auditors (IRBA) has urged corporates to give black firms more business so that they are not almost entirely reliant on the state, like Nkonki Inc.
Masasa said that she hopes the landscape for black audit firms will change, after Nkonki’s closure.
Affiliated audit companies who are independent legal entities have distanced themselves from Nkonki Inc’s Sunninghill office, the largest in the Nkonki network and have not informed the Sunninghill executive about their plans, according to Masasa.