Difference between revisions of "KPMG"
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In 2013 a report by the influential UK Commons public accounts committee (PAC) found that the Big Four were using knowledge gained from staff seconded to the Treasury "to help wealthy clients avoid paying UK taxes". The firms, it said, went on to "advise multinationals and individuals on how to exploit loopholes around legislation they had helped to write". | In 2013 a report by the influential UK Commons public accounts committee (PAC) found that the Big Four were using knowledge gained from staff seconded to the Treasury "to help wealthy clients avoid paying UK taxes". The firms, it said, went on to "advise multinationals and individuals on how to exploit loopholes around legislation they had helped to write". | ||
| − | PAC committee chair and former Labour minister [[Margaret Hodge]] said the accountancy firms' actions represented a "ridiculous conflict of interest". She called for the Treasury to stop accepting their staff to draw up new tax laws. "The large accountancy firms are in a powerful position in the tax world and have an unhealthily cosy relationship with government," she said.<ref>Rajeev Syal, Simon Bowers and Patrick Wintour, [ | + | PAC committee chair and former Labour minister [[Margaret Hodge]] said the accountancy firms' actions represented a "ridiculous conflict of interest". She called for the Treasury to stop accepting their staff to draw up new tax laws. "The large accountancy firms are in a powerful position in the tax world and have an unhealthily cosy relationship with government," she said.<ref>Rajeev Syal, Simon Bowers and Patrick Wintour, [http://www.guardian.co.uk/business/2013/apr/26/accountancy-firms-knowledge-treasury-avoid-taxAccountancy firms 'use knowledge of Treasury to help rich avoid tax' – MPs] ''The Guardian'', Friday 26 April 2013, acc 12 June 2013 </ref> |
According to Andrew Simms of the New Economics Foundation, "Conflicts of interest are built into the very DNA of the big professional services firms. These companies are working with firms that need to be regulated and the government bodies that are regulating". | According to Andrew Simms of the New Economics Foundation, "Conflicts of interest are built into the very DNA of the big professional services firms. These companies are working with firms that need to be regulated and the government bodies that are regulating". | ||
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*[[Jane McCormick]], Head of Corporate Tax, KPMG. McCormick is a member of the Treasury's [[Tax Professionals Forum]].<ref>HM Treasury, [http://www.hm-treasury.gov.uk/tax_forums_tax_professionals.htm Tax Professionals Forum], accessed April 2011</ref> | *[[Jane McCormick]], Head of Corporate Tax, KPMG. McCormick is a member of the Treasury's [[Tax Professionals Forum]].<ref>HM Treasury, [http://www.hm-treasury.gov.uk/tax_forums_tax_professionals.htm Tax Professionals Forum], accessed April 2011</ref> | ||
*[[Paul Harrison]], Tax Partner and Head of Tax investigations <ref>[http://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/NewsReleases/Pages/UK-Swiss-tax-agreement.aspx UK / Swiss tax agreement – “Tax evaders need to wake up and smell the coffee” says KPMG], news release KPMG, acc 27 Sept 2011 </ref> | *[[Paul Harrison]], Tax Partner and Head of Tax investigations <ref>[http://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/NewsReleases/Pages/UK-Swiss-tax-agreement.aspx UK / Swiss tax agreement – “Tax evaders need to wake up and smell the coffee” says KPMG], news release KPMG, acc 27 Sept 2011 </ref> | ||
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| + | ==Resources== | ||
| + | *[http://www.guardian.co.uk/business/video/2013/apr/26/treasury-insiders-rich-tax-video Treasury insiders help rich avoid tax, say MPs - video], Source: ITN Length: 2min 11secs, 26 April 2013 | ||
==Contact== | ==Contact== | ||
Revision as of 06:38, 17 June 2013
KPMG is one of the world's largest professional services firms and one of the 'Big Four' accountancy firms. In the UK it has over 10,000 partners and staff working in 22 offices.[1]
Just four accountancy firms – PricewaterhouseCoopers, KPMG, Deloitte & Touche and Ernst & Young – audit 97 per cent of FTSE 350 companies[2] and around 99 per cent of the London Stock Exchange's FTSE 100. [3]
Contents
Controversies and conflicts of interest
Secondments to the UK Treasury
In 2013 a report by the influential UK Commons public accounts committee (PAC) found that the Big Four were using knowledge gained from staff seconded to the Treasury "to help wealthy clients avoid paying UK taxes". The firms, it said, went on to "advise multinationals and individuals on how to exploit loopholes around legislation they had helped to write".
