is one of the largest professional services
firms in the world. KPMG employs over 123,000 people in a global network of member firms spanning over 145 countries. Composite revenues of KPMG member firms in 2007 were $19.8 billion USD (17.4% growth from 2006). KPMG has three lines of services: audit
services, and advisory
KPMG is a Big Four auditor, alongside PricewaterhouseCoopers, Ernst & Young and Deloitte Touche Tohmatsu.
The roots of the name "KPMG" stem from four partners in the firms that merged to form KPMG.
- In 1870, William Barclay Peat formed an accounting firm in London
- In 1877 accountancy firm Thomson McLintock opens in Glasgow
- In 1911, William Barclay Peat & Co. and Marwick Mitchell & Co. merged to form Peat Marwick Mitchell & Co, later known as Peat Marwick.
- In 1917 Klynveld opened his accounting-firm in Amsterdam. Later he merged with Kraayenhof to Klynveld & Kraayenhof Accountants.
- In 1979, Thomson McLintock forms KMG (Klynveld Main Goerdeler) a grouping of independent national practices to create a strong European-based international firm.
- In 1987 Thomson McLintock/KMG and Peat Marwick joined forces in the first mega-merger of large accounting firms and formed a firm called KPMG in the US and Peat Marwick McLintock in the UK.
- In 1990, the two settled on the common name of KPMG Peat Marwick McClintock.
- In 1991, the firm is renamed KPMG Peat Marwick.
- In 1995, the name is reduced again to KPMG.
- In 1997, KPMG and Ernst & Young announced that they were to merge, in a manoeuvre largely seen as a spoiling tactic over the merger of Price Waterhouse and Coopers & Lybrand. However that merger, to form PricewaterhouseCoopers, was granted regulatory approval while the KPMG/Ernst & Young tie-up was later abandoned.
- In 2001, KPMG divested its U.S. consulting firm through an IPO of KPMG Consulting Inc, which is now called BearingPoint, Inc..
- In 2002, the UK and Dutch consulting arms were sold to Atos Origin.
- In 2003, KPMG agreed to pay $125 million to settle a lawsuit stemming from the firm's audits of the drug chain Rite Aid.
- In 2003, KPMG divested itself of its legal arm, Klegal.
- In 2003, KPMG LLP sold its Dispute Advisory Services to FTI Consulting.
- In 2004, KPMG agreed to pay $115 million to settle lawsuits stemming from the collapse of software company Lernout & Hauspie Speech Products NV.
- In 2005, the U.S. member firm admitted criminal wrongdoing in a multi-billion dollar tax shelter fraud.
- In 2006, Fannie Mae sued KPMG for malpractice for approving years of erroneous financial statements.
- In February 2007, KPMG Germany investigated for ignoring questionable payments in Siemens bribery case.
- In October 2007, KPMG's member firms in the UK, Germany, Switzerland and Liechtenstein merged to form KPMG Europe LLP. They now have joint Chairmen, John Griffith-Jones and Ralf Nonnenmacher.
- In March 2008, KPMG accused of enabling “improper and imprudent practices” at New Century Financial, a failed mortgage company.
- In March 2008, KPMG agreed to pay $80 million to settle suits from Xerox shareholders over manipulated earnings reports.
Legal structure and executives
Each national KPMG firm is an independent legal entity and is a member of KPMG International, a Swiss cooperative
registered in the Swiss Canton of Zug
. KPMG International changed its legal structure from a Swiss Verein
to a cooperative
under Swiss law in 2003.
KPMG International is led by:
- Timothy P. Flynn, Chairman-Americas Region, Chairman and CEO of KPMG LLP (US), has led KPMG International since October 01 2007;
- Carlson Tong and John B. Harrison, Chairman-Asia Pacific Region, Partner of KPMG in China and Hong Kong;
- Ben van der Veer, Chairman-Europe, Middle East and Africa Region, Chairman of KPMG in the Netherlands.
offers the following services:
- Audit: Statutory Audit and Financial Statement Audit
- Tax: Business and Personal Tax services
- Advisory: KPMG's advisory services are organized into three themes (growth, governance and performance) and nine service lines:
- Accounting Advisory Services
- Business Performance Services
- Corporate Finance
- Financial Risk Management Services
- Internal Audit Services.
