KPMG research, however, indicates that local finance heads could soon be fending off takeover attempts from emerging markets rather than pursuing them.

In a study tracking merger and acquisition activity in emerging markets, KPMG found that four years ago the number of deals into emerging markets outnumbered transactions coming the other way by four to one. In the first half of 2007 that ratio has shortened to less than two to one.

During the first six months of 2007, there were 67 emerging-into-developed deals taking place, against 126 developed-into-emerging transactions, prompting thoughts that emerging market businesses will soon become more active than their western counterparts.

'Looking at current trends, it's feasible that this crossover could happen within the next two to three years… the hunted are fast becoming the hunters,' said Ian Gomes, KPMG's UK chairman of new and emerging markets.

India was the most prolific outbound acquirer, closing 32 such deals during the six months to June 2007. Chinese businesses made 14 acquisitions into developed markets, up on the eight deals closed during the last six months of 2006, while Russian companies completed 11 international deals in the first half of 2007.

But why are companies in emerging markets so keen to buy into developed markets, when the real growth in the world economy is taking place on their doorsteps?

Alka Bali, a director at investment bank Close Brothers who has strong expertise in the Indian market, said there was growing confidence within emerging market companies in their ability to close deals abroad.

'A key influence is not only the growing ability of Indian corporates to finance these deals, but their increasing confidence,' Bali said.

Ian Coleman, head of emerging markets at PricewaterhouseCoopers, said emerging market companies were now more aware of opportunities in developed markets.

'There are a lot of companies looking to move into more developed markets where they can exploit their low-cost production capabilities and brandings,' Coleman said.

COMPANY REPORTS

Toy company restates income tax

Errors uncovered in how Toys 'R' Us recorded its income taxes, has forced the retailer to restate its first three quarters' numbers of 2006. In a regulatory filing with the SEC, Toys 'R' Us said it had restated net sales and expenses to reflect increases of $19m (£9.5m) and $35m for the quarter and fiscal year ending 29 July respectively.

SEC charges former Nortel execs

The SEC has charged four former finance executives at Nortel Networks Corp with engaging in accounting fraud. Those charged are Douglas Hamilton, Craig Johnson, James Kinney and Kenneth Taylor, who served as vice presidents of finance for Nortel's Optical, Wireline, Wireless and Enterprise business units, respectively.

It brings the number of senior executives charged to seven Ð in 2003 the US watchdog charged Nortel's former chief executive, chief financial officer and controller with directing the earnings management fraud that manipulated the Toronto-based company's reserves.

Nortel made no comment on proceedings against former company officers, but said it will continue to co-operate fully with the SEC.

KPMG called in at mortgage lender

Administrators from KPMG have been called in following the collapse of wholesale lender Victoria Mortgage Funding. The appointment was announced by regulator the Financial Services Authority, after the group was placed in administration. Christine Laverty and Michael McLoughlin of KPMG have been appointed as joint administrators of the lender. Up to 381 customers, who have current mortgage offers, may be affected.

Battle for talent hurting finance functions

The battle to find, recruit and retain talented individuals is hurting corporates' finance functions, according to new research from Deloitte. The firm found there was a deep gulf between the goal of the finance department and the talent it had to achieve that goal.

A worldwide survey of senior financial executives, conducted by Deloitte with the Economist Intelligence Unit, found that efforts to attract, keep and develop high performers was not a chief priority. Worryingly, only one third of CFOs surveyed had a recruitment strategy.

German groups should have more tax audits

Companies in Germany should be subject to more frequent corporate tax audits, rather than the country undergo tax law reform, the CFO of insurance giant Allianz has said.

Helmut Perlet said such a move would mean the government could scrap plans to reform the tax laws, according to an interview he gave to German financial newspaper Handelsblatt. 'It would then be unnecessary to tighten tax legislation applicable to non-residents and determine new fraud positions time and again,' Perlet said.