KPMG beefed up its staff bonus pool by 20% to £73m (Reuters)
KPMG's bonus pot plumped up on soaring UK profits during 2013, according to the accountancy giant's 2013 report.
Group profit before tax leapt 27% to £455m (€540m, $743m) in the year to 30 September. As a result, KPMG's employee bonus pool jumped 20% to £73m. This is despite marginal revenue growth of 0.4% on the year to £1.81bn.
The firm said the bulk of its profitability came from efficiency savings and better managing its resources, as well as a 4% reduction in headcount. This was the first year in a three year reform programme at KPMG.
"Our performance this year reflects the first phase of our journey to transform KPMG in the UK," said Simon Collins, chairman and
"Our aim is to dominate professional services by becoming so focused on our clients' needs that they always turn to us first, by becoming a magnet for the best and brightest talent, and by acting as a powerful enabler of social change."
PAC and FRC reports
Big accountancy firms have come under fire in 2013 as the row over tax avoidance intensifies.
In April, UK lawmakers on the Public Accounts Committee (PAC) accused the tax office of being in an "unhealthily cosy" relationship with accountancy firms.
The PAC's report attacked the revolving door between them and HMRC, with staff secondments a regular feature between both poachers and gamekeepers.
"The large accountancy firms are in a powerful position in the tax world and have an unhealthily cosy relationship with government," said Margaret Hodge MP, chairwoman of the PAC.
"They second staff to the Treasury to advise on formulating tax legislation. When those staff return to their firms, they have very inside knowledge and insights to be able to identify loopholes in the new legislation and advise their clients on how to take advantage of them. The poacher, turned gamekeeper for a time, returns to poaching.
"This is a ridiculous conflict of interest which should be banned in a code of conduct for tax advisers, as we have recommended to the Treasury and HMRC."
A separate report by accountancy watchdog the Financial Reporting Council (FRC) said some accountants and auditors are not exercising "sufficient professional scepticism" over their clients' financial reporting.
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