KPMG Response to Arthur Andersen Canadian Announcement

NEW YORK and LONDON (ots-PRNewswire) - KPMG, the internationalaccounting, tax and consulting firm, made the following statementtoday in response to an announcement by Arthur Andersen regardingKPMG Canada: "We were surprised at Canada's decision, particularly in viewof their continued assurances to us and their partners that theywished to remain part of the KPMG organization -- and given thesignificant progress KPMG International has made towardintegrating all of its member firms globally," said Colin M.Sharman, chairman, KPMG International. He added, however, thatthe Canadian firm's leadership was unwilling to contribute to theinternational firm's global development costs. "We do not believe this action will have any measurable impacton KPMG International," Sharman said. "The incident was fosteredby a leadership that may not be in touch with the interests ofmost Canadian partners." The decision to join Arthur Andersenstill needs to be ratified by the majority of Canadian partners,he added. "We believe their unfortunate decision to join with ArthurAndersen is a consequence of Canada's burdensome unfunded pensionobligation -- as well as their failure to take the proper stepsto rebuild their operations last year," Sharman said. "Canada was the least profitable, on a net income per partnerbasis, of any KPMG member firm in North and South America,"Sharman added. "Ironically, their announced departure removeswhat had been perceived by KPMG as an impediment to consolidationof KPMG's national practices in North America and Latin America.Indeed, their leadership's diminished role in a regional entitymay well have contributed to their decision." Sharman said allof the KPMG national firms in the Americas will soon beintegrated into KPMG LLP, the United States firm. "We're moving ahead quickly in response to today's news. We'vealready opened a dialogue with key practice leaders amongCanada's partners to ensure that the most respected and valuableportions of the entity remain within KPMG International. We willbe aggressive in preserving the practices and the clients thatare most important to KPMG," Sharman said. KPMG LLP is the U.S. member firm of KPMG International. In theU.S., KPMG partners and professionals provide a wide range ofaccounting, tax and consulting services. As a provider ofinformation-based services, KPMG delivers understandable businessadvice -- helping clients analyze their businesses with trueclarity, raise their level of performance, achieve growth andenhance shareholder value. KPMG International's member firms havemore than 6,700 partners and 92,000 professionals in 157countries. KPMG's Web site is http://www.us.kpmg.com. otsOriginal Text Service: KPMG LLP Internet:http://www.newsaktuell.de Contact: George Ledwith of KPMG LLP,201-505-3543 Web site: http://www.us.kpmg.com

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