KPMG staffers 'embarrassed' to work at firm after $50m SEC audit fine
28 Jun 2019
Staff at KPMG are 'embarrassed' and some even 'regret their decision to join' the Big Four firm, after the US regulator slammed the firm with a $50m fine for cheating in professional exams and massaging audit results to avoid regulator fallout
28 Jun 2019
Shortly after the news broke that the Big Four firm was being fined a record $50m (£40m) fine for a raft of grave governance issues, from stealing exam papers to changing the outcome of audit findings, the firm’s employees took to professional community app Fishbowl to air their grievances, calling the news ‘embarrassing’, with another employee commenting that it ‘makes me regret my decision’ to join KPMG.
In typical brazen style, some of the contributors brushed off the fine, saying ‘it’s honestly old news. We’re past that and moving forward as a firm. We have no choice but to pay the fine’; another said ‘how does this affect my bonus and raise?’.
This comment raised some reaction on the site. A senior associate responded: ‘That makes it all better! Hope we’re saving up for the next fine display or corporate ethics.’ A consultant said: ‘Unless you’re in audit, relax chief’, and others criticised senior management, saying ‘How have our leaders remained silent about this?’ and ‘it will probably affect us for years to come till the partner protection fund is refilled for the next screw up’.
The scale of the scandal shock the profession and when the sanction was issued, Steven Peikin, co-director of the SEC’s enforcement division, said: ‘The breadth and seriousness of the misconduct at issue here is, frankly, astonishing. This settlement reflects the need to severely punish this sort of wrongdoing while putting in place measures designed to prevent its recurrence.’
The impact of the scandal and record fine has had a negative impact on staff, with survey on professional community forum Fishbowl, finding that three in 10 (29.8%) KPMG employees said the news confirmed their perception of the company, while another third said that the news had changed their perception for the worse. The remaining 40% expressed no opinion on the issue.
A KPMG spokesperson told Accountancy Daily: ‘We have learned important lessons through this experience and we are a stronger firm as a result of the actions we are taking to strengthen our culture, our governance and our compliance program.
When it came to accounting staff from other firms, 54% said the news simply confirmed their perception of the firm, while 46% said the sanction did not alter their views.
The survey ran from 13-18 June and was answered by a total of 650 accounting professionals and 300 KPMG employees. KPMG US has 32,000 staff and the survey was 'a very unfair depiction of people at the firm. It is not an accurate reflection', a source told Accountancy Daily.