Offices of KPMG in Johannesburg
JOHANNESBURG – KPMG South Africa anticipates up to 400 people leaving the company due to the closing of certain regional offices, as part of the "reshaping" of its business and strengthening of "leadership capacity", it said in a statement on Monday.
"These changes follow a strategic review of the firm’s activities and take into account recent client losses and current levels of demand for certain services. They are the latest in a series of initiatives announced by the firm in recent months to support its drive to restore KPMG’s strength in South Africa," the scandal-hit auditing firm said.
Two KPMG partners resigned after facing disciplinary charges over failure to disclose financial interests in connection to VBS Mutual Bank, which was placed under curatorship.
A number of high-profile clients ditched the firm in the wake of the scandals.
"We plan for the business to operate in future out of four hubs in Johannesburg, Cape Town, Durban and Port Elizabeth," KPMG said.
"KPMG in South Africa will remain a business of significant scale with more than 130 partners and 2,200 employees, supported by the breadth and depth of skills and experience of the international network of KPMG of 200,000 people. It will continue to offer a wide range of the core services that our global, regional and local clients require."
"The leadership changes will involve embedding in the firm for an extended period a number of senior KPMG partners from across the international network into board and executive positions, as well as senior client service roles. This is to further strengthen the leadership capacity available to the South African firm as it navigates the current challenges it faces, implements the enhanced internal procedures to which it has committed, and continues to serve our significant client base to the highest levels of quality."
According to KPMB South Africa CEO Nhlamulo Dlomu these decisions were hard by necessary to "put the firm on a more sustainable footing, while ensuring we continue to offer our clients the best service and support. We are putting quality and integrity at the heart of the business and, from now on, the firm will be focused on doing fewer things better. I am confident that we have taken the right steps to reform and reshape the business. Now we need time for these to take hold."
The company said it regretted the loss of loyal employees and promised to take "all possible steps to ensure these changes are managed in a caring manner and that everyone is treated with dignity."
- Additional reporting by Reuters