KPMG to review auditor ahead of Europe push
KPMG will conduct a review of all its suppliers, including UK auditors Grant Thornton, as it forges ahead with the merger between the UK and German businesses to form KPMG Europe
Grant Thornton has audited
KPMG in the UK for 12 years
and audited the Big Four firm in 1996, when KPMG became the first UK practice to
publish a set of audited accounts publicly.
A spokesman for KPMG, however, said the firm’s audit would almost certainly
come up for review – the first time this has happened since Grant Thornton was
appointed in September 1995.
‘Now that we have entered into KPMG Europe, there is likely to be a review of
all our suppliers, including our auditors,’ the spokesman said.
The news of the KPMG auditor review emerged as Accountancy Age surveyed the
auditing arrangements of the UK’s 20 largest firms.
The survey found that, like many of their clients, firms were experiencing
double-digit increases in their auditing costs. Accountancy Age found that, on
average, firms were paying up to 14% more for their audits than they were a year
ago.
Audit fees did differ markedly between larger and smaller firms. The Big Four
paid around £300,000 for their audits. Mid-tier rivals BDO Stoy Hayward and
Grant Thornton paid no more than £200,000 to auditors. Firms behind the mid-tier
group paid £100,000 or less.
The survey also revealed that the profession did not like to rotate auditors,
even though several firms have campaigned aggressively for more frequent auditor
rotation.
Ernst & Young has stuck with current auditor BDO Stoy Hayward for 20
years, Grant Thornton has audited Deloitte for four years and
PricewaterhouseCoopers has employed Horwarth Clark Whitehill for 11 years.
Professional services experts Horwarth Clark Whitehill and Grant Thornton led
the way with the most top 20 clients, each conducting three audits. PwC and
Kingston Smith have two top 20 firms each. No other firm has more than one.
