Big Four accountancy firm KPMG has warned clients it is planning to substantially increase its audit fees, in order to pay for higher salaries.
The auditor told its clients it plans to increase fees by between 5 per cent and 20 per cent due to facing higher costs linked to new industry rules and the higher costs of staffing, according to Sky News.
The fee hike comes after KPMG gave all 15,800 of its rank-and-file staff pay rises of £2,000 to £4,000, in a move the firm said would cost it £51.7m.
The increases also come as KPMG has faced a series of multi-million-pound fines over a string of major audit scandals.
Most recently, the firm was hit with a £14.4m fine after a group of its auditors misled the UK’s Financial Reporting Council (FRC) during an investigation into KPMG’s audit of collapsed construction giant Carillion.
The Big Four accountant is also facing a £1.3bn claim on behalf of Carillion’s creditors over the 2018 collapse of the Wolverhampton headquartered building firm.
The firm also blamed the fee hikes on the new ISA (UK) 315 rules, as KPMG said it will need to bulk up its audit teams to ensure it complies with the requirements.
KPMG’s increased fees are set to add millions of pounds to the bills served to Britain’s major listed companies, including Barclays, Legal & General, and Reckitt Benckiser.
KPMG have been approached for comment.