ESB to replace KPMG as its auditor; ends 90-year relationship
Energy group will open contract to tender in coming months
KPMG’s near 90-year relationship with ESB is set to come to an end, after the energy group said on Monday that it will replace the professional services group as its auditor. (Photograph: Niall Carson/PA Wire)
KPMG’s near 90-year relationship with ESB is set to come to an end, after the energy group said on Monday that it will replace the professional services group as its auditor.
KPMG was first appointed auditor to the semi-state group when it was set up back in 1927, and its contract was renewed in 2012 for three years, and was later extended for a further two years. According to ESB’s annual report however, published on Monday, it will appoint a new auditor from 2017 onwards, in order to “comply with regulatory and best practice requirements”.
In 2014 the European Union introduced new rules on mandatory auditor rotation, requiring larger companies to hire new auditors at 10- to 24 year intervals.
“Taking account of these developments and market practice in the Republic of Ireland and the United Kingdom, a decision was taken to select a new external auditor in the tender process,” ESB chairwoman Ellvena Graham said.
ESB will commence the tendering process in the first half of this year, with shortlisted firms invited to tender thereafter. The new auditor should be appointed by the end of 2016.
It has been a lucrative contract for KPMG. ESB paid KPMG audit fees of €320,000 in 2015, as well as a further €497,000 in assurance and tax and other non-audit fees. While EBS’s audit fee has remained fairly steady since 2008, the boom years did see significantly higher payments: KPMG was paid €724,000 for audit fees alone back in 2008.