KPMG doubles audit revenues to become largest audit practice in India

04 December 2018 2 min. read
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Despite a particular focus on growing its advisory practice in recent times, global professional services firm KPMG India appears to be doing particularly well in the auditing domain, having doubled its fees over the last financial year to replace Deloitte as the country’s largest audit practice. 

KPMG has been involved in concerted efforts to develop its advisory services in India. In 2016, fellow Big Four accounting and advisory firm Deloitte dealt a strong blow to KPMG’s advisory practice, having poached approximately 20 partners and their entire teams from the latter.

Since then, KPMG has been rebuilding, the most recent indication of which has been the announcement of plans to recruit as many as 9,000 professionals over the next few years, specifically for advisory services for domestic as well as outsourced assignments.

The ability to rebuild its advisory practice has stemmed, among other factors, from the strong performance of its audit practice, which has now emerged as the largest audit practice in India. The position was formerly held by Deloitte, prior to the financial year 2017-2018.

KPMG doubles audit revenues to become largest audit practice in India

KPMG’s income from auditing fees doubled over this period, surpassing a value of Rs. 216 crore, according to statistics from research and information platform Prime Database. The second highest earning auditing practice was the third member of the Big Four – EY – which registered a 64% jump in its audit revenues.

EY earned just over Rs.186 crore over the last financial year, pushing Deloitte down to third position, while PwC rounded off the Big Four with fee earnings of Rs.114 crore. The mammoth earnings from the top firms can primarily be attributed to the large network of firms operating under their overarching brands.

According to Prime Database, however, overall fee levels appear to have dropped recently. “Though the audit fee has gone down due to competition during audit rotation, the Big Four firms have managed to corner a significant chunk of the audit market,” said Pranav Haldea, Managing Director at the firm.

Another firm that registered substantial audit revenues over the last year is accounting and advisory firm Grant Thornton, which earned just over Rs. 52 crore. As per the data, over 1,600 auditing firms in India raked in a cumulative fee revenue of Rs, 2000 crore – a 2% increase from the year before.