KPMG is a multinational professional services network headquartered in London, England. It is one of the Big Four accounting firms, alongside Deloitte, EY and PwC. As of December 2024, KPMG is operated as a network of 46 firms across 145 countries, employing 275,288 people that are affiliated with KPMG International Limited, a private English company limited by guarantee.
The name "KPMG" stands for "Klynveld Peat Marwick Goerdeler". The initialism was chosen when KMG (Klynveld Main Goerdeler) merged with Peat Marwick in 1987.
KPMG has three main divisions: financial audit, tax, and consulting. Its tax and advisory services are further divided into various service groups. In the 21st century, various firms within KPMG's global network of affiliates have been involved in regulatory actions and lawsuits.
History Early years and mergers
In 1816, Robert Fletcher started working as an accountant, and in 1839 the firm he worked for changed its name to Robert Fletcher & Co.Curtis Jenkins Cornwell & Co: A Study in Professional Origins, 1816-1966, SVP Cornwell, Garland Publishing, 1991 William Barclay Peat joined the firm in 1870 at 17 and became head of the firm in 1891, renamed William Barclay Peat & Co. by then. In 1877, Thomson McLintock founded Thomson McLintock & Co in Glasgow. In 1897, Marwick Mitchell & Co. was founded by James Marwick and Roger Mitchell in New York City. In 1899, Ferdinand William LaFrentz founded the American Audit Company in New York. In 1923, the American Audit Company was renamed FW LaFrentz & Co.
In about 1913, Frank Wilber Main founded Main & Co. in Pittsburgh. In March 1917, Piet Klijnveld and Jaap Kraayenhof opened an accounting firm called Klynveld Kraayenhof & Co. in Amsterdam.
In 1925, William Barclay Peat & Co. and Marwick Mitchell & Co., merged to form Peat Marwick Mitchell & Co. Peat Marwick Mitchell & Co. was based at No. 11 Ironmonger Lane in London, before moving to Puddle Dock in London in 1976.
In 1963, Main LaFrentz & Co was formed by the merger of Main & Co and FW LaFrentz & Co. In 1969, Thomson McLintock and Main LaFrentz merged to form McLintock Main LaFrentz International, and McLintock Main LaFrentz International absorbed the general practice of Grace, Ryland & Co.
In 1979, Klynveld Kraayenhof & Co. (Netherlands), McLintock Main LaFrentz (United Kingdom / United States), and Deutsche Treuhand-Gesellschaft (Germany) formed KMG (Klynveld Main Goerdeler) as a grouping of independent national practices to create a strong European-based international firm. Deutsche Treuhand-Gesellschaft CEO Reinhard Goerdeler became the first CEO of KMG. In the United States, Main Lafrentz & Co. merged with Hurdman and Cranstoun to form Main Hurdman & Cranstoun.
In 1987, KMG and Peat Marwick joined forces in the first mega-merger of large accounting firms and formed a firm called KPMG in the United States and most of the rest of the world and Peat Marwick McLintock in the United Kingdom. From 1984 Peat Marwick was the first, largest, and for some time the only large corporate customer of the Apple Macintosh, and the combined company retained the computer.
In the Netherlands, due to the merger between PMI and KMG in 1988, PMI tax advisors joined Meijburg & Co. (The tax advisory agency Meijburg & Co. was founded by Willem Meijburg, Inspector of National Taxes, in 1939). Today, the Netherlands is the only country with two member firms of KPMG International: KPMG Audit (accountants) and Meijburg & Co (tax consultants).
In 1991, the firm was renamed KPMG Peat Marwick, and in 1999, the name was reduced again to KPMG. In October 1997, KPMG and Ernst & Young announced they would merge. However, while the merger to form PwC was granted regulatory approval, the KPMG/Ernst & Young tie-up was later abandoned.
Recent history
In 2001, KPMG spun off its United States consulting firm through an initial public offering (IPO) of KPMG Consulting, rebranded as BearingPoint. In early 2009, BearingPoint filed for Chapter 11 bankruptcy protection. The UK and Dutch consulting arms were sold to Atos in 2002. In 2003, KPMG divested itself of its legal arm, Klegal and sold its Dispute Advisory Services to FTI Consulting.
KPMG's member firms in the United Kingdom, Germany, Switzerland and Liechtenstein merged to form KPMG Europe LLP in October 2007. These member firms were followed by 15 other countries. The firm appointed John Griffith-Jones and Ralf Nonnenmacher as joint chairmen. In 2008, CollegeGrad.com ranked KPMG as the most preferred employer among the Big Four accounting firms. It was also ranked No. 4 on the list of "50 Best Places to Launch a Career" in 2009 according to Bloomberg Businessweek.
In 2020, KPMG International Limited was incorporated in London, England. In February 2021, Bill Michael resigned as chairman of KPMG UK following criticism of remarks he made during an internal meeting. Bina Mehta, a senior partner, was appointed acting chair, while Mary O'Connor became acting senior partner and chief executive, making her the first woman to lead the firm in the UK. Two months later, O'Connor left the firm after being passed over for the permanent role, which went to Jon Holt.
