KPMG profits fall after turbulent year for auditors

KPMG has unveiled a 7 per cent drop in profits per partner, despite recording a rise in annual revenues.

Catherine Burnet, KPMGs senior partner in Scotland, said the firm is 'driving change'. Picture: Mike Wilkinson

The Big Four accountancy firm saw average partner distribution fall to £640,000 in the year to September, down from £690,000 in 2018.

This was despite revenues climbing 3 per cent to £2.4 billion, driven largely by 10 per cent growth in the group’s audit practice.

KPMG flagged a year of “unprecedented” investment, particularly in its auditing arm, during a year which saw the professional services giant receive a number of fines from the audit regulator.

The Big Four accounting firms have come under fire from the Financial Reporting Council over their audit practices. KPMG said it plans to invest a total of £200 million in its auditing department by the end of 2020.

Chairman Bill Michael, who took home a paycheck of £1.9m, said: “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.”

Catherine Burnet, KPMG’s senior partner in Scotland, said: “Despite the difficult backdrop, our team of over 1,200 people in Glasgow, Edinburgh and Aberdeen, have been at the forefront of driving positive change. This is demonstrated in our new managed services hub in Glasgow, and our partnerships with organisations such as Glaswegian start-up space Clockwise.”

The firm’s headcount grew from 16,300 to more than 17,600 at the end of year.