PAC committee chair and former Labour minister Margaret Hodge said the accountancy firms' actions represented a "ridiculous conflict of interest". She called for the Treasury to stop accepting their staff to draw up new tax laws. "The large accountancy firms are in a powerful position in the tax world and have an unhealthily cosy relationship with government," she said.[4]
According to Andrew Simms of the New Economics Foundation, "Conflicts of interest are built into the very DNA of the big professional services firms. These companies are working with firms that need to be regulated and the government bodies that are regulating".
Tax avoidance
The Big Four accountancy firms were behind almost half of all known tax avoidance schemes, the UK's HMRC said in 2006.[5]
Prem Sikka, Professor of Accounting at the University of Essex writes:
- "With the aid of accountancy firms, numerous corporate transactions are manufactured for the purpose of avoiding taxes. KPMG has admitted selling "unlawful" tax avoidance schemes that effectively deprived US public funds of billions of dollars. The firm has been fined nearly $500m as a result. Several of its ex-partners face the prospect of criminal prosecutions.
- "The same firms also peddle a range of avoidance schemes in the UK, which are estimated to cost the state £100bn each year in possible tax revenues. KPMG developed a VAT avoidance scheme for a company operating 127 amusement arcades in the UK... The scheme increased the firm's earnings by about £4.2m - about the amount needed to provide 2,500 NHS hip replacements. The ensuing court hearing learned that, in common with its US practices, KPMG cold-called the amusement arcade operator to sell the scheme. The firm produced a 16-page booklet that listed 83 detailed steps necessary to make it work. The firm suspected that Customs might regard the scheme as "unacceptable tax avoidance", but nevertheless sold it. Following a UK court defeat, KPMG and its client took the case to the European court of justice. A preliminary decision by the EU advocate-general has declared the scheme to be "unacceptable"."[6] [7][8]
Political donations and hospitality
In 2010 KPMG ranked equal number one with PwC in a list of top ten companies providing hospitality to senior UK civil servant: both provided hospitality on 72 occasions.[9]
Revolving door
- Jacqui Smith, former Labour Home Secretary became a consultant in October 2010, six months after leaving politics, a position that was cleared by the Advisory Committee on Business Appointments. She held this until June 2011. [10] According to the Daily Mail, KPMG had "won an important government contract while Smith was Home Secretary when it was commissioned to carry out a major study into whether drink industry giants were breaking guidelines on the sale of alcohol". [11]
Lobbying firms
- KPMG Jersey uses Weber Shandwick for its public affairs activities. [12]
Awards
In 2011 KPMG won The Society of Trust and Estate Practitioners (STEP) award for Accountancy Team of the Year. [13]
People
- Jane McCormick, Head of Corporate Tax, KPMG. McCormick is a member of the Treasury's Tax Professionals Forum.[14]
- Paul Harrison, Tax Partner and Head of Tax investigations [15]
Resources
- Treasury insiders help rich avoid tax, say MPs - video, Source: ITN Length: 2min 11secs, 26 April 2013
Contact
Main London offices:
8 Salisbury Square
London, EC4Y 8BB
15 Canada Square
London, E14 5GL
References
- ↑ KPMG websiteWho We Are, UK, accessed April 2010,
- ↑ Prem Sikka, Called to account, The Guardian, 14 December 2008
- ↑ Prem Sikka, Auditors must be held to account, The Guardian, 31 May 2012
- ↑ Rajeev Syal, Simon Bowers and Patrick Wintour, firms 'use knowledge of Treasury to help rich avoid tax' – MPs The Guardian, Friday 26 April 2013, acc 12 June 2013
- ↑ Gilt-edged profits for profession's 'big four', Guardian, 7 February 2009
- ↑ Prem Sikka, Accountants: a threat to democracy, Guardian, 5 September 2005
- ↑ For more on KPMG and tax avoidance see: Sheltering cash: the intricate schemes drawn up by KPMG.
- ↑ The Tax Gap, Sheltering cash: the intricate schemes drawn up by KPMG, Guardian, 7 February 2009
The Tax Gap, series of articles on tax avoidance, The Guardian, 2009.The Tax Gap, Guardian, 2009 - ↑ Bureau for Investigative Journalism, Top ten:Companies, 10 June 2013
- ↑ Jacqui Smith, LinkedIn profile, acc 11 June 2013
- ↑ Geoffrey Levy, Tony's cronies and snouts in the trough: How one-time Labour bigwigs are raking it in thanks to the private sector, 10 June 2011, acc 28 Sept 2011
- ↑ APPG Register May 2012
- ↑ STEP Private Client Awards: Winners for 2011/12, acc 26 Sept 2011
- ↑ HM Treasury, Tax Professionals Forum, accessed April 2011
- ↑ UK / Swiss tax agreement – “Tax evaders need to wake up and smell the coffee” says KPMG, news release KPMG, acc 27 Sept 2011
