KPMG in the UK announces 5% growth in revenues to £1.9bn
KPMG, the professional services firm providing audit, tax and advisory services, has announced today an increase in revenues from £1,814m to £1,909m (5%) for the financial year ended 30th September 2014.
Advisory services saw a 5% annual increase in contribution to profits from £308m to £324m, while audit saw a 2% increase from £178m to £181m and tax saw a reduction of 8% from £140m to £129m. Overall profits, before tax, were down 9% as the firm invested in its people, new business lines and new offices. Average partner pay was broadly flat, increasing marginally by 0.3% from £713,000 to £715,000.
The employee bonus pool increased by nearly 10% from £73m to £80m.
Simon Collins, UK chairman of KPMG, said: “We have invested substantially across our business: in people training and development, in an improved staff reward package, in new technology and in new offices in Manchester and London.
“A key component of our investment programme is our five ‘strategic growth initiatives’, which include digital and analytics and Enterprise for SME businesses. To achieve our growth ambitions in these five areas, we have formed new and ground-breaking alliances, such as with Imperial College, and developed new business lines organically, including an online accounting tool for small businesses. These investments are designed to deliver sustainable future growth for our firm.”
Transformation in KPMG’s audit practice in 2014, Simon said: “A highlight of the year is our new approach to audit reporting. This goes beyond the regulatory requirements and is designed to make the audit report more relevant and useful to investors. Looking forward, our alliance with McLaren Group offers the opportunity to deploy sophisticated predictive analytics on audit work.
“Our efforts are being recognised and, accordingly, we have secured some fantastic audit wins this year, for iconic companies such as Compass, the Royal Mail and Smith & Nephew. We have won more FTSE 100 audit tenders and retained more FTSE 100 audits put out to tender than any of our competitors. We audit the largest number of listed businesses in the UK and we take our responsibility to innovate and adapt audit reporting seriously.”
Developments in KPMG’s Advisory and Tax practices in 2014, Simon said: “During a time of transformation and investment, our business has advised on some of the most exciting infrastructure projects which are shaping the future of the UK, including HS2, the new nuclear power station at Hinkley Point, Thames Tideway Tunnel, and airports expansion in the south-east. We have even greater ambitions for the future, not least as our advisory business is also working closely with McLaren to apply data and analytics know-how to consulting work such as supply chain management.
“Our tax practice, which has one of the largest indirect tax teams, was disproportionately affected by changes in the indirect tax market and forthcoming EU reforms on supplying non-audit services. However, the tax practice is on a firm footing for the future by diversifying and innovating with good growth in our corporate tax business, the development of new technology such as ‘KPMG Fusion’, a pension modelling tool, and with the launch of our multi-disciplinary legal services business. Further investments in our ‘centres of excellence’ in Glasgow and Birmingham are also strengthening our tax offering and creating jobs.”