Lack of black auditors holds SA up - Mbeki
September 25, 2005
By Sherilee Bridge
Johannesburg - A chronic shortage of black chartered accountants (CAs) could hold South Africa back, President Thabo Mbeki said on Friday, so there was an urgent need to increase the number of black accountants.
Writing online in ANC Today, Mbeki said more accountants were needed not only to transform the accounting profession but to help fight "the pervasive cancer of corruption".
Of the 23 493 qualified CAs in the country, only 543 are black Africans, and only 178 are black women.
And, according to figures from the SA Institute of Chartered Accountants (Saica) for June, out of a total of 9 332 accounting trainees, only 1 491 were black; of these, 689 were women.
Ignatius Sehoole, Saica's executive president, says the country is unable to produce enough accountancy professionals to cater for the growing economy. Whites make up 89 percent, and black accountants are virtually guaranteed a job the day they qualify.
Between 1976 - when Wiseman Nkuhlu became South Africa's first black CA - and 2001 black CAs only rose to about 6 percent of the total. Since then the proportion has risen by about 1 percentage point a year.
Transformation pressure has forced audit firms to see it as a business issue. An empowerment charter is being crafted for the profession.
Mbeki said he was encouraged by the work Saica was doing on the critical issue of skills development, but while he did mention the Thuthuka Project and the Nkuhlu Subvention Fund, the president said he was disappointed by the low level of private sector funding.
The Thuthuka Project, which includes the Thuthuka bursary fund, is an initiative of Saica, the Association for the Advancement of Black Accountants of Southern Africa (Abasa) and the Public Accountants and Auditors Board.
The Nkuhlu Subvention Fund, which aims to increase the standard of accountancy, was launched last year by Abasa and has raised R2.3 million from the private sector.
"Both these projects need maximum support," Mbeki said. He added that training targets should factor in the brain drain, caused by the attraction of higher earnings, and the fact that "a significant number of CAs" take up seats such as chief executives and chief financial officers.
Accountants had a difficult and important task, he said, and "should be among the frontline forces engaged in struggle against corruption".
The ANC, the government and the people of South Africa were "deeply concerned", the president wrote, about graft in the public and private sectors, which "directly undermines the critically important effort to defeat poverty and underdevelopment".
The government is working on the Auditing Profession Bill, which seeks to enhance the independence of auditors while ensuring that auditors are held accountable for their conduct.
And Sehoole told Finance Week: "As a profession we have to invest heavily over the next five years in re-establishing public confidence."
In a survey released on Thursday by global accounting firm KPMG, 6 percent of the 386 organisations consulted in 13 sub-Saharan African countries said they had lost $170 000 (R1 million) or more to fraud in the past year.
Of the South African respondents, 68 percent thought fraud would rise.
As Mbeki put it: "Accountants are required in part because shareholders know that they can't trust firms; there is simply too strong an incentive, even in the presence of fraud laws, to provide misleading information."
|
|
