KPMG partners hit with £90,000 pay cut
Fall in partner remuneration down to investment and fall in advisory services' performance
PARTNERS at KPMG have been hit with a £90,000 pay cut in order to fund investments and as a result of a decline fees from advisory work.
KPMG said it had cut the pay of its 617 UK-based partners by 13%, while boss Simon Collins [pictured] took a £300,000 pay cut, taking home £2.2m.
The news comes as the Big four firm said revenues increased 2.6% to £1.96bn. Fees from advisory work fell 5% to £308m, while audit fees increased 9% to £181m, while tax increased 17% to £151m.
However, profits dropped to £383m from £414m as the firm continued to invest in new offices and a series of consulting acquistions.
KPMG has made a slew of acquisitions over the last 12 months, spending around £49m in the process. Around £120m was spent on property, plant and equipment, including fit-out of new offices, hubs and a client meeting space in London’s West End, while £27m went towards staff training and development.
Simon Collins, chairman of KPMG UK, said: “Our industry is in the midst of historical change: the statutory audit is being overhauled at home and internationally; the tax debate is hotly contested and the demand from business for independent consulting services in transformation, risk, technology and corporate finance is huge.
“We have introduced audit opinions which go beyond regulatory requirements to meet investor needs better; engaged in international regulatory change on tax and invested heavily – to the tune of £49m – in acquisitions which bolster our consulting business. Overall, we have invested £196m in our business to set it on the path to sustainable long-term profitable growth.
“Though growth is not yet where we want it to be, we have held our nerve on our investments and I am pleased that we are now seeing returns come through.”
KPMG is under pressure over its audit work at HBOS prior to the bank’s collapse in 2008, with MPs calling for the FRC to launch a full investigation into the firm’s role in the bank’s failure.
The firm also faced embarrassment after four senior partners at its Belfast offices were arrested as part of an HM Revenue & Customs investigation into alleged tax evasion.