Greg Hodgson – Top Achiever: F8

Well done to Greg for succeeding as top achiever in the December exams. Keep going Greg!

What do you believe being an ACCA member will do for your career?

I believe that being an ACCA member will certainly open a lot of doors for me both locally and internationally. Having those professional letters after your name demonstrates that you not only have the requisite technical knowledge and experience, but also that you have the hard work and determination required to pass demanding professional exams.


How do you stay motivated?

I am motivated by the long, fulfilling and rewarding career that having the ACCA qualification and membership should offer, and the respect it will garner from friends, family and colleagues alike.

What words of encouragement do you have for other students?

I think that setting goals, both short-term and long-term are an important step to remaining motivated and for planning purposes. It is important to remain focused and not allow oneself to get too distracted by the many things that can sway our attention these days like social media and the internet etc.

I also like to remind myself  of the often quoted expression “Nothing worth having in life is ever easy to achieve”, in order to stay motivated.

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Learnings from investigating financial statement fraud

This article comments not only on what has happened in corporate failures elsewhere in the world but also accurately describes the circumstances of many corporate failures in South Africa.

Although little has been recorded of the fraudulent activity that contributed to or resulted in the corporate failures in South Africa, KPMG had the opportunity to be involved in a number of those investigations to a larger or lesser extent.

Although greed, ambitious corporate growth, excessive interest in maintaining stock prices, stock market expectations and weak independent directors and audit committees, were definitely a common theme, these were not the only reasons that contributed to the frauds.

Another aspect that has always come up during these investigations into corporate failures and extensive financial statement fraud is the role the financial manager played in assisting management in concealing the true nature of the fraudulent activity going on. In many of these instances, the financial manager was not even directly benefiting from the fraudulent activity. However, their evasiveness during the audit or inability to answer probing questions, even during the forensic investigations, have made it impossible or very difficult to uncover the full extent of the financial statement frauds. The response of these financial managers differ from case-to-case, but trends that emerged were the following:

  • Pride in their ability to record the transaction in such a manner that the auditors did not pick it up
  • A belief that as long as they did not answer the auditor’s question, but referred him/her to management, they were not party to the fraud or the cover up
  • A belief that they are not to question their boss and therefore have to do what he/she says they should do
  • Rationalisation of their conduct and role in the transaction, to the extent that the financial managers do not believe that they did anything wrong.
  • Only recently, in a matter ongoing now since 1999, did the financial manager finally accept that although he may have an accounting explanation for the transactions he processed, legally, he is unable to substantiate the transactions. This distinction, in the mind of the financial manager, is something that can be definitely noted in future investigations to come.

Only recently, in a matter ongoing now since 1999, did the financial manager finally accept that although he may have an accounting explanation for the transactions he processed, legally, he is unable to substantiate the transactions. This distinction, in the mind of the financial manager, is something that can be definitely noted in future investigations to come.

This article was taken from KMPG’s South African blog, to visit the blog click here 

Reflecting on SDG’s in Relation to the WEF Resolutions



World Economic Forum (WEF’s) theme for the year of “Mastering the 4th Industrial Revolution” presented some of the challenges that developing countries face, although opportunities of creating new markets, re-engineering on the existing business strategies seemed to be the focus. A shift in mind set and capacity building to support national plans stemmed up as an engine for building towards a positive socio – economic activity in the near future. The core of the conversations aligned directly and indirectly to the Paris agreement and the Sustainable Development Goals (SDG’s) of supporting responsible business practises, narrowing the gap between the developed and developing countries and “making the world a better place”.

Progress Review

As an emerging market, South Africa (SA) is currently not yielding the expected growth prospects. Progress has been uneven in whether it is in ensuring access to internet connection or in being innovative in the prevention of illnesses instead of treating diseases. Limitations to internet connectivity impede transfer of knowledge, business expansion and creation of small businesses – while the latter tends to decrease the rate of production and adversely having a ripple effect in the economic activity of the country. Entrepreneurship has been cited as the driver of change for the African economies. However, gender imparity, quality education, access to finance, data sharing, sound governance structures, bridging human capital and infrastructure gaps are the keys to unlocking the full realisation of a transformative, inclusive and sustainable economic growth path. SA has taken great strides in addressing gender equality and women empowerment in both corporate and public enterprises, but there is still some rhetoric that needs to be transformed into action. Authentic support thereof for entrepreneurship through industrialisation still needs to be re-invented.

