KPMG fingered in what could be the biggest accounting scandal in the history of Botswana

KPMG has been accused in another auditing scandal in the Southern African country; Botswana

According to reports by Botswana paper Sunday Standard, the audit and advisory firm KPMG may not only have some explaining to do for its conduct in South Africa.

The article says liquidator of Kingdom Bank Africa (KBAL), John Little has “accused KPMG Botswana of misconduct in signing off the books of the bank which collapsed two years ago and has filed a lawsuit of close to $19.3 million against the accounting and auditing firm on behalf of creditors”.

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KBAL was reportedly liquidated in 2015 due to insolvency after an audit assigned by Bank of Botswana uncovered the apparent 19.3million dollars “mismatch between assets and liabilities”.

Little has accused KPMG of covering up the bank’s solvency problems since 2010, incorrectly signing them off as a going concern. The paper reported that the matter, if Little is correct, could turn out to be the “biggest accounting scandal in the history of Botswana”.

“In the premises, in conducting the audit for the year ended 31 December 2013 and in conducting the audits for the prior years, KPMG Botswana acted negligently and accordingly breached the terms of its contract with KBAL,”  says Little.

He also alleged that KPMG had failed in its duty to report the true financial situation of KBAL to management, which ultimately meant steps could allegedly not be taken in time to rectify the bank’s declining financial situation.