The High Court in Kampala has dismissed an application by Dei Industries International Ltd and its proprietor, Dr Matthias Magoola, seeking to stop an independent audit into their long-running loan dispute with Equity Bank Uganda Ltd and Equity Bank Kenya Ltd.
The decision means the court-ordered audit process will continue, paving the way for the main commercial case to proceed to hearing on 13 November 2026.
In a ruling delivered by Justice Susan Abinyo, the court found that Dei Industries had failed to provide sufficient evidence to prove that the audit process had been compromised or that the institution overseeing it lacked independence.
The dispute stems from a case filed on 2 August 2024, when Dei Industries International Ltd, Dei Biopharma Ltd and Dr Magoola sued Equity Bank Uganda and Equity Bank Kenya over several loan facilities and current accounts.
The companies claim that the banks mishandled their loan accounts during restructuring and consolidation processes, resulting in disputed balances. They want the court to determine the actual amounts owed, if any, and order the reversal of funds they allege were unlawfully deducted from their accounts.
They also sought orders stopping the banks from taking loan recovery measures until the dispute is resolved.
How the audit dispute arose
As part of efforts to establish the correct financial position of the accounts, the parties initially agreed to have KPMG conduct an independent audit. The arrangement was approved by the court in December 2024, and KPMG later completed the exercise and submitted its report.
However, disagreements later emerged over the audit process, leading Dei Industries and Dr Magoola to successfully challenge KPMG’s appointment.
The court then directed the Institute of Certified Public Accountants of Uganda (ICPAU) to nominate another independent auditor.
ICPAU appointed Clayton & Company of Jinja, which developed terms of reference, collected documents from both sides and prepared an audit report that was filed before court.
Before the report could be considered, Dei Industries and Dr Magoola filed another application challenging ICPAU’s involvement. They argued that the institute’s independence had been compromised and requested that its role in the audit process be cancelled. They also sought permission to amend their original court documents.
Court rejects objections
Equity Bank opposed the application, arguing that the key issue in the case is establishing the actual amounts outstanding under the disputed loan facilities. The bank maintained that an independent audit was necessary to resolve the conflicting claims.
Justice Abinyo dismissed the challenge, ruling that ICPAU had followed the court’s instructions by independently appointing Clayton & Company without requiring approval from either party.
The judge also rejected objections against an affidavit filed by Equity Bank Uganda’s Head of Legal, Elizabeth Nayiga, ruling that she was qualified to provide information obtained in the course of her official duties.
The court found no evidence showing that ICPAU had failed to act independently or that the audit process was unfair. It therefore declined to cancel the appointment of the audit firm or allow amendments to the original lawsuit at this stage.
Justice Abinyo noted that any developments involving payments or account transactions could be presented as evidence during the hearing of the main case.
