Quality in everything we do!

Dion’s message to colleagues: Our number one priority - Quality in everything we do!

Dear Colleagues,

The Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud, also known as the Zondo Commission, has undertaken very important work investigating allegations of state capture, and has published its final reports. The findings provide an important point of reflection - including for corporate South Africa and firms like us. 

Our purpose is to build trust in society and solve important problems. You, our community of solvers, are the drivers to deliver on our purpose. Considering the wide ranging findings and recommendations of the Commission, including disappointing references to some of our engagements in the reports, we should pause and like many other companies, acknowledge our important role in restoring public confidence - especially in delivering work in the public sector. We are fully committed to playing this role. 

We recognise that we owe this to our people and to society in general, and we will be failing at our purpose if we don’t accept this responsibility, take accountability, and contribute towards a better and capable South Africa. The findings and recommendations by the Commission contain important lessons for us, and other private sector enterprises. At the start of the new financial year, it is important that we remember our core values and the importance of reinforcing quality in everything that we do. This includes who we choose to work with, the nature of the services we agree to undertake and ensuring that those services consistently achieve the specific expectations of clients, the prevailing expectations of the market and those of market’s stakeholders, and comply with all applicable standards and policies. It’s up to all of us to ensure that we behave in a consistent, predictable, and high quality manner, and that we remain fully committed to our core values.  In this respect, we continue to enhance our controls across all facets of our client engagement model:

Client acceptance

• We have changed our approach in respect of accepting work from all clients - including those in the public sector - and what engagements we are prepared to accept with clients. We will continue using the PwC Network’s proprietary decision support systems for client acceptance and retention (called Acceptance and Continuance (‘A&C’)); 

• In instances where the potential client or project has been identified as higher risk, we have an independent panel assessing the risk, the engagement terms and reporting requirements;

• We have enhanced procedures to identify relevant relationships, potential conflicts of interest or matters affecting our independence. These checks are performed with the assistance of a dedicated independent relationship checking team within our Risk Management team; and

• We have improved and upgraded controls on how and with whom we choose to enter into joint business relationships - having  these relationships undergo thorough scrutiny and approval by our Risk Management leadership team prior to being accepted or renewed - including enhancing our consideration of perceived independence threats.

Execution

• We have enhanced internal controls to ensure that we involve people with the requisite specialist knowledge and skill in delivering high risk and complex engagements;

• We have invested significantly in real-time assurance oversight, with dedicated individuals reviewing the work of our teams on an ongoing basis, and specifically focussing on high risk areas which could influence our audit reports (including review of Key Audit Matters);

• Similarly, in our other lines of service we have bolstered our in-flight quality reviews which are conducted by independent teams; 

• We have grown the Audit Methodology specialist back office resources team from 39 specialists in 2016 to 99 currently. These specialists are focused on providing ongoing quality assurance and support for teams delivering on audits; and

• We have enhanced the role of  the engagement quality review partner (QRP) and added the role of a QRP assistant to this important process to assist with increasing the depth of the review and challenge process.

Monitoring

• We annually update our evidence gathering activities in our engagement files. These files are updated continuously to address all inspection findings emanating from external and internal reviews. Furthermore, staff are required to undergo annual training in respect of these specific inspection findings; 

• We are proactively strengthening the quality indicator metrics, which are used to proactively monitor quality and measure and evaluate partners’ and managers’ performance; 

• Engagement compliance reviews are conducted by independent teams across all engagements from all lines of service on an annual basis; and

• We have updated our accountability framework which is used to determine financial and other sanctions for partners when they don’t meet our quality standards.

Since 1 January 2022, we are privileged to have a PwC Public Interest Body (“the PIB”) which plays an oversight role over our Assurance practice, and which comprises four high-calibre independent non-executives: Prof Mervyn King (Chairman), Zuleka Jasper, Mandla Mchunu and Dr Snowy Khoza (from 1 July 2022). The purpose of the PIB, which is a voluntary body, is to enhance stakeholder confidence in the public interest aspects of PwC, including those of significant societal interest for the firm. 

We continue to invest significantly in enhancing the quality of our work. This is our number one priority as a firm, which enables us to achieve our purpose and execute our strategy: helping organisations to build and sustain trust in their people, products, services, operations and the communities in which they operate.

As always I welcome any comments or suggestions you may have to further enhance our quality.

Good luck for the year ahead, I look forward to connecting with you in my travels now that most of the Covid-19 restrictions have been lifted.

Warm regards

Dion