Questions raised about KPMG's new Rentokil audit role
KPMG will play a part in both internal and external audits
Rentokil Initial’s decision to use KPMG for both internal and external audit
has raised corporate governance questions, the
Financial
Times reports today.
KPMG will offer the business services company a streamlined audit service,
resulting in a £1m cost saving. But it is KPMG’s dual responsibility with both
the internal team and as the external auditor which has led some to raise the
issue of auditor independence.
The FT quoted a senior audit partner who said he didn’t think it was `good
governance to have external doing internal, since in reality you do need
internal audit to take on some management control.’
Alan Brown, Rentokil’s chief executive, said he believed there was no
conflict of interest and the arrangement would reduce complexity.
Oliver Tant, KPMG head of audit said there was no issue with the internal
audit unless the work spilled over into management.