KPMG

From Wikipedia, the free encyclopedia

KPMG

Type	Cooperative
Founded	1987; individual components from 1870
Headquarters	Amsterdam, Netherlands
Key people	Michael D.V. Rake, Chairman
Industry	Professional services
Products	Audit Tax Advisory
Revenue	$16.9 billion USD (2006)
Employees	113,000
Website	www.kpmg.com

KPMG is one of the largest professional services firms in the world. KPMG employs 113,000 people in a global network spanning 148 countries. Composite revenues of KPMG member firms in 2006 were $16.9 billion USD (7.6% growth from 2005). KPMG has three lines of services: audit services, tax services, and advisory services. KPMG is a Big Four auditor, alongside PricewaterhouseCoopers, Ernst & Young and Deloitte Touche Tohmatsu.

1 Name
2 History
3 Legal Structure and Executives
4 Audit Clients
5 Tax shelter fraud
6 Notable current and former employees
7 See also
8 Citations
9 External links

[edit] Name

The title of the firm, KPMG, is actually an acronym. However, the roots of the name stem from four partners in the firms that merged to form KPMG.

K stands for Klynveld. This originates from the accounting firm Klynveld Kraayenhof & Co. founded by Piet Klynveld in Amsterdam in 1917.
P is for Peat, originating from the accounting firm William Barclay Peat & Co., which was founded by William Barclay Peat in London in 1870.
M stands for Marwick. James Marwick founded the accounting firm Marwick, Mitchell & Co. together with Roger Mitchell in New York City in 1897.
G is for Goerdeler. Dr. Reinhard Goerdeler was for many years chairman of the German Deutsche Treuhand-Gesellschaft (DTG) and later chairman of KPMG. He is credited with laying much of the groundwork for the KMG merger.

[edit] History

The Peat Marwick logo.

The KPMG logo used by member firms in the 1990s.

In 1870, William Barclay Peat formed an accounting firm in London, England
In 1911, William Barclay Peat & Co. and Marwick Mitchell & Co. merged to form what would later be known as Peat Marwick International (PMI).
In 1979, Klynveld merged with Deutsche Treuhand-Gesellschaft (DTG) and McLintock Main Lafrentz to form Klynveld Main Goerdeler (KMG).
In 1987 both firms joined forces in the first mega-merger of large accounting firms and formed KPMG.
In 1997, KPMG and Ernst & Young announced that they were to merge, in a maneuver largely seen as a spoiling tactic over the merger of Price Waterhouse and Coopers & Lybrand. However that merger, to form PricewaterhouseCoopers, was granted regulatory approval while the KPMG/Ernst & Young tie-up was later abandoned.
In 2001, KPMG divested its U.S. consulting firm through an IPO of KPMG Consulting Inc, which is now called BearingPoint, Inc.. A song that was produced for KPMG, "Our Vision of Global Strategy", experienced a brief period of Internet notoriety.
In 2002, the UK and Dutch consulting arms were sold to Atos Origin.
In 2003, KPMG divested itself of its legal arm, Klegal.
In 2005, the U.S. member firm admitted criminal wrongdoing in multi-billion dollar tax shelter fraud.
In 2006, KPMG’s member firms in the UK and Germany proposed to merge and form a single entity, KPMG Europe LLP. With a projected turnover for the UK and German firms in excess of £2 billion in 2009, KPMG Europe LLP will most likely be the largest fully integrated accountancy firm even in Europe to Mexico.

[edit] Legal Structure and Executives

Each national KPMG firm is an independent legal entity and is a member of KPMG International, a Swiss cooperative registered in the Swiss Canton_of_Zug. KPMG International changed its legal structure from a Swiss Verein to a cooperative under Swiss law in 2003.^[1]

KPMG International is led by:

Sir Michael Rake, Chairman, Senior Partner of KPMG in the United Kingdom;
Dominic C.F. Ho and John B. Harrison, Chairman-Asia Pacific Region, Partner of KPMG in China and Hong Kong;
Timothy P. Flynn, Chairman-Americas Region, Chairman of KPMG in the United States;
Ben van der Veer, Chairman-Europe, Middle East and Africa Region, Chairman of KPMG in the Netherlands.

[edit] Audit Clients

KPMG member firms serve as the independent auditors for a large number of major corporations:

