KPMG Takes Q1 Auditor Change Crown
KPMG started 2012 off much like they finished 2011: on top of ANR’s SEC auditor change rankings.
The firm finished in first place in ANR’s analysis of the first quarter SEC auditor change data. In taking the top spot, the firm finished no lower than second in any of the five categories that make up the overall score.
ANR’s quarterly auditor change analysis is based on data compiled by AuditAnalytics.com.
KPMG has enjoyed a dominant run in ANR’s SEC rankings of late. The firm finished in first place in ANR’s calendar year 2011, Q4 2011 and Q2 2011 analyses. (See ANR 5, Jan. 30, ANR 2 Jan. 13 and ANR Vol. 1 No. 22 July 28, 2011.)
In addition to its No. 1 ranking in the overall Q1 2012 analysis, KPMG placed first in the accelerated filer category. The firm also place second in the large accelerated filer category.
The numbers underneath the top line of where the firm finished in respective categories can be found in the firm's success at lanbding departing SEC engagements from its Big Four peers.
The firm won the second-most departing Big Four engagements in the quarter, six.
Which groups KPMG won departing clients from in Q1 2012 was close to a reverse image of Q1 2011 when the firm was the undisputed champ at nabbing departing non-Big Four clients.
In Q1 2011, 10 of the firm’s 15 engagement wins in the quarter came from outside the Big Four. (See ANR Vol. 1 No. 13, Apr. 21, 2011.)
This time around it was a different story. In Q1 2012, six of the firm’s 10 wins came from their Big Four brethren.
The average client size, in terms of market cap and revenue audited, of KPMG’s wins in the time period reflects that fact.
In Q1 2012 the average market cap of KPMG’s registrant wins was approximately $878,277,634 and the average annual revenue was approximately $2,182,315,588. In Q1 2011 the average market cap for KPMG’s registrant wins was $460,055,634 and the average annual revenue was approximately $283,346,574. The firm’s Feb. 9 win of SYNNEX Corp. (Revenue: $10.41 billion) was its largest of Q1 and the largest revenue audited win in the Q1 analysis. The firm’s largest asset win of the quarter was First BanCorp. (Assets:$13.13 billion) also from PwC.
Ernst & Young and BDO tied for second in the overall Q1 rankings.
The firms traveled different paths to second place.
E&Y finished first in net gain market cap audited, first in net gain assets audited, second in net gain audit fees, tied for second in net gain engagements and 11th in revenue audited. A large part in determining the rankings for Q1 was the loss of Pilgrim’s Pride ($7.54 billion) to KPMG. Ironically, E&Y’s largest win, in regards to revenue audited, for Q1 was Netflix (Revenue: $3.2 billion) also from KPMG. The firm did have the distinction of scoring the largest asset audited win in the quarterly analysis: Annaly Capital Management (Assets: $109.63 billion) from Deloitte.
In addition to its overall second place finish, the firm also finished first in the large accelerated filer category.
Much like KPMG, E&Y also had success against its Big Four peers when it comes to winning departing Big Four clients, landing seven in Q1.
BDO had a solid quarter in forging its second place tie, finishing with net gains in each of the five categories that go into determining the audit rankings: net client engagement wins, net revenue audited, net assets audited, net market cap audited and net gain audit fees. BDO ranked in the top half of the individual analysis in each of the categories.
Marcum and Grant Thornton rounded out the overall Top 5 in the analysis.
This is an excerpt of the story was published in the April 13, 2012 issue of Accounting News Report.
Published story contained won /loss charts, overall auditor change scorecards and scorecards by SEC registrants.
For more information on Accounting News Report: contact Jonathan Hamilton 702-283-9985.
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