KPMG appoints new CEO for South Africa's war-torn branch

KPMG has announced the appointment of a new director general for South Africa, where the global auditor faces a battle to save his reputation and his alleged links with political corruption.

Ignatius Sehoole, former director of the South African Institute of Chartered Accountants, will come from outside the firm to take up his post next May, KPMG said in a statement on Wednesday.

Mr. Sehoole will inherit a local operation for KPMG that was threatened last year and attempts to rehabilitate his image after several damaging scandals.

Mr. Sehoole said, "My priority at KPMG will be to continue to restore customer confidence and make KPMG a place where the best people work."

South African companies and public sector clients have massively abandoned KPMG for companies linked to the Guptas, a family-run business at the heart of the country's biggest post-apartheid corruption scandal.

The Guptas are accused of using a friendship with Jacob Zuma, the former president, to distort institutions and take control of public contracts and appointments made under his rule – claims that they deny but are reviewed by Cyril Ramaphosa , successor to Mr Zuma.

KPMG has also been criticized for its work on a report to the South African tax service allegedly used by Zuma's allies to undermine the institution.

The image of the company in South Africa was further tarnished by the collapse of VBS, a highly publicized banking fraud in political relations. KPMG's own audits on VBS were found to be compromised.

Under the leadership of his former South African director, Nhlamu Dlomu, KPMG admitted errors on all three counts and decided to reimburse the fees collected for the work related to Gupta and the tax investigation. He also referred former staff members involved in the VBS scandal to the authorities.

"While KPMG has evolved significantly over the past year, the challenges KPMG and the profession have faced have intensified," resulting in the hiring of an outside KPMG candidate, said Wiseman Nkuhlu, its South African executive chairman.