KPMG U.K. Partners Remain Lowest Paid of Big Four at £746,000

By Irina Anghel, Bloomberg News (TNS)

KPMG’s U.K. partners made an average of £746,000 ($945,000) last year, but it wasn’t enough for them to avoid being the worst paid of the Big Four accounting firms.

The firm delivered a 4% rise to its 833 U.K. partners, similar to last year’s levels, KPMG said, but it means they remain bottom of the pay table of Big Four firms, as the top audit firms are known. Deloitte LLP’s partners in the U.K. topped the list after earning more than £1 million each on average.

Still, the pay rise comes in the face of shrinking profits, hefty audit fines and job cuts resulting from slowing client demand.

The Big Four firms are cutting costs after a post-COVID boom unraveled and led to clients reining in spending. Last year, it emerged KPMG planned to cut consulting jobs in the U.K., while freezing pay and slashing bonuses for thousands of employees.

Shifting client demand has prompted the firm to combine its deals and consulting practices into one advisory business. It is also planning to merge its U.K. and Swiss businesses to drive up profits.

“Our people have worked exceptionally hard to deliver strong revenue growth against a challenging economic backdrop,” said Jon Holt, chief executive officer at KPMG U.K. “Digitization and emerging technologies are at the forefront of our clients’ minds, and we have the expertise to meet demand and help them gain a competitive edge.”

KPMG U.K. said pretax profit fell by almost a fifth to £364 million in the year through September due to a spike in staff costs. The company’s headcount grew 12% over the period, as it hired over 2,500 people.

At the same time, KPMG saw a decline in attrition, with consultants and accountants clinging to their jobs amid an uncertain economic outlook.

Revenue increased 9% to £2.96 billion due to rising demand for tax advice and AI-fueled productivity gains in the firm’s tax and legal arm. Deal advisory sales fell 6% on the back of the global slowdown in mergers and acquisitions. KPMG had more than 18,120 employees and partners in the U.K. as of October.

Last April, the firm was fined £1.25 million by the U.K. accounting watchdog over its mishandling of a 2016 audit of Luceco Plc.

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