Mazars confirmed as Steinhoff International Group Auditor
Following a general meeting in Amsterdam, shareholders at Steinhoff International have confirmed Mazars to be the new Group Auditor as a replacement for Big Four accounting and advisory firm Deloitte. The appointment of Mazars received support from more than 99% of the shareholders.
The news follows from a proposal made by the Steinhoff board in September to replace Deloitte, primarily in order to generate some distance from the accounting scandal that broke out at the South African retail giant two years ago. Deloitte was the Group Auditor at the time of the scandal, and substantial financial discrepancies have since been confirmed at the firm.
The scandal caused considerable damage to Steinhoff’s operations, striking 85% of its market value and knocking it off its perch at the top of South Africa’s retail landscape. The firm was forced to terminate relations with senior officials and bring in industry experts to support with a restructuring process.
Two years on, as Steinhoff continues its restructuring operations, the firm deemed a move away from Deloitte as central to its efforts to restore its reputation. Accounting and advisory firm Mazars’ Dutch outfit was proposed by the board in September as a suitable replacement for Deloitte, a move that has now been met with overwhelming approval.
The Dutch team is set to work with the Steinhoff operation in South Africa as well, in addition to its other practices in the UK and France. The move comes on the back of a lengthy PwC investigation into Steinhoff’s accounts, which revealed fraudulent accounts of more than $7 billion.
As the retailer looks forward, the management ranks appear to be in favour of the new auditors. Deloitte, meanwhile, is one of many major consulting firms currently struggling with a loss of business in South Africa. A strong of financial scandals has implicated big names in the country, including KPMG, McKinsey & Company and Bain & Company.
The scenario has raised many questions about the auditing profession in South Africa, and the issues that have contributed to high risk and vulnerability. Mazars, meanwhile, appears to be growing and capitalising on the trust deficit that other accounting firms are suffering from.
