Section 110.1 A1 of the SAICA Code of Professional Conduct, read with subsection R113.2 Professional Competency and Due Care, requires a professional accountant to take reasonable steps to ensure that those working in a professional capacity under the professional accountant’s authority have received appropriate training and are properly supervised.
IT IS IMPORTANT FOR CHARTERED ACCOUNTANTS to ensure that staff members working in their firms and/or under their authority have received appropriate training and possess the skills required to ensure that a client or engaging organisation receives competent professional service based on current technical and professional standards and relevant legislation. Furthermore, staff members must act diligently and in accordance with applicable technical and professional standards when executing their professional duties.
Diligence, in terms of section 113.1 A4 of the Code of Professional Conduct, encompasses the responsibility to act in accordance with the requirements of an assignment, carefully, thoroughly and on a timely basis. Chartered accountants must ensure appropriate supervision of staff members by adequately and regularly checking their work to ensure that they act in accordance with the requirements of an assignment, carefully, thoroughly and on a timely basis.
A chartered accountant who fails to train and supervise staff members working in their professional capacity may be found to be in contravention of the SAICA Bylaws and the SAICA Code of Professional Conduct should the work performed by staff members be found to be substandard. This may result in disciplinary action being taken against the chartered accountant through the Professional Conduct Committee (PCC) or the Disciplinary Committee (DC), depending on the seriousness of the allegations against them.
The PCC previously dealt with a case of this nature where staff members working under the authority of a chartered accountant failed to properly complete annual financial statements. Crucial information had been omitted, which resulted in the client suffering financial loss. The PCC imposed the following sanction:
- A reprimand.
- A fine of R50 000 of which R35 000 was suspended for a period of three years on the condition that the respondent does not commit and/or be found guilty of the same or similar conduct from the date of the PCC meeting and the respondent must provide SAICA with proof, within 60 days of being notified of the outcome, that he had upskilled himself and his team on the issue that resulted to the inaccuracy of the annual financial statement so as to avoid a reoccurrence. The unsuspended part of R50 000 (R15 000) was to be paid within 30 days of being notified of the outcome.
- The matter to be published on the SAICA website, via member communications and/or in Accountancy SA magazine together with his name and a brief description of the offence and penalty imposed. A fit and proper enquiry was not necessary herein.
SAICA recommends that chartered accountants ensure that those working in a professional capacity under the professional accountant’s authority have appropriate training and adequate supervision as prescribed in the SAICA Code of Professional Conduct.
Authors
Blessing Malope, Manager: Member Discipline, and Mulisa Mathavha, Manager: Legal and Discipline
The general business community often argues that the government’s compliance requirements are onerous, time-consuming, and a distraction from growth and innovation. This is especially true for small and medium-sized enterprises (SMEs), which are disproportionately affected because they lack the administrative capacity and networks of larger corporations. For SMEs, ‘compliance’ isn’t just a box-ticking exercise − it’s a potential death knell.
Let me give you an example. Assisting a local car wash owner to apply for a basic funding opportunity recently turned into a multi-day logistical operation: sourcing certified documents, going to the municipality for proof of address, and finding someone with a scanner to help upload documents for the CIPC submission and then drafting a business plan with a five-year cashflow projection. What seems like a one-hour digital task to some of us can mean several days of taxi rides and missed income for a small business owner in Tshiawelo or Butterworth.
And while this example may feel like an edge case, the problem persists − and intensifies − even further
up the value chain.
In the last five years, my team and I have assessed numerous tenders across private companies, government and state-owned entities (SOEs), primarily in professional services. We estimate that in nearly 75% of those tenders, the technical requirements are disproportionately exclusionary to smaller firms. Specifications appear designed not just to ensure capability − which is fair − but also to systematically eliminate newer and more agile players from even qualifying to compete.
Let me be clear: these are not just administrative barriers. They are structural filters that effectively lock out skilled professionals simply because they don’t carry the badges of incumbency − 15 years of experience in a single narrow sector, 10-year company registration histories, five transactions above a specific financial threshold, and so on.
We recently saw a tender requiring references from prior clients − nothing unusual there. However, each reference had to provide a detailed score out of 100 for the work delivered, without any framework or scoring rubric. What does that even mean in practice? Are we now expecting our clients to moonlight as rating agencies?
Another recent requirement specified that firms applying for infrastructure panel work must employ team members with at least 15 years of experience in project finance. No rationale was provided. What if you have a team of 10 people, each with 10 years of high-quality experience across multiple sectors? That doesn’t count. Ironically, the same tender required sector-specific experience in, say, agriculture − punishing teams that have diversified and learned across industries.
Let’s contextualise this absurdity: Elon Musk sold his first tech company for $300 million within four years of graduating from university. Enough said.
One of the most startling requirements I’ve encountered was during a tender briefing session where it was stated that the applicant company must have been registered for at least 10 years − purely for ‘reputational purposes’. Someone rightly pointed out that a shelf company registered a decade ago now qualifies, while a thriving business built from the ground up eight years ago does not.
These are not isolated quirks. They are symptoms of a system that has been quietly rigged. In fact, in a recent discussion with an international colleague, it was revealed that one of their associates was involved in drafting the tender specifications − for a local transmission tender, the result of which is that no local company qualifies for the R400-billion tender. It’s hard not to question the fairness of that playing field.
In theory, BEE is supposed to level the field for historically disadvantaged individuals. In practice, many of the biggest firms already boast Level 1 BEE status, crowding out smaller black-owned businesses who are still climbing the ladder.
This isn’t just a black business issue − it’s a small business issue. But when viewed through the lens of transformation, the challenge becomes even more stark. We are asking black entrepreneurs, many without generational wealth, to start at the bottom, take on the smallest contracts, and slowly build track records over a decade or more. Only once they have ticked all the boxes − 15 years of experience, 10 years of company registration, and sector-specific expertise − will they qualify to bid for the kind of work that isn’t even that substantial in value. Some of these tenders are for less than R1million in fees.
By then, most have either pivoted, sold, or shut down.
To be clear, this is not about lowering the bar or awarding tenders to unqualified players. It’s about designing tender criteria that measure what matters − capacity, capability, and innovation − not just tenure and legacy relationships.
I’ve raised these concerns with senior government officials who often acknowledge the problem. However, they’re quick to point out that the levers of change sit much lower in the system, within procurement teams and committees overwhelmed by competing priorities. When I asked about Sipho Nkosi’s red tape reduction initiative, the response was that while his mandate is noble, it spans all levels of government and may never reach this level of granularity.
In countries like the United States, fresh ideas and bold new thinking are valued more than age or tenure. Young people are empowered to fail, learn, and build again.
That’s how you build an innovative economy.
In South Africa, we’ve built a tendering system that filters out that same energy before it even arrives …
Author
Itani Mafune CA(SA), ACMA, CGMA
