Rolf Nonnenmacher, Head of KPMG’s EMA region, said:
“While the audit profession was not the cause of the financial crisis referenced in the EU’s Green Paper, KPMG supports new policies and ideas to improve audit relevance and quality in the context of wider regulatory reform.
“KPMG believes that the proposals miss the opportunity to put in place a meaningful framework for change, and would have no bearing on audit outcomes.
“They are also in marked contrast to the views of the majority of stakeholders, including financial institutions, investors, MEPs, business and academics.
“Audit quality is best provided by multi-disciplinary firms. The capability of firms to provide quality audits will be diminished if auditors are separated from wide ranging advisory expertise including, crucially, risk management in the financial sector.
“Furthermore, KPMG is opposed to the mandatory rotation proposals - which would cause serious disruption to major corporates, and have no positive effect on audit quality. Audit committees are best placed to decide on the appointment of auditors.
“Today’s proposals focus on a desire to change the structure of the audit market. These issues would be best considered by the appropriate competition authorities, as is happening in the UK at present.
“KPMG is among a number of contributors who have put forward new ideas for improving audit quality, encouraging more choice and improving confidence in financial markets.
“These include a more structured approach to communications with supervisors and prudential regulators; strengthening the role of the audit committee; and more risk and narrative reporting.
“KPMG will work to persuade the European Parliament and the Council of Ministers to take full account of the responses received to the EU consultation document, and looks forward to a positive dialogue to fundamentally alter these proposals.”
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Media enquiries to:
Gavin Houlgate, Director of Communications, KPMG in the UK
020 7694 3902
Mark Hamilton, Corporate Communications, KPMG in the UK
020 7694 2687
About KPMG
KPMG is the global network of professional services firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity, that provide audit, tax and advisory services. KPMG Europe LLP, a UK limited liability partnership, is the legal entity which effectively controls the member firms of the KPMG network that have elected to merge with it ("'KPMG Europe LLP firms"). KPMG Europe LLP and KPMG International provide no client services. KPMG Europe LLP firms operate in 16 countries across Europe with 30,000 partners and staff. The “KPMG Europe LLP group” means KPMG Europe LLP, and KPMG Europe LLP firms. The KPMG Europe LLP group recorded consolidated revenues of €4.1 billion and pro-forma revenues for the 16 countries for 2010 totalled 4.4 billion.
