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EVALUATING INDEPENDENCE IN LIGHT OF THE COMPANIES ACT, No 71 OF 2008
by Lourika Els - Tuesday, 18 September 2012, 08:45 AM
 

The need to be independent from our clients is such a fundamental concept for the assurance community, but in the South African context can be challenging to achieve. 

The skills shortage in the bookkeeping  and management accounting spheres result in clients not always having the technical knowledge and ability necessary to manage the finances of their businesses, leading  management to lean heavily on their accountants and auditors for assistance and guidance.  

In practice, that same practitioner is often called on to assess and audit the work they assisted with, a direct threat to their independence.  In light of the Companies Act, No 71 of 2008, we accountants really need to evaluate our independence, both in fact and perception, which can be a painful exercise. 

The fact that 62% of our Professional Code of Conduct deals with independence and the recent senior legal counsel  opinion given to IRBA and SAICA on S90(2), illustrates that this is an issue we need to pay urgent and thoughtful attention to.

Prof. Caryn Maitland (Editor-in-Chief of eCPD Accountancy)

 


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