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11/8/2018, 2:39 PM (Source: TeleTrader)
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KPMG stops nonaudit services for FTSE 350 firms

KPMG's chairman Bill Michael told partners in the professional services company in the United Kingdom that it would limit operations to auditing for clients included in the FTSE 350 stock market index, according to a memo leaked to the media. The move comes amid the regulators' scrutiny into the conduct of major firms in the sector in the runup to the collapse of construction contractor Carillion at the beginning of the year.

The Competition and Markets Authority has launched an investigation into possible conflicts of interest and dominance of the so-called big four accounting entities. The Financial Reporting Council has also been conducting a review and last month slammed KPMG for deterioration in the quality of the audits, highlighting the case among the probes into Deloitte, Ernst and Young and PricewaterhouseCoopers.

The company headquartered in Amstelveen in the Netherlands decided to implement the measure within the said framework as it would be the "most impactful" approach, Michael allegedly wrote. He is said to claim the business model of KPMG and its peers is "the only realistic" one, being "multidisciplinary," but hat it is open to solutions like limits for market share.

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