KPMG LLP, the U.S. audit, tax and advisory firm, last week announced revenues of $4.1 billion for its most recent fiscal year ended September 30, 2004, an 8 percent increase over the prior year's revenues of $3.8 billion. KPMG Americas' combined revenues, representing member firms of KPMG International in Latin America, Mexico, the Caribbean, the United States, and Canada, also rose 8 percent for the same period to $4.9 billion.
"The U.S. firm achieved strong performance in a challenging environment, recording its 10th consecutive year of revenue growth," said Eugene D. O'Kelly, chairman and CEO, KPMG LLP. "FY04 results were accomplished in a year framed by extraordinary demands on people resources, due in part to the compliance requirements of section 404 of the Sarbanes-Oxley Act.
KPMG Americas Results
In the Americas region, KPMG LLP and other member firms of KPMG International recorded a combined $4.9 billion in revenues, an 8 percent increase over the prior year's combined revenues of $4.5 billion, said O'Kelly, who is also chairman of the region.
Member firms' Audit and Risk Advisory (ARAS) revenues in the region totaled $3.61 billion, a 16 percent rate of growth, versus combined revenues of $3.12 billion in fiscal year 2003. As in the case of the U.S. firm, ARAS practice revenues outside this country were influenced overall by the market's response to the Sarbanes-Oxley Act, O'Kelly added. Separately, tax revenues in the region declined 4 percent on total revenues of $1.37 billion, versus $1.43 billion in FY03.
KPMG's Strategic Priorities
"Quality in our audit, risk advisory, and tax practices and in our client service support remain our number one priority. And we're backing up our commitment to quality with significant financial investments in processes, tools, and training," O'Kelly said. "Fiscal year 2005 will require balancing the workloads of our people while also achieving audit quality. We will be mindful that our quality and people goals - not the unprecedented market opportunity we currently face - drive our growth goals for FY05.
"Becoming an employer of choice within our profession is a long-term strategic priority and commitment, and an integral part of our business model," O'Kelly said. "KPMG's people will sustain and strengthen our reputation for quality and integrity. We will continue our progress toward making KPMG a great place to work, and to advance the careers of everyone in a rewarding environment, therefore enhancing our ability to succeed in the marketplace."
KPMG is committed to quality, independence and "performance with integrity"
- a guiding principle that O'Kelly said he instilled as KPMG's chairman over the past two years. He said this commitment has resulted in key structural and process changes central to KPMG's efforts to restore professional credibility and investor confidence. "Integrity has become the most important differentiator in our business today. Performance with integrity means that our brand stands for quality, reliability, and professionalism in everything we do," he said.
Additional Fiscal 2004 Accomplishments
O'Kelly also noted that in fiscal 2004, KPMG pursued several major initiatives:
- KPMG LLP, in an effort to help enhance the integrity and transparency of financial reporting, became the only firm to disclose, in August 2004, a summary of the Public Company Accounting Oversight Board (PCAOB) private Part II observations that were part of their limited
inspections of the Big Four audit firms, and KPMG's related actions.
- KPMG LLP continued to be at the forefront of helping audit committees and senior management enhance their awareness, commitment, and ability to implement effective audit committee processes - intended to improve financial reporting for the benefit of investors and the capital markets. In that regard, KPMG expanded its nationwide roundtable audit committee program this year through the KPMG Audit Committee Institute (ACI), created in 1999. Through its programs, ACI leaders in the United States have met directly with thousands of directors and officers and, since its inception, over 17,000 have attended the ACI's semi-annual Audit Committee Roundtable series.
- KPMG LLP realized, in view of recent events in the corporate community, that investors and the capital markets alike would also benefit greatly from the broad adoption of an enhanced level of business ethics and leadership among all organizations. As a result, KPMG launched "The Global Initiative on Leadership & Business Ethics," a three-pronged initiative underscoring the firm's commitment and leadership position in helping restore credibility to the accounting profession. As part of The Global Initiative, KPMG founded The Global Center for Leadership & Business Ethics, whose policies and processes are modeled on those of Nobel. Chaired by Bill George, former Chairman and CEO of Medtronic, Inc., and author of Authentic Leadership, The Global Center recognizes those individuals and organizations that exhibit extraordinary business ethics and leadership qualities.