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Supervisory Board committees

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The Supervisory Board operates through three committees: Assurance Quality, Audit & Risk and Remuneration and Appointment. The terms of reference for these committees may be found online. Committee meetings may be attended by subject matter specialists, where necessary.

Assurance Quality Committee (AQC)

Responsibilities

  • Overseeing the firm’s system of controls affecting audit quality, independence, integrity and stakeholder / public interest

  • Advising the Board of Management on quality performance

  • Approving its long-term vision and strategy to further improve the approach to quality.

All Supervisory Board members are also members of the AQC; Supervisory Board meetings are held in the presence of Board of Management members.

2020/2021 meetings and other activities

The AQC held six meetings during the year; the main topics discussed were:

  • Recent policy developments in the Dutch accountancy sector (including proposed standards issued by the Quartermasters, Committee on Accountancy Monitoring (MCA) and the Commission on the Future of Accountancy (CTA).

  • KPMG’s North Star project to fully digitalise audit processes

  • Outcomes of Quality Performance and Engagement Quality Control Reviews

  • Annual ratings for the firm’s equity partners with respect to quality

  • (Results from) inspections conducted by the Netherlands’ Authority for the Financial Markets (AFM) and the US Public Company Accounting Oversight Board (PCAOB)

  • Implementation of KPMG Clara workflow (KCw) and the switch to ISQM 1.

“KPMG N.V.’s stated ambition is to be a leader in assurance. Part of this is taking an active role in the public debate in the Netherlands over audit quality. Over the past year, the AQC has provided regular feedback on the government’s reform proposals. Being a leader is also about maintaining the highest possible quality standards. As the AQC, we are very glad to see encouraging improvements over the past year in both internal and external quality measures. This is a reflection, partly, of quality coaching and the hard work of the firm’s Engagement Quality Control Review (EQCR) teams. During the past year, we also oversaw the firm’s progress with its North Star project, and its work with the government on financial support for business during the Covid-19 crisis. Where possible, we urged the Board of Management to be generous with its pricing, particularly for companies hardest hit by the pandemic. At the same time, we were pleased to see new contracts won as part of recent mandatory firm rotations, and the continued roll-out of the KPMG Clara Workflow (KCw), though we realise that KCw will put further pressure on workload - an issue we are monitoring closely, particularly with regard to its possible impact on employee well-being and audit quality.”

Jolande Sap, Chair of Supervisory Board’s Assurance Quality Committee

Audit & Risk Committee (ARC)

Responsibilities

  • Monitoring functioning of the firm’s Enterprise Risk Management framework, as well as compliance with laws and regulations (