5 minute read
To Comply or not to comply...
by kwedamedia
" To be or not to be? That is the question - Whether ’tis nobler in the mind to suffer the slings and arrows of outrageous fortune, or to take arms against a sea of troubles, and, by opposing, end them?
The famous question from Shakespeare’s Hamlet was perhaps best explained by former Israeli prime minister Golda Meir, who sharply retorted: “This is not a compromise — either you be, or you don’t be.”
If only it was always that simple. In a profession that will soon be challenged — or probably already is — by the dreaded artificial intelligence (AI), accountants and auditors must by necessity take up arms and defend their raison d’être; unlike Hamlet, our choices are more limited - not only must we remain future-fit, but also restore the former glory and esteem that the profession held prior to the recent audit failures.
Within this context, what is the profession’s “X factor”? What will distinguish it from AI, rendering it fit for purpose in the future, as well as credible after the audit lapses of the past? For a start, the ability to think for oneself must surely eclipse the ability to script programmes to do so. Behavioural competencies such as critical and analytical thinking, scepticism and being independent, therefore, remain the exclusive domain of human beings (at least for now).
This, unfortunately, doesn’t mean that human beings themselves are not open to being programmed — and the auditing profession is no different. If we repeatedly do something for sufficiently long periods, and we believe that we can justify our behaviour, it is not difficult to get lulled into a false sense of what we believe is “the right thing to do”. The problem is that not everyone has a consistent understanding of what this is and leaving it to our souls to guide us might be putting too much faith in humankind.
Not all is lost, however; our laws and regulations save the day. South Africa has world-class legislation - such as the Public
Finance Management Act and the Companies Act – which is derived from a world-class constitution. These are more than just guidelines; they provide us with much-needed direction in navigating our way through a complex, tricky, unethical and often corrupt environment. They even prescribe consequences, should we depart from such direction, mostly to create a culture of compliance and, ultimately, accountability.
A culture of compliance should not be underestimated in a world where corruption and misconduct are the order of the day. But it should not be confused with the belief that “ticking the boxes” absolves us of responsibility.
We still have to apply those unique skills of critical and analytical thinking, judgment and professional scepticism, and we still have to demonstrate our ethical behaviour. Without doing so, we reduce ourselves to mere chatbots (not to be derogatory of the value added by AI to our lives and our profession).
A culture of compliance should also not be fostered only in response to the fear of being caught. As the great Albert Einstein once asserted, those who do good solely out of fear of punishment — or at the prospect of rewards — are “a sorry lot indeed”. A fearbased culture often obscures the necessary voice of reason, where interpretation is, in fact, necessary.
Respect for the law
We no longer live in a world that is black or white; that is too easy. Our complex environment requires us, as professionals from whom society has great expectations, to apply our training and consistently demonstrate appropriate behaviour. Our moral compass requires continuous recalibration.
It has become too easy to discard our laws and regulations, claiming they inhibit performance and productivity. Take the parastatals Transnet, Eskom and the SABC as examples where the primary legislation designed to hold public servants to account has been subverted by exemptions to compliance. These, inevitably, reduce transparency, accountability and much-needed consequences for noncompliance.
That’s not to say every requirement in every law applies to every entity — but let’s not throw out the baby with the bathwater. As true professionals and public servants, we can honour our social contract to act in the public interest by deferring to our laws, standards and codes even if we don’t do so slavishly (we are not chatbots).
Accountants and auditors, as well as those in leadership positions, fulfil a critical role in doing what is right by the public. They shine a light on wrongdoing — and they should be doing so rather than seeking avenues to justify poor governance and non-compliance. Leaders and the profession should not find themselves having to hide anything, lest they be forced to utter those dreaded last words of Hamlet: “The rest is silence.”
* Agulhas is the former audit regulator and an adjunct professor in auditing at the University of the Free State; Church is a lecturer in auditing and corporate governance at the University of the Free State.
(This article first appeared in the September 2023 issue of Financial Mail)
