Message from our Managing Partner
Welcome to our 2020 KPMG Transparency Report. This report outlines KPMG’s continued commitment to our regulators, investors, audit committees and other stakeholders.
When we issued our 2019 Transparency Report we were facing into the initial stages of a health and economic crisis unlike anything experienced in the last century. Over the last 12 months the COVID-19 pandemic has presented a diverse set of challenges for our clients and for our own organisation, pushing us to think differently about how we engage with our people, companies we audit, stakeholders and society. I am very proud of how our people have adapted with renewed commitment to deliver exceptional service for our clients and to serve the public interest by leading our profession in audit quality.
Looking forward to the world post-crisis, I am confident we have learned many lessons over the last year that will endure to make a positive and lasting contribution to our society and our economy. Despite the challenges we will face I am optimistic about the future as we start to see the early economic impact of widening vaccination coverage and the potential for easing lockdown begins to emerge. I believe that the digital transformation accelerated or started as a result of the crisis will continue to make Irish businesses more competitive and resilient.
At KPMG we expect that the future of work will involve a hybrid model of in-presence and remote working to enable our people to get the best of both working experiences. It was fantastic to see how quickly our team of over 3000 employees, including over 1300 auditors, adapted.
The last 12 months have made business leaders more aware than ever of the vulnerability of our society to external factors and the need for companies to be run in a manner that has purpose and is socially responsible. Our business is today actively focused on measuring and reducing our impact, including making our own commitment to be net zero carbon by 2030. KPMG remains determined to make a positive impact on the world, driven by our purpose. We encourage our people to take a long-term perspective in all their work. All of our actions are guided by our Values. They drive our daily behaviours, guide our decisions and shape our culture. Integrity remains a core Value — we do what is right, in the right way, at the right time.
Investment and innovation
Investment and innovation are key to the continuing success of our business. We continue to invest heavily in our people both via training and by providing them with the tools and technology to perform their audit responsibilities effectively and efficiently. In 2020 this investment focused significantly on the training and retention of excellent people who share in the firm’s uncompromising focus on quality. The environment our clients operate in continues to evolve, becoming more complex, more regulated and increasingly driven by technological developments. We continue to focus on innovation in areas such data analytics, cybersecurity and applied intelligence all of which have enabled us to maintain our commitment to high quality.
Audit at the heart
Our audit business has always been at the heart of our firm and executing our audits to the highest quality is core to our ambition. We recognise the trust that companies, regulators and others put in us to deliver high quality audits that contribute to financial reporting integrity so that investors have the confidence and trust to make key decisions.
Our firm’s system of quality control and selected individual audit engagements are subject to regular inspections by our external regulators including the Irish Auditing and Accounting Supervisory Authority (IAASA) and this report provides an overview of those inspections. In addition, we are subject to the internal review programmes of KPMG International and details of these are also set out later in this report. We welcome this oversight by our regulators and KPMG International and see this as a critical input to our relentless focus on enhancing audit quality.
In our 2020 Transparency Report we have shared with you details of our approach to audit quality and the initiatives that have been implemented to ensure we continue to maintain a relentless focus on quality to justify the trust placed in us by the various stakeholders we serve. It is critical that we provide exceptional quality on a consistent basis both to ensure we live up to the expectations of these stakeholders and to guarantee the long term success of our business. Our commitment to delivering on this expectation is facilitated by
- Our Ambition: to be Ireland’s most successful and ambitious firm with our clients and respected as a trustworthy firm that all our people are proud to be part of. A relentless focus on quality is central to achieving this ambition.
- Our Culture: a quality centric culture is essential to continually delivering high quality audits. We strive to lead by example through leadership behaviours on quality and ensuring our “tone at the top” supports this culture.
- Our Business: we have continued to invest in audit quality initiatives, growing our Audit Quality and Professional Practice team, investing in our system of quality management with the roll out of International Standard on Quality Management 1 (ISQM1) and embedding audit quality in our main audit business units by dedicating additional partner resources to audit quality matters.
- Our Global Network: together with our global colleagues we are united in our commitment to achieving and maintaining the very highest quality standards. Our Global Board has implemented changes to the governance and control systems in our network to support a globally consistent audit quality model.
In the message from our Head of Audit, Sean provides some insights into how the above have been brought to life in our audit practice.
Public Interest Committee
In this report, you will also hear from the new Chair of our Public Interest Committee, Mary Harney, who I was delighted to welcome into this role during the year, along with Padraig McManus who joined as a new member of this committee. I would like to take this opportunity to recognise and thank our outgoing Chair, Pat Cox, for his guidance and support over the last seven years.
What's next for business
In this ever-evolving world we are hugely conscious of the challenges facing businesses today. In that regard it is and remains our privilege to partner with our clients in planning for what’s next in their business.
I trust that the information provided in this Transparency Report is of interest and demonstrates that maintaining our focus on quality is critical to our business and to society particularly in times of uncertainty like this. I am happy to engage with and discuss any aspects of our business with any of our stakeholders.
30th April 2021