KPMG Europe Adds Swiss Operation

by Ulrika Lomas, Tax-News.com, Brussels

31 December 2007

With the Swiss member of audit firm KPMG having voted to join the company's European operation in 2008 - creating the largest integrated accountancy firm outside the US - the big four accountant, which announced impressive results in 2006, has thrown down the gauntlet to its rivals.

When the merger between KPMG Europe LLP and KPMG Switzerland is complete, the combined firm will have more than 20,000 partners and staff, with revenues approaching EUR4 billion (US$5.9 billion).

Partners of KPMG Switzerland approved the merger proposal at their meeting in Zurich in June 2007. The Swiss vote is subject to approval from the new Swiss Federal Audit Oversight Board, expected by the Spring of 2008.

KPMG Europe was formed by a merger between the UK and German firms in October 2007 - creating Europe's largest accountancy firm - and the vote by the Swiss partners is the latest stage in creating a fully integrated KPMG member firm in Europe.

The intention is that other KPMG member firms in Europe will merge into the new entity, should they wish to join. The new firm will be chaired jointly by John Griffith-Jones, currently Chairman of KPMG LLP (UK), and Prof. Rolf Nonnenmacher, currently Chairman of the Managing Board, KPMG Deutsche Treuhand-Gesellschaft AG.

The consolidation of KPMG's international operations comes at a time when the company is enjoying some impressive results, particularly in the UK where turnover reached a record GBP1.6 billion (US$3.2 billion) in the year to September 30, 2007, up 11% compared with 2006. Meanwhile, the firm's UK profits rose by 20% to GBP447 million.

There has been growth across all of KPMG’s businesses. Audit revenue rose by 6%, with significant increases in the public sector - where KPMG audits more universities and housing associations than any other firm. Tax practice revenue rose by 11%, with the strongest growth in private equity, real estate, capital allowances, transfer pricing, supply chain management and pensions activities.

“In 2007, we produced outstanding UK results – a record year in terms of our performance. It was also a momentous year with the launch of KPMG Europe LLP," commented Griffith-Jones.

KPMG has also been recognised for the quality of its work for clients and was named ‘Global Firm of the Year’ at the 2007 ‘Accountancy Age’ awards. It was also named ‘Auditor of the Year’ for the third year in a row by leading finance directors.

"Increasingly, KPMG is becoming recognised and rewarded for its distinctive approach to providing better services for its clients, and a working environment that provides enormous opportunities for its people. I am confident that – with our colleagues in Germany and Switzerland – we have laid the foundations for a future that promises to be exciting in many different ways," Griffith-Jones added.

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