Corporate finance fees rise at KPMG

KPMG Peat Marwick, the big six accountancy firm, has confirmed that the UK economy is recovering, albeit slowly, by publishing corporate finance earnings up a fifth and insolvency fees down 4 per cent, writes John Willcock.

KPMG increased its fee income to pounds 491.8m for the year to 30 September, a rise of just under 1 per cent on last year.

Jim Butler, KPMG's senior partner, said the results came against a background of economic uncertainty and fierce competition in the audit and accounting market.

Audit and accounting make up 40 per cent of KPMG's total fee income. Over the year they contributed pounds 197.7m, up 1.3 per cent. The firm was appointed as auditors to Trafalgar House, the shipping and hotels conglomerate, and the drugs company Zeneca. It also became sole auditors of Granada, the leisure and television group.

KPMG claimed it acted in more flotations than any other professional firm, as corporate finance fees rose by 21 per cent to pounds 64.6m. Flotations included Zeneca, Carpetright and the biotechnology group Celltech. The firm also handled several of the biggest corporate bankruptcies, including the Rosehaugh property group.

The continuing pressure to increase productivity also led KPMG to cut its own staff numbers from 9,398 to 8,948 over the year.