In November 2021, KPMG UK revised its partnership structure to introduce five tiers of partnership, with required capital contributions ranging from £150,000 to £500,000. This, along with the £115 million proceeds from the sale of its pensions business earlier in 2021, which it seems was not distributed to the partners, was intended to prepare the balance sheet for a potential large fine (up to £1 billion) arising out of the Carillion lawsuit.
In April 2022, it was announced that KPMG will acquire 50% of the UK-based venture capital advisory specialist Acceleris subject to approval from the Financial Conduct Authority. In August 2022, KPMG announced plans to downsize its office footprint in New York City in 2025, when it moves its offices in the city from Midtown Manhattan to Two Manhattan West in Hudson Yards.
In May 2024, KPMG partners approved the merger of its UK and Switzerland firms, which are working across audit, legal, tax, and advisory, and generating $4.4 billion annually.
In November 2024, KPMG announced that it would spend $100 million over the next four years to boost its enterprise artificial intelligence services via a partnership with Alphabet's Google Cloud. This is an attempt to leverage Google products in the workplace, develop AI agents and overall make the workforce familiar with the technology.
In February 2025, KPMG US removed from its website the diversity reports it had been publishing since 2020 as part of a broader effort to abandon the firm's DEI targets.
In April 2026, KPMG announced it was cutting roughly 10% of its U.S. audit partners (around 100 partners) following a multi-year voluntary early retirement push that had fallen short of targets, despite the fact that its U.S. audit business was growing. The firm stated the layoffs were intended to align the size of its partner ranks with the scale of its audit business rather than to address individual performance. At the time, KPMG's U.S. audit practice included about 1,400 partners and managing directors, with managing directors excluded from the cuts.
Global structure Each national KPMG firm is an independent legal entity and is a member of KPMG International Limited, a UK Limited Company incorporated in London, United Kingdom. KPMG International changed its legal structure from a Swiss Verein to a co-operative under Swiss law in 2003Handelsregister des Kantons Zug (Registration Number CH-020.6.900.276-5) and to a limited company in 2020. This structure in which the Limited company provides support services only to the member firms is similar to other professional services networks. The member firms provide the services to the client. The purpose is to limit the liability of each independent member.This is illustrated in the cases involving Parmalat where clients sought to hold Deloitte (the Swiss Verein) and Grant Thornton International (a UK company providing administrative services to its members) liable for the negligence of other member firms. Until September 2026, KPMG's global chairman was Bill Thomas, former senior partner and CEO of Canadian member firm KPMG LLP. He was succeeded by Gary Wingrove. Some KPMG member firms are registered as multidisciplinary entities that also provide legal services in certain jurisdictions. In India, where regulations do not permit foreign auditing firms to operate, KPMG is licensed as an investment bank and carries out audits under the name of BSR & Co, an auditing firm KPMG purchased after the 1992 liberalisation of the Indian economy. During March 2022, in response to the Russian invasion of Ukraine, KPMG announced that their Russian and Belarusian firms would leave the KPMG network.
Services
KPMG is organised into the following three service lines that generated $38.4 billion in revenue (the 2024 revenue shares are listed in parentheses):
Audit ($13.4 billion) Advisory ($16.3 billion) Tax and Legal Services ($8.7 billion)
Tax arrangements relating to tax avoidance and multinational corporations and Luxembourg which were negotiated by KPMG became public in 2014 in the so-called Luxembourg Leaks.
Lawsuits Tax shelter fraud
In 2003, the U.S. Internal Revenue Service issued summonses to KPMG seeking information about certain tax shelters and their investors. In February 2004, the United States Department of Justice (USDOJ) opened a criminal inquiry. The USDOJ accused the U.S. member firm, KPMG LLP, of fraud in marketing tax shelters. KPMG dismissed or required the retirement of more than a dozen partners and employees who were involved. KPMG LLP admitted criminal wrongdoing in creating fraudulent tax shelters to help wealthy clients avoid $2.5 billion in taxes between 1996 and 2002, and agreed to pay $456 million in penalties to avoid indictment. Under the deferred prosecution agreement, KPMG LLP did not face criminal prosecution in exchange for complying with the terms of its agreement. On 3 January 2007, the criminal conspiracy charges against KPMG were dropped.
Microsoft tax evasion In 2012, KPMG brokered a deal for Microsoft with the government of Puerto Rico to give them a tax rate of nearly 0%, allowing Microsoft to sell its intellectual property to a 85-person local factory. It took years for the IRS to unravel the scheme, a "Rube Goldberg machine that channeled at least $39 billion in profits to Puerto Rico".
HBOS audit role The HBOS accounts were published in February 2008 and six months later HBOS had to be rescued by Lloyds Bank. One reason for undertaking an investigation into the audit was that the audit did not reveal the HBOS Reading branch fraud. HBOS, and subsequently Lloyds Bank, accountant Sally Masterton wrote the Project Lord Turnbull Report which described how the Bank and other organizations reacted to the Reading Branch fraud and was highly critical of the firm. However, the audit was investigated by the FRC which concluded, "there was not a realistic prospect that a tribunal would make an adverse finding against KPMG in respect of the matters within the scope of the investigation", and "The firm's work did not fall significantly short of the standards reasonably to be expected of the audit, the test that a tribunal would apply".
Carillion audit role