KPMG International Global Chairman, John Veihmeyer, and KPMG International Global Head of Audit, Bill O’Mara, describe our relentless focus on audit quality.
Message from our Chairman
Welcome to the 20161 KPMG International Transparency Report2, covering our financial year to 30 September 2016. Sharing what we do to continuously advance quality in all we do, manage risk and maintain our independence, is incredibly important to me and to our network’s stakeholders – the Transparency Report is one of the ways we share this information.
In the report, we take the opportunity to provide stakeholders with a succinct description of KPMG’s audit quality initiatives and, notably, how we are:
- Building public trust and inspiring confidence in capital markets, by bringing to life our commitment to quality, ethics and integrity through our culture and values.
- Ensuring that our people are extraordinary, by nurturing talent, creating high-performing teams and deploying talented staff globally to help deliver insights and innovative ideas.
- Driving a relentless focus on quality and excellence in our engagements and providing valued insights, so that clients see a difference in us.
- Driving continuous improvement and getting to the root cause of quality issues.
Audit quality, supported by our methodologies and processes, is at the heart of our culture of integrity and our drive for continuous improvement.
We are committed to working closely with regulators, audit committees, investors and businesses to meet the expectations of audit quality.
1 Unless the context otherwise requires, throughout this document “KPMG” and “KPMG network” (“we”, “our”, and “us”) generally refers to the member firms of the KPMG network of independent firms affiliated with KPMG International, a Swiss entity that services as a coordinating entity for the KPMG network. KPMG International provides no client services.
2 The 2016 KPMG International Transparency Report is set out in two parts – ‘Our relentless focus on quality’ provides some key messages and is supported by a second, more detailed Supplementary Report. Both reports reinforce key messages delivered in the 2016 KPMG International Annual Review.
Our relentless focus on audit quality
Message from Bill O’Mara, Global Head of Audit, KPMG International
At KPMG, we are passionate about audit quality and continuous improvement, and we are united in our commitment to providing independent assurance on what matters to stakeholders. We drive a relentless focus on quality and service excellence and aspire to be the standard of trust in our profession. We recognize that trust is not a ‘given’ – it must be earned.
As part of our commitment to stakeholders – regulators, investors, clients, our people and the public – we aim to be transparent and open in communicating how we address audit quality. In so doing, we help to foster public trust and inspire confidence in KPMG and in the capital markets. We set out KPMG’s audit strategy and vision in the KPMG International Annual Review.
In this report – ‘Our relentless focus on quality’ – we provide further insight into factors that contribute to audit quality as follows:
- Our culture. Audit quality is the responsibility of everyone at KPMG and is driven from the very top by KPMG International and member firms’ leadership. A quality audit means the delivery of an appropriate and independent opinion that is properly supported in compliance with the applicable auditing standards, laws and professional requirements. This means being independent in mind and in appearance and complying with our legal and professional obligations.
- Our people are required to approach all matters in an audit with objectivity and professional skepticism, to offer relevant, valued insight and impartial views through candid communications. We want to increase our added value by demonstrating the skills, behaviors and innovations clients and stakeholders expect. We aim to build and support a dynamic career path for our people.
- Our approach to audit quality includes having globally consistent methodologies and policies, enabled by innovative tools. The expanding role of innovation and technology in audit continues to evolve providing greater clarity and generating deeper and richer insights. Innovation in audit is an area where KPMG continues to invest.
- Our monitoring programs are fundamental to sustaining quality and to building on our successes. We have a number of programs and initiatives primarily aimed at identifying opportunities for continuous improvement and relevant remedial actions.
Who we are
KPMG is a global network of professional services firms providing Audit, Tax and Advisory Services. KPMG International is a Swiss co-operative formed under Swiss law. It licenses the KPMG trademark and conducts activities for the overall benefit of the KPMG network. It facilitates audit quality across the network by establishing common policies, processes and standards to be applied by member firms. It does not provide professional services itself. KPMG member firms – all of which are affiliated with KPMG International – provide professional services to clients and their Heads of Audit have direct responsibility for audit quality. In the more detailed Supplementary Report you can learn more about our global network – its structure and governance, KPMG International’s system of quality control, our values and culture, how audits are performed, our approach to audit quality reviews and our independence policies.
How we are governed
KPMG International has a number of governance bodies: – Global Council – Global Board – Global Management Team. The Global Board is supported by a number of committees, including an Executive Committee. A number of global steering groups support and drive the execution of strategy with a focus on audit quality, including the Global Audit Steering Group (GASG) and the Global Quality & Risk Management Steering Group (GQRMSG). The overall governance structure of KPMG International is discussed in more detail in the Supplementary Report.
About the Transparency and Supplementary Reports
The Transparency Report and Supplementary Report summarize KPMG’s approach to audit quality and our audit quality initiatives. The report may also be useful for stakeholders interested in our Tax and Advisory services, as many KPMG quality control procedures and processes referred to in the Supplementary Report are cross-functional and apply equally to all our services. However, unless otherwise stated both reports focus on what we do to enable KPMG member firms to deliver quality audits.
We lead by example at all levels in a way that exemplifies what we expect of each other and our clients.
We work together to bring out the best in each other and create strong and successful working relationships.
We respect the individual for who they are and for their knowledge, skills and experience as individuals and team members.
We seek the facts and provide insight by challenging assumptions and pursuing facts to provide insight as trusted and objective business advisers.
We are open and honest in our communication and share information, insight and advice frequently, and constructively manage tough situations with courage and candour.
We are committed to our communities to act as responsible corporate citizens by broadening our skills, experience, and perspectives through work in our communities.
Integrity is a critical characteristic that stakeholders expect and rely on.Therefore, above all we act with integrity and are constantly striving to uphold the highest professional standards, provide sound advice and rigorously maintain our independence.
Read more about how our Values create a sense of shared identity within the KPMG organization.
*Unless the context otherwise requires, throughout this document “KPMG” and “KPMG network” (“we”, “our”, and “us”) generally refers to the member firms of the KPMG network of independent firms affiliated with KPMG International, a Swiss entity that services as a coordinating entity for the KPMG network. KPMG International provides no client services.