Consulting: Accenture, Gartner
Construction AMEC, Carillion, KBR
Energy: Devon Energy, Citgo, Halliburton, Murphy Oil, Occidental Petroleum, Petrobras, Reliant Energy, Sinopec, Valero
Financial Services: ABN AMRO, Allianz, Allstate Corporation, American Express, Aon Corporation, Citigroup, Countrywide Financial, Credit Suisse, Deutsche Bank, Deutsche Borse, First Republic Bank, Hang Seng Bank, HBOS, H&R Block, HSBC, MassMutual Financial Group, Munich Re, Nationwide Financial, Salomon Brothers, Standard Chartered Bank, Visa International, Wachovia, Wells Fargo
Healthcare: Caremark, Kaiser Foundation
Industrial Products: BASF, BMHC, BMW, Cemex, DaimlerChrysler, General Electric, Honda, Matsushita Electric Industrial Co., Mitsubishi Electric, Navistar International, Siemens AG, Weyerhaeuser
Media: BBC, Bertelsmann, ITV, Metro International, National Geographic Society, NBC Universal, RH Donnelley, RealNetworks, Sony BMG, Wolters Kluwer
Mining: BHP Billiton
Retail & Consumer Products: Anheuser-Busch, Burger King, Carlsberg, ConAgra Foods, Costco, CVS Pharmacy, Diageo, Federated Department Stores, Jack in the Box, J.C. Penney, General Mills, Hasbro, Heineken, Nestlé, Netflix, PepsiCo, Publix Super Markets, R.J. Reynolds Tobacco, Supervalu, The Hershey Company, The Home Depot, Winn-Dixie, Yum! Brands
Technology: Apple Computer, Boston Scientific, CA Inc., CNET Networks, Dolby Laboratories, Electronic Arts, EDS, Ericsson, LG Group, Motorola, Nortel, Philips, Samsung, Sanmina-SCI, Siemens, TiVO, VeriSign
Telecoms: Cable & Wireless, CenturyTel, China Mobile, Citizens Communications, Embarq, PCCW, SprintNextel, Qwest
Travel and Transportation: Alaska Airlines, Amtrak, Cathay Pacific, easyJet, EWS, Norfolk Southern Railway, US Airways

[edit] Tax shelter fraud

Main article: KPMG tax shelter fraud

In early 2005, the United States member firm, KPMG LLP, was accused by the United States Department of Justice of fraud in marketing abusive tax shelters. Under an agreement, KPMG LLP admitted criminal wrongdoing in creating fraudulent tax shelters to help wealthy clients avoid $2.5 billion in taxes and agreed to pay $456 million in penalties in exchange for a deferred prosecution agreement. KPMG LLP would not face criminal prosecution if it complied with the terms of its agreement with the government. On January 3, 2007, the criminal conspiracy charges against KPMG were dropped. [1] However, Federal Attorney Michael J. Garcia stated that the charges could be reinstated if KPMG does not continue to submit to continued monitorship through September 2008. [2]

Before the settlement, the firm, on the advice of its counsel Skadden, Arps, Slate, Meagher & Flom LLP, removed several tax partners and admitted "unlawful conduct" by those partners. The firm agreed to cooperate with DOJ's investigation and help prosecute former partners who had devised and sold the tax shelters. Additionally, the firm hired former U.S. district judge Sven Erik Holmes to monitor its legal and regulatory affairs.

[edit] Notable current and former employees

[edit] Business

Margaret Jackson - chairwoman of QANTAS (2000-present)
Syd Kessler - entrepreneur
Michael O'Leary - CEO of Ryanair (1994-present)
Zarin Patel - CFO of the BBC
Colin Sharman, Baron Sharman - chairman of Aviva (2006-present)
Frank Freeman - CEO of Genpact Americas(kpmg employees)

[edit] Politics and public service

Jerry Finnell - Mayor of Del Mar, California (2004-present)
Nick Gibb - Member of the British Parliament (1997-present)
Mark Harper - Member of the British Parliament (2005-present)
Toby Harris, Baron Harris of Haringey - member of the London Assembly(2000-04); chairman of the Metropolitan Police Authority (2000-04)
Michael Hirst - Member of the British Parliament (1983-87)
Edmund Ho - Chief Executive of Macau (1999-present)
Kevin Rudd - member of the Australian House of Representatives and Federal opposition leader (1998-present and 2006-present respectively)
Rita Verdonk - Dutch Minister for Integration and Immigration (2003–2007)

[edit] Other

Leslie Ferrar - Treasurer to Charles, Prince of Wales
Reinhard Goerdeler - son of Carl Friedrich Goerdeler
Amr Khaled - Extremely popular moderate Muslim preacher.
Bruce Marshall - writer
Michael Peat - Principal Private Secretary to Charles, Prince of Wales
Nate Silver - Executive VP of Baseball Prospectus, creator of PECOTA baseball projection system.^[2]
Johan van der Walt - forensic auditor
Kateryna Yushchenko-Chumachenko - wife of Viktor Yushchenko, current President of Ukraine

[edit] See also

KPMG audit of the Development Fund for Iraq
KPMG audit of Clearstream "bank of banks"

[edit] Citations

^ Handelsregister des Kantons Zug (Registration Number CH-020.6.900.276-5), http://hrazg.ch/
^ http://sports.espn.go.com/espn/page2/story?page=keri/070214

[edit] External links

Big Four auditors
Deloitte Touche Tohmatsu \| Ernst & Young \| KPMG \| PricewaterhouseCoopers

Retrieved from "http://en.wikipedia.org../../../k/p/m/KPMG_4544.html"