KPMG Full Form represents Klynveld, Peat Marwick, and Geordeler. KPMG is a global network of companies that provide tax, audit, and advisory services. The names that are represented by KPMG are the 4 people who connected their individual accounting firms to form this giant global organization. Today, KMPG has grown to become globally popular and operates in over 155 countries.
KPMG provides consistent multidisciplinary services and helps organizations all over the world with regulations, schemes, and financial statements. The tax services take care of both businesses as well as personal concerns on taxation. KMPG also offers advisory services to render help to several organizations and business start-ups in the reconstruction of business, technological innovations, transactions, and handling risky situations. Currently, KMPG has a network around the globe and caters its unique services to almost every industry.
KPMG Full Form – Additional Information
All big companies with large turnovers need their accounts to be audited and maintained for tax purpose. It order to guide the companies to save money on taxes and invest wisely there are chartered accountants and auditors. Major multinationals who have their presence globally have turnovers and profits in millions. Thus, it is essential to appoint a worthy accounting firm that can help them save maximum on taxes and other outgoings. There are 4 big auditors – PricewaterhouseCoopers (PwC), Ernst & Young (EY), Deloitte and Klynveld Peat Marwick Goerdeler (KPMG).
KPMG – THE PEOPLE BEHIND THE COMPANY
K is for Klynveld, one of the partners in the firm. Piet Klynveld started his small accountancy firm in 1917 in Amsterdam, Holland. It was known as Klynveld Kraayenhof & Co.
P is Peat. William Barclay Peat opened an accounting business in London in 1870 under the name of William Barclay Peat & Co. Accounting and money management were in his blood as he was the son of James Peat and Margaret Barclay, from the family of bankers who started the Barclays Bank in England that was considered as the largest bank at that time. Sir William Peat’s great-grandson, Michael Peat, is the trusted aide of Prince Charles and a Treasurer at Buckingham Palace.
M denotes Marwick. In the year 1897 in the city of New York, James Marwick opened an accounting firm named Marwick, Mitchell & Co in collaboration with Roger Mitchell. James Marwick was a qualified Chartered Accountant. However, he chose to sail to first Australia and the Canada to hunt for good business opportunities. He found a conducive environment in North America, where he came across his schoolmate Roger Mitchell in New York and then on the two decided to start the accounting firm Marwick, Mitchell & Co. Later, in 1911, James and Roger teamed up with Sir William Barclay Peat and soon their company was known as Marwick, Mitchell, Peat and Company. After 8 years they broke the partnership and Marwick retired in 1917. Roger Mitchell became the senior partner till 1925. This same year he reunited with William Peat and the firm was renamed Peat, Marwick & Mitchell.
G stands for Goerdeler. Reinhard Goerdeler was the Chairman of Klynveld Main Goerdeler (KMG) company for several years. He also had the distinction of being the first President of the IFA or International Federation of Accountants. In 1987, he brought about the mega-merger of KMG and Peat Marwick International and thus the present KPMG came into existence.
HOW WAS THE COMPANY KPMG FORMED?
William Barclay Peat & Co merged with Marwick, Mitchell & Co in the year 1911 to form what was recognized as a worldwide network of consulting and accounting firms under the name of Peat Marwick International (PMI). In 1979, Piet Klynveld decided to team up Klynveld Kraayenhof & Co (Netherlands). with international professional services company McLintock Main Lafrentz (UK / USA) and Deutsche Treuhand-Gesellschaft (Germany) and formed Klynveld Main Goerdeler (KMG). The aim was to build a company with a strong foothold in Europe and America.
1987 saw the merger of PMI and KMG with the efforts and initiative of Richard Goerdeler. Since then, all the member companies of these two firms adopted the common name of KPMG – Klynveld Peat Marwick Goerdeler. Today, this company has a worldwide presence in the field of accounting, auditing, taxation, investment consultancy, etc. The company has its headquarters in Amsterdam and offices all across the globe. KPMG has not only established its services in Europe but also in the USA and other parts of the world.
SERVICES RENDERED BY KPMG
KPMG is a well-known name as auditors and as mentioned earlier, they have the distinction of being in the group of BIG 4. These four companies (Deloitte, KPMG, Ernst & Young and PricewaterhouseCoopers) are considered the best in providing auditing and accounting services. KPMG also offers consultation for taxation and investments. They have a legal advisory division as well.
- Auditing: Big companies have a sizeable turnover that needs proper accounting and maintenance and thus require the services of good auditors. Audited accounts give details of the company’s business in terms of their investments, profits, losses and market value. This is necessary to be put forth at the annual general meeting in front of the investors and stockholders to give them assurance about the stability and credibility of the company.
- Tax: When there are earnings, there are taxes to be paid. Each country and the state has different tax laws and the accounting firms help steer through the taxation process as they are well versed with the taxation limits, categories, discounts and tax benefits, etc. Every individual, as well as the business house, is expected to abide by the tax laws and pay different types taxes like income, sales, professional, service tax etc. It is the duty of the accountants to see that their clients pay minimum taxes by taking up tax rebate investment options.
- Advisory: KPMG offers consultation in management with respect to customer and operations, financial management, risk consultancy and so on. Under customer and operations, KPMG guides the clients in efficiency in product design, cost reduction techniques, globalization, and establishing good service relation with customers, etc. They also have a consultation for IT security and have an alliance with Microsoft to offer cloud data services.
- Business guidance: There are many talented minds that crave to become good entrepreneurs. However, they fail to have the know-how and nuances to establish a profitable business. This is where KPMG steps in, guiding the person to set up a business and also help him grow it in a right manner. Whether it is a proprietary venture or running a family business, KPMG has solutions for all. Besides setting up and growing the business sometimes there may be a need to diversify for better prospects. KPMG helps to find the right options.
CAREER AT KPMG
KPMG has been nominated many times for the best place to work for. They have dedicated staff that has been with the company for even more than 20 years. There are many career opportunities as well as internship programs at KPMG. The company gives ample scope to deserving candidates to scale their full potential and guides them in their chosen field of finance. After graduation if you wish to make a career in accounting and auditing, then KPMG helps you understand the work better and introduces you to client dealings.
KPMG offers global exposure and internships are placed all around the world that gives the student an opportunity to have a wider experience about different industries. The US branch of the company was voted as one of the top 10 companies favorable for working mothers. In the year 2012, it was estimated that around 9000 employees worked at their mainland China and Hong Kong offices and 11000 worked at the UK branch.
CONTROVERSIES SURROUNDING KPMG
Every successful company has to face some public crisis and legal problems. The same applied to KPMG when some of their clients filed lawsuits against them on various charges. There was an accusation of helping some wealthy clients to avoid taxes to the tune of $2.5 billion and they had to pay the penalty in a court of $456 million. In the year 2006, Fannie Mae sued them for creating false statements of accounts.
In 2007, the German KPMG had been questioned about bribery case related to Siemens company and finally Siemens changed the auditors in favor of Ernst & Young. There are some more cases that put KPMG in legal trouble from time to time. All said and done, every business entity has its positive and negative phases. Even though KPMG has been embroiled on many occasions, they still hold their spot as one of the top accounting firms in the world.