KPMG partner pay slides after challenging year
Partner pay at KPMG UK fell seven per cent in 2018-19 after a year when the firm strove to deal with the fallout from a series of scandals.
In the year to 30 September, KPMG average partner pay fell to £640,000 from £690,000 the previous year.
Profit before taxation and members’ profit shares fell nearly 14 per cent to £307m down from £356m in 2018.
Read more: KPMG to slash partner bonuses by up to 40 per cent
Revenue increased three per cent to £2.4bn from £2.34bn the previous year.
The firm has been under political and regulatory pressure to up its game after it was implicated in scandals such as the collapse of outsourcer Carillion.
It is under investigation by watchdog the Financial Reporting Council (FRC) for its Carillion audit and its audit of Bargain Booze owner Conviviality
KPMG was hit with £18.5m in fines by the FRC last year, the most of any audit firms. Individual partners were fined a cumulative £525,000.
Read more: KPMG launches £100m cost-cutting programme
The firm has embarked on a major overhaul of its audit practice, with £45m invested into the practice this year as part of a planned £200m investment in audit by the end of 2020.
The firm hired more than 700 auditors and 1,900 graduates and apprentices, while £23m was spent on audit-specific training.
Chairman and senior partner Bill Michaels said: “We are creating a business that stands ready for the fundamental changes we expect to see over the next few years, both from the reforms necessary to rebuild trust in our sector and as we pivot our business to meet the changing nature of the work we are doing for our clients.
“We have undertaken a comprehensive overhaul of our audit practice, reappraising every aspect of what it does and how it interacts with the rest of the business. Central to that has been investing heavily in our capability and capacity to deliver the audit of the future.”