KPMG boosts staff bonus pool by 20%


KPMG bonus pool

KPMG has boosted its staff bonus pool by 20% after restoring profits growth following the " first and toughest year" of a three-year turnaround plan.

The professional services firm, which has 583 partners and employs 10,800 staff after cutting about 3% of its workforce in 2012, said UK profits rose 27% to £455 million in the year to September 30.

Average pay for partners increased by 23% to £713,000, while the staff bonus pool lifted by 20% to £73 million. The business has 22 offices across the UK.

Simon Collins, who is UK chairman and senior partner, is to receive £2.4 million after his remuneration package was approved by a vote of partners.

Mr Collins, who founded KPMG's debt advisory practice in 1998 and became chairman in 2012, said: " We have completed the first and toughest year of our three-year transformation plan; getting a sustainable grip on the bottom line.

"I'm really proud that, as a result, we have generated double-digit growth in profitability, which boosts us from fourth to second of our peer group."

Revenues increased marginally by 0.4% to £1.81 billion, with the audit division posting the largest improvement in profit contribution, up by 16% to £178 million.

The arm was recently boosted by consumer goods firm Unilever's decision to ask KPMG to audit its books after 27 years with PwC - weeks after KPMG's work for banking giant HSBC went in the opposite direction.

Earlier this year, the Competition Commission urged major companies to rotate their auditors every 10 years amid concerns about the level of competition.

Advisory services saw a 15% annual increase in contribution to profits to £308 million, while tax saw a small reduction to £140 million.

The company plans to invest £450 million in the UK over the next three years, with some of the spending already evident with the opening of a new t ax compliance centre in Glasgow and acquisition of advisory firm Makinson Cowell.

Mr Collins reported a successful year in technology-related issues such as cyber security and expanding its Tech City hub in London's Shoreditch, with similar developments in Cardiff, Bristol, Leeds and Manchester.

He added: "Our latest UK tax competitiveness report has shown that business still feels that the UK is one of the most competitive geographies to locate.

"We support a fair regime, which is stable and backs companies' efforts to grow; striking the right balance between encouraging investment into the UK and generating tax revenues for the benefit of the UK as a whole."