With climate change revolutionising the way business is done, SA and Africa at large have an opportunity to turn the renewables market into a massive growth area. According to the World Bank “one investor characterized the renewable programme as the most successful public-private partnership in Africa in the last 20 years. Important lessons can be learned for both South Africa and other emerging markets contemplating investments in renewables and other critical infrastructure investments”. The role of regional infrastructure development is critical in building a continuing socio and economic development.

Like many of the developing countries SA has the world’s youngest population to train and develop in building agile and robust sustainable business and government strategies in the future.  With climate change threatening food security and exacerbating slow economic growth. The emergence of new technology, as in biotechnology can be further developed in building a resilient and sustainable agriculture. Each country has to consider the ethical issues that this new wave of technology also brings forth as it develops its policies and regulations.

Whilst the prime responsibility to deliver rests with the government, according to PwC 87% of SA businesses are aware and understand that company responsibility lies beyond profit and that its performance is interlinked to the triple bottom line. The accountancy profession has a critical role to play in supporting the building blocks of a

The Role of Fraud in the Economy


According to various reports, fraud is South Africa’s number one economic crime and considering that fraud accounts for 7% of company revenue worldwide, any further increases in this figure could prove detrimental to an organisation in these difficult economic times. In South Africa alone, it is estimated that fraud costs the economy in excess of R2 billion a year. There are a number of reasons why people fall victim to the pressures of fraud. In the economic state that we find ourselves in there is scarcity of jobs and this has resulted in people using unethical methods for financial gain. On the other hand, in an attempt to reduce costs, companies usually resort to measures like retrenching staff (which may affect the segregation of duties doctrine), reduced training, abandoning cheques and balances which may be in place, or cutting back on internal audits, amongst various other things. In such conditions, an organisation is susceptible to fraudulent behaviour from its employees both internally, as well as externally in transactions binding the firm. Ever since the 2008 downturn the relationship between the finance industry and consumers has changed. According to an ACCA report titled Culture vs regulation: what is needed to improve ethics in finance, “the crisis shattered the public’s trust in the banking system and as the examination of financial institutions continues the relationship between the bank and the public continues to deteriorate as ever more scandals are announced”. A number of policies have been drafted to aid this situation, but policies and regulations can only go so far. Regulations and policies alone will not be able to combat fraud in business. Regulation failed to prevent the 2008 crisis; risk was constantly discounted. In some instances it was considered non-existent. Technological developments and complex products can be created rapidly, which means that the regulator will always be playing “catch-up”. So maybe in highlighting the impacts of fraud on the economy and how these affect each of us directly there might be some improvements that emerge. Below are some of the impacts of fraud on the country:

  • Corrupt activity hinders development
  • Contributes to the depletion of the public purse and distorts markets
  • Hinders local and foreign direct investment.

Countless studies around the world show how corruption can interrupt investment, restrict trade, reduce economic growth and distort the facts and figures associated with government expenditure. But the most alarming studies are the ones directly linking corruption in certain countries to increasing levels of poverty and income inequality. The issue of ethics comes to play, and these are determined by the culture of an organisation. The ACCA report looks at the culture of tolerance in an organisation, for instance, is profit valued more than the means. Does an organisation promote a culture of high risk overlooking regulations and policies? It is important that business managers realise that these “insignificant” hints lay foundations to bad or good behaviour. Over-reliance on regulators has been found wanting in days of old when dealing with fraud and corruption, it is therefore important that business managers understand that the most power lies in the culture of the organisation and they have the most influence on this than external regulators.

Working Mothers in the Workplace


There are a lot of expectations in the corporate world for anyone trying to find success, women in the workplace though have a little more to juggle.

A recent survey conducted by, showed that a staggering 69% of South African companies are not going to be hiring working mothers, even though our country’s Labour Law protects working moms against such acts of discrimination. “Working mothers are less committed. Working mothers are far less flexible. Working mothers’ skills are outdated and working mothers are going to take maternity leave as soon as you hire them!” these are some of the reasons given as to why they avoid hiring working moms.

