Trustco parts way with auditors after 20 years – cites in-house policy and conflicting regulatory oversight
Citing their own in-house audit policy plus complicated compliance issues as a listed entity, Trustco Group Holdings announced this week that their long-standing auditors, BDO Namibia had no alternative but to step back. BDO Namibia officially resigned as the group’s auditors on 20 November 2020.
BDO was first appointed as the auditors of the Trustco subsidiary, Legal Shield, in 2000. “The healthy engagement between the entrepreneurial mindset of Trustco and the independent audit mindset of BDO Namibia worked together and produced unmodified and high quality audited financial statements for Trustco and its subsidiaries,” Trustco said in a statement announcing the resignation.
In the first BDO audit, Trustco posted revenues of N$4 million, a profit of N$172,000 and N$2.6 million in assets. With BDO’s final audit for Trustco this year, Trustco has grown to over N$660 million a year in profits, and N$6.2 billion in assets.
Some two years ago Trustco introduced an auditors rotation policy based on a 10-year cycle. In the meantime, the group had to adapt to the stringent audit requirements of listed entities after the group’s listing on the Johannesburg Securities Exchange in South Africa.
Recently, the group was at loggerheads with the JSE compliance department over certain transactions between Trustco’s main shareholder, Dr Quinton van Rooyen, and the group at large. The JSE viewed these transactions as not complying with so-called IFRS (International Financial Reporting Standards) that are applied to and expected of all entities listed on Africa’s largest bourse.
This has led to a firm instruction from the JSE that Trustco must align its auditing practices and standards to IFRS.
“BDO Namibia was an excellent audit partner, forward looking and ethical, whilst retaining their independence,” the group stated.
Trustco Group Holdings Ltd Chief Executive, Dr Quinton van Rooyen.
