IRBA Issues Monetary Fine Guideline for Improper Conduct

Posted 13 August 2025 Written by Acts Online
Category Auditing

Brought to you by SA Accounting Academy: The Independent Regulatory Board for Auditors (IRBA) has released a new framework for determining monetary fines for Registered Auditors (RAs) and Registered Candidate Auditors (RCAs) found guilty of improper conduct.

In terms of section 51(1) and section 51B(3) of the Auditing Profession Act, No. 26 of 2005, the IRBA has published the Guideline for the IRBA’s Enforcement/Disciplinary Committee in determining for Registered Auditors/Registered Candidate Auditors found guilty of improper conduct. This guideline applies specifically to instances where the Enforcement Committee (ENCOM) or the Disciplinary Committee (DISCOM) has determined that a monetary fine is the appropriate sanction for improper conduct.

The guideline provides a framework to ensure transparency, consistency, and proportionality. It operates in conjunction with the maximum fine limits gazetted by the Minister of Finance on 6 June 2024 in Government Gazette Notice 4933. While the Minister sets the maximum limits, ENCOM and DISCOM retain sole discretionary power to scale fines based on the specific nature and gravity of the conduct in each matter.

Key Considerations and Framework

The committees will take into account various factors when determining the quantum of a fine, though the guideline notes that the list of considerations is not exhaustive. The primary objectives of the framework include:

  • Enforcing compliance with the legislative framework governing the auditing profession;
  • Promoting public trust in the regulation of the profession; and
  • Deterring RAs and RCAs from committing similar acts of improper conduct.

The ENCOM and DISCOM reserve the right to ascribe relative weight to different considerations on a case-by-case basis to ensure that sanctions remain fair and reasonable under the prevailing circumstances.

Click here to download the IRBA Monetary Fine Guideline.

What this means for you, your business, or your clients

  • For yourself: As a Registered Auditor or Candidate, you must familiarize yourself with the specific aggravating and mitigating factors outlined in the guideline, as these will directly influence the financial severity of any disciplinary outcome.
  • For your business: Audit firms should update their compliance and risk management frameworks to reflect the IRBA’s transparent approach to sanctioning, ensuring that internal controls are robust enough to prevent conduct that could trigger maximum fine thresholds.
  • For your clients: Clients should be aware that the regulatory environment for auditors has become more structured, with a clear emphasis on proportionality and deterrence, which serves to protect the integrity of financial reporting and audit outcomes.

Originally published at https://accountingacademy.co.za/news/read/irba-monetary-fine-guideline

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