KPMG reassures staff over Andersen merger
Mike Rake, the senior managing partner of KPMG, has moved to reassure the firm's staff about the planned merger with crisis stricken Andersen.
Following a press conference this morningin which Andersen executives detailed the merger plans, Rake told staff in an internal email that measures would be taken to ensure any legal action against its future partner would not harm KPMG.
He said: ‘Any such combined organisation would initially take KPMG’s name,management and governance structures. Under such an agreement, we wouldensure that KPMG and its member firms are protected from any litigation,risks or liabilities associated either with the Enron issue or with othersignificant claims.’
Rake goes on to lay out the business argument for merging KPMG with Andersen.
‘Whilst KPMG is strong globally, a combination with Andersen is fullyaligned with our long-term objectives and it gives us the opportunity tolink with an organisation with which we have strong business synergies.Our relative strengths within different countries complement each other,as do our skills and expertise in markets and services,’ he said.
Perhaps more tellingly Rake makes it plain that Andersen had no choice, once the US criminal indictment emerged at the end of last week, but to seek a merger partner.
‘Following the indictment by the US Department of Justice, it became clearthat it was in the interest of its people, clients and the capital marketsas a whole for Andersen to seek to combine with one of the other ‘BigFive’ accounting firms.’ he said.
Though Andersen staged a press conference this morning no KPMG executives attended to represent the firm’s interests.