KPMG Australia announces FY17 results
KPMG Australia announces FY17 results
KPMG Australia today announced its full year results to 30 June 2017, increasing revenue by 10 percent to $1.5 billion.
Above-target growth was achieved across businesses, driven by strong investment, the quality of client solutions, and putting clients first.
“We’ve had an excellent year in 2017 and it’s all down to the efforts of our people. Our result follows double digit growth last year as well. Very pleasingly all of our businesses grew, with Management Consulting, Deal Advisory, Tax and Enterprise the stand-outs,” said KPMG Australia CEO, Gary Wingrove.
“Investments played a significant role in achieving the result, driving an enhancement in both the breadth and depth of our capabilities. Our investment strategy has been carefully planned based on three things – team and people hires, acquisitions, and a new approach to alliances. Our increasing focus on alliances gives us even greater capability to provide fully fledged, broad based solutions to help our clients achieve their goals.”
KPMG Australia made four acquisitions during the year: Acuity Research & Insights (building strong capability in customer research and insights); 3 degrees consulting (board advisory), Arrilla (Indigenous advisory); and Trace Chartered Accountants, enabling the firm to open its third office in greater Sydney.
KPMG Australia Chairman, Peter Nash, commented: “The expansion of our offerings based on our understanding of disruptive technology and its business impacts is a differentiator for us. Clients are increasingly looking for technology to play a pivotal part in the solutions we deliver. We continue to expand the firm’s artificial intelligence, machine learning, robotics and cognitive capabilities, helping clients transform all parts of their businesses in unprecedented ways.”
Management Consulting continued to be the largest and fastest-growing business, achieving double digit growth driven by success in large transformational work. The momentum in capability expansion continued, including in the fast-growing areas of customer and engineering advisory. Investment in a new Internet of Things (IoT) practice supported clients to capitalise on innovation, transformation and process efficiencies.
Despite relatively flat market conditions, Deal Advisory also delivered double digit growth spread across all service offerings. A solutions-based approach, combined with embracing new technologies (such as proprietary benchmarking, strategic profitability insight and working capital optimisation tools) derived added value for clients and differentiated the firm from traditional providers.
Risk Consulting’s growth was led by Internal Audit and Risk Compliance Services’ (IARCS) and Actuarial successes, as the practice pursued its technology-driven strategy. New competencies were added including third party risk, claims management, contract compliance assurance, ethical sourcing, and human rights consulting.
The firm’s mid-market business, KPMG Enterprise, also delivered strong growth as it expanded its national footprint. The newly-established Enterprise Technology Team drove cloud solutions for clients, and a new High Growth Ventures practice was launched for the start up community.
KPMG’s traditional businesses also had strong results, with Audit & Assurance revenues increasing for the fourth year running. Strong investment was made in audit technology, including participation in market-first global innovation using IBM Watson artificial intelligence.
Tax had its best ever revenue result, with Deals Tax, International Tax and the Tax Controversy groups achieving significant growth. Substantial continued investment was made in digital products, robotics and automation. KPMG Law’s outperformance was underpinned by the addition of a number of high quality legal practitioners, creating critical mass and broadening its reach and capacity across multiple sectors.
Asian client revenues saw high double digit growth, with strongest contributions from Chinese and South East Asian corridors. This follows strong market conditions over the past 12 months for inbound investment, combined with consistent growth from established Japanese and Korean client corridors.
KPMG’s Innovation & Digital Solutions business opened Insight Centres in Sydney and Melbourne, as well as an Innovation Lab in Sydney. Its U-Collaborate service line, specialising in helping organisations to accelerate decision making, grew strongly. A range of new digital products was launched, and ENR and Mining accelerator programs were run for industries in collaboration with specialist start ups.
KPMG’s Corporate Citizenship activities play a key role in differentiating the firm. A revised Citizenship strategy was launched focused on four pillars – Indigenous Australia, Skills for the Future, Mental Health and Climate Change - with the firm introducing its first climate change policy in Australia.
Peter Nash commented: “Importantly, the areas chosen were based on feedback from our people on where we should focus our efforts in our communities. We’ve been very active with Indigenous Australia for many years now. And I’m proud that this year, we became one of only three organisations to receive RAP Elevate status twice. We also launched our first dedicated Indigenous advisory practice during the year, and appointed our first Indigenous partner.”
“Our people are contributing to organisations across these areas as well, including more than 18,000 hours of pro bono work and more than 11,200 hours of volunteering and secondments for not-for-profit organisations,” he said.
KPMG’s 6,700 people, including 516 partners, collaborated to drive the result. The firm had a record intake of 62 new partners as well as a record intake of 420 graduates and 358 vacationers.
“We’ve employed more than 1,000 new people in the past year. And we’ve worked hard to ensure that they’ve come from diverse backgrounds so we can best offer diversity of experience, thought and solutions to clients,” said Gary Wingrove.
“Gender is one element of diversity, and today I’m pleased to announce we’ve now reached 23.8 percent female partners - ahead of the target we’d set ourselves for this year. We’re making good progress towards our target of 30 percent women in partnership by December 2020.”
The firm’s Global People Survey results showed continued greater engagement across all levels in the firm. “That’s a real positive for us. It tells us how our people feel about the organisation and reflects well on the growth we have, and the agile workplaces and the flexible working policies and practices that we’ve introduced.”
“Looking forward, I’m particularly proud of our new approach to performance management – it’s the firm’s most important people initiative. We’re adopting a people, rather than process approach to performance management built around regular, quality conversations focused on future careers,” he said.
Gary Wingrove concluded: “We’re very optimistic about the year ahead. There are certainly no shortages of client needs and investment opportunities. The challenge for us is to make sure we focus our investment and our activity in the right places. Our success in recent years tells us that we can, and will do this. We have a lot to look forward to in terms of opportunities.”
“In a strategic sense we are focused on continual investment, and are targeting similar growth.”
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