- IT Advisory
- Transaction Services (M&A)
- Actuarial services
KPMG member firms serve as the independent auditors for a large number of major corporations:
- Consulting: Accenture, FTI Consulting, Gartner, Shaw Group
- Construction and Real Estate AMEC, Carillion, CB Richard Ellis, KBR, Lend Lease Corporation, Lexington Realty Trust, Tishman Speyer, Jones Lang LaSalle
- Energy: Citgo, Devon Energy, Halliburton, Husky, Kuwait Petroleum Corporation, LUKoil, Murphy Oil, Occidental Petroleum, Petrobras, Reliant Energy, Sinopec, TransCanada Pipelines, Valero Energy Corporation
- Financial Services: AIB, Aetna, Allianz, Bank of East Asia, Bank of Montreal, Bank of New York Mellon, Citigroup, Climate Exchange, Countrywide Financial, Credit Suisse, Deutsche Bank, Deutsche Börse, Dresdner Bank, Fidelity National Financial, Fidelity National Information Services, First Republic Bank, International Bank of Commerce, Hang Seng Bank, HBOS, HSBC, Legg Mason, MassMutual Financial Group, Moody's, Munich Re Group, Nationwide Financial, Northern Trust, Old Mutual, Oppenheimer Funds, Prudential plc, Postfinance, Raymond James Financial, Salomon Smith Barney, Standard Chartered Bank, Travelers, Visa International, Wachovia, Wells Fargo
- Government & Education: Georgia Lottery, St. Mary's University, Santa Clara University, CPS Energy, City of San Antonio, State of Texas, State of Illinois, University of Chicago, US Department of Homeland Security, US Department of Justice, US Department of Energy, US Department of Interior, State of New Jersey, Office of Personnel Management, US Department of Treasury, Triumphant Institute of Management Education
- Healthcare: Ansell, Caremark, Kaiser Foundation, Res-Care, Providence Health System, Swedish Health Services, Mount Auburn Hospital, Partners In Health
- Hotels: Hyatt Corporation
- Industrial Products: Asahi Glass Co., BASF, BMHC, BMW, Cemex, DaimlerChrysler, General Electric, Honda, Jabil Circuit, Komatsu Limited, Matsushita Electric Industrial Co., Mitsubishi Electric, Navistar International, Severstal, Siemens AG, Sumitomo Group, ThyssenKrupp AG, Weyerhaeuser
- Media: BBC, Bertelsmann, ITV, Metro International, National Geographic Society, NBC Universal, R.H. Donnelley, RealNetworks, Sega, Sony BMG, Sun-Times Media Group, Wolters Kluwer, Virgin Group
- Mining: BHP Billiton, Rusal
- Pharmaceutical: Pfizer
- Retail & Consumer Products: Alberto-Culver, Arla, Asahi Breweries, Burger King, Cargill, Carlsberg, Carrefour, Circuit City, ConAgra Foods, Costco, Darden Restaurants, Diageo, Federated Department Stores, Jack in the Box, J.C. Penney, General Mills, Hasbro, Heineken, Hooters of America, Macy's, Metro AG, Mohawk Industries, Morton's of Chicago, Nestlé, Netflix, Office Max, PepsiCo, Publix Super Markets, R.J. Reynolds Tobacco, Ruth's Chris Steakhouse, Seaboard, Shiseido, Supervalu, The Hershey Company, Home Depot, Maple Leaf Foods, Winn-Dixie, Yum! Brands
- Technology: Adobe Systems, Apple Computer, Applied Materials, Beckman Coulter, Boston Scientific, Carl Zeiss AG, CA Inc., Cerner, CNET Networks, Dolby Laboratories, Electronic Arts, EDS, Ericsson, LG Group,Morrison Supermarket, Motorola, National Semiconductor, Navteq, Nortel, Philips, Samsung, Sanmina-SCI, Siemens, Symantec, TDK Corporation, TiVO, WebEx, VeriSign, Infosys, Wipro
- Telecoms: Cable & Wireless, CenturyTel, China Mobile, China Telecom, Citizens Communications, Embarq, PCCW, Rogers Communications, SprintNextel, Qwest, Cablevision
- Travel and Transportation: Air France, Alaska Airlines, Amtrak, Asiana Airlines, Brink's, BMW, Cathay Pacific, China Southern Airlines, Chrysler LLC, Daimler AG, easyJet, EWS, EVA Air, Frontier Airlines, KLM, MTR Corporation, Norfolk Southern Railway, Ryanair, US Airways, WestJet, Qantas
Tax shelter fraud
In early 2005, the United States member firm, KPMG LLP, was accused by the United States Department of Justice of fraud in marketing abusive tax shelters. KPMG LLP admitted criminal wrongdoing in creating fraudulent tax shelters to help wealthy clients avoid $2.5 billion in taxes and agreed to pay $456 million in penalties in exchange for a deferred prosecution agreement. KPMG LLP would not face criminal prosecution if it complied with the terms of its agreement with the government. On January 3, 2007, the criminal conspiracy charges against KPMG were dropped. However, Federal Attorney Michael J. Garcia stated that the charges could be reinstated if KPMG does not continue to submit to continued monitorship through September 2008.
Before the settlement, the firm, on the advice of its counsel Skadden, Arps, Slate, Meagher & Flom LLP, removed several tax partners and admitted "unlawful conduct" by those partners. The firm agreed to cooperate with DOJ's investigation and help prosecute former partners who had devised and sold the tax shelters. Additionally, the firm hired former U.S. district judge Sven Erik Holmes to monitor its legal and regulatory affairs.
KPMG is one of the top 10 companies for working mothers. It is also ranked No. 71 on Fortune Magazine's list of 100 Best Companies to Work For, voted for by employees.
KPMG ranks No. 5 out of 125 among companies with the best training programs according to "Training Magazine".
KPMG was the preferred employer among the Big Four accounting firms according to College Grad.com. It was also ranked No.5 on the list of "50 Best Places to Launch a Career" in 2008.
In 2008 KPMG in the UK was named the best big company to work for by The Times. This was the fourth consecutive year that KPMG has made the top three winning three times in that four years.
Sponsorship and Media
In February 2008, Phil Mickelson, ranked one of the best golfers in the world, signed a three-year global sponsorship deal with KPMG. As part of the agreement, Mickelson will wear the KPMG logo on his head wear during all golf related appearances. Mickelson will also attend a number of KPMG sponsored marketing events.
Notable current and former employees
Politics and public service
Tax Me if You Can
- PBS Frontline
documentary into corporate tax avoidance and its implications, including the role of KPMG in tax related services