KPMG’s revenues rose by 8 percent from £2,172m to £2,338m for the financial year which ended on 30 September 2018.
The firm’s annual review also revealed that profit increased by 18 percent to £356m. This was in a difficult year for KPMG, who faced criticism after the collapse of its audit client Carillion in January.
However, the company now audits 28 of the FTSE 100 companies, putting it ahead of PwC with only 27.
“These results are the product of the tough decisions we have made and the hard work of our 16,000 people across the UK,” said KPMG chairman and senior partner Bill Michael.
Average partner pay at KPMG rose to £601,000, increasing from £519,000. This still puts it behind other companies including Deloitte. The chairman’s pay was £2.1m. This was Bill Michael’s first full year as chairman.
Changing audit market
KPMG, like other Big Four firms, has been vocal about the kinds of changes it would like to see in the audit market.
It was the first firm to voluntarily stop offering non-audit services to the FTSE 350 companies it audits. KPMG recommended that all audit firms in the UK should be banned from offering non-audit services in the same way.
“I have been clear that our wider profession faces challenges,” chairman Bill Michael said. “In order to safeguard against any perceptions of conflict of interest, we have drawn a clear line between our advisory and audit work for UK listed businesses.”
Submitting its response to the CMA consultation on the future of audit, KMPG suggested that ‘graduated audit findings’, which provide a more detailed insight to investors and the public on the risks and challenges faced by the audited company, should be compulsory for the FTSE 350. KPMG is working to adopt graduated audit findings by 31 December 2019 year end audits.
New recruits
KPMG, which operates in 154 countries, has hired 1,365 new graduates and apprentices across the UK to support its growth. This was a record number since its 2011 intake.
“Beyond our financial results, the aspect that has pleased me the most about the course of the year is the firm’s work to increase social mobility. We’re investing across the United Kingdom, recruiting people from all backgrounds, straight from school and university, to support our growth.” KPMG was ranked number 1 on the Social Mobility Employer Index.