The South African Labour Law has taken great strides in protecting women in the workplace. For instance, the law states that pregnant job seekers are under no obligation to inform potential employers of their condition. In fact, legislation does not even stipulate at what time or when an employer needs to be notified of the pregnancy. What’s more, the Labour Relations Act of 1995, classifies that a dismissal of an employee due to a pregnancy, an intended pregnancy, or a reason which relates to pregnancy, as being automatically unfair.

In the ACCA report titled Gender diversity to boost business performance, Sheena Ganesh, Finance Controller at Shell Petroleum, says ‘I have found that…female executives hesitate discussing flexible working, long maternity leave and sabbatical options for fear of losing position, being side-tracked for promotions, etc. It takes tremendous confidence in one’s own worth and the courage to speak up.’ Deducting from Ganesh’s statement it is obvious that education on rights of working moms needs to be done. highlights the following from the Basic Condition of Employment Act for women saying, the conditions of maternity leave are:

  •  A woman is granted at least four consecutive months of maternity leave and maternity leave can commence at any time from four weeks before the expected date of birth, unless mutually agreed by both employer and employee, or on a date that a medical practitioner or a midwife has deemed necessary;
  • A mother is not allowed to work for six weeks after the birth of her child, unless a medical practitioner or midwife certifies that she is fit to;
  • Any woman who has suffered a miscarriage during the third trimester of pregnancy or bears a stillborn child is entitled to maternity leave for six weeks after the miscarriage or stillbirth, whether or not she had begun maternity leave at the time of the miscarriage or stillbirth;
  • Payment of maternity benefits are determined according to the provisions of the Unemployment Insurance Act, there are some companies, however who offer paid maternity leave to their employees. If this is the case, a worker is not able to claim UIF (unless a portion of her salary is not covered by her employer).

It is crucial for women to know the rights that are in place to protect them. It is also crucial for a shift in the mind-set of business to take place in relation to working mothers in the workplace. The option to work closer to home, flexible working hours, near-site crèche facilities and job sharing are some of the measures that companies can do in embracing working mothers in the workplace.

Women Work for Free for Four Months of the Year

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While research shows that complete gender equality, with the efforts being put in now, will only be possible in 2095, the gender pay gap will only be totally bridged in 50 years.

Despite the benefits of gender equality released through research results yearly, the gender pay gap has widened over the years. In South Africa the gap between males and females is standing at 35%. This means that females get in a year what males get in eight months – meaning women work for free for four months as opposed to their male peers.

There are several factors that contribute to this gap widening. The ACCA report, gender diversity to boost business performance, highlights the lack of commitment from companies to gender equality. This one barrier is by far the most contributor. “Women with a degree earn on average 30% less than their male peers with similar levels of education, whereas the gap is lower for those with a basic or high-school education”, says Sandra Burmeister, CEO of the Landelahni Recruitment Group. In the past the pay gap was attributed to differences in skills and the experience women brought to the labour market; research shows that women that have the similar skills and the same qualifications still earn less than their male peers.

The pay gap seems to widen with age. The WageIndicator survey indicates that women under 25 years the gender pay gap is 15%. Between the ages of 25 and 34 years, it widens to 19%. This widening trend accelerates in the middle-age group (35-50 years) to reach 25%. Finally, during the later years of their working career, the earnings gap widens at a slower rate, with women over 50 experiencing a pay gap of 27%.

According to the World Economic Forum, closing the male-female employment gap would have huge economic benefits, boosting GDP by as much as 16%. By drawing on the full complement of available talent at all levels of the organisation, particularly in top leadership teams, companies have been shown to produce better financial results, particularly as opportunities grow in the knowledge economy. It makes sound business sense for pay inequality and job barriers for women to be removed.

There is an influx of females entering the finance profession; approximately half of ACCA students are female. The growing numbers of women accountants and their ever growing influence is perhaps most keenly evident among ACCA students and members in Singapore, where a staggering 75% are estimated to be female. It is imperative that this team entering the field finds the ground cultivated, females have proven their ambition and their ability to produce profitable results as much as their male peers. It is only fair that they get the same remuneration.

If research results have proven the link between women participation and improved financial performance then this gap is not just an issue of compliance, but it has become a moral issue that needs to be looked into and amended quickly.