KPMG UK increases partner pay after profit jumps
KPMG UK recorded a double-digit growth in profit before tax over 2024, a better performance than 2023 when it was down nearly 20 per cent, however, its revenue only increased by one per cent.
KPMG UK has reported a double-digit jump in profit before tax in 2024, a sharp reversal on the 20 per cent decline reported for 2023.
While revenue only ticked up one per cent,the Big Four giant’s profit before tax grew 11 per cent in 2024 to £404m for the year ended 30 September 2024, up from £364m recorded in 2023.
Despite the double-digit growth, the overall revenue for the UK arm was up by just one per cent to £2.99bn.
KPMG UK’s tax business grows
The firm reported that its tax and legal business saw “good growth” of nine per cent “in response to increased client demand for advice on changes to tax law and assessing and implementing advances in AI and new technologies”.
While its audit practice grew by five per cent, the firm said it was supported by “its investments in audit quality and AI”.
KPMG International has invested $1.7bn over 2024 on tech and AI, talent and ESG while the UK arm invested £86m.
Despite that, the UK arm of KPMG saw a decrease in advisory sales of four per cent “against a backdrop of depressed UK and global deals markets”.
Against this backdrop, the average partner payouts (for equity partners) rose to £816,000, up from the £786,000 the firm’s equity partners received last year. Last year’s sum comprised £746,000, with an additional £40,000 allocated to partners’ capital accounts.
The bonus pot increased by 20 per cent for staff, excluding partners.
Jon Holt, group chief executive and UK senior partner, said: “This is a good performance in challenging market conditions.”
“Over the past 12 months, our teams have worked incredibly hard to make sure our firm and our clients could adapt, succeed and grow in an uncertain business environment,” he noted.
As the firm works to position itself for “sustainable long-term growth”, it was revealed last year that KPMG UK and KPMG Switzerland were set to merge, the deal completed on 1 October, creating a new $4.4bn business.
Holt added that “merging with KPMG Switzerland has opened up new markets and new client opportunities to create more diverse and exciting career paths for our people.”
Like the other Big Four firms, the firm has cut jobs over the last couple of years, most recently in June when it was reported to be cutting 200 back-office and client-facing roles.
KPMG is the final Big Four firm to publish its results. Peer PwC UK reported single-digit growth in revenue, but the group’s profit and partner pay dropped.
Revenue at Deloitte UK increased slightly by over two per. However, it also reported a decline in profit.
EY UK’s net revenue grew by a single-digit percentage. The group was hit by a reduction in large cross-border transactions, which hit fees.
KPMG also found itself in the headlines this month after the accountancy watchdog announced it had kicked off an investigation into the firm over its audit of gambling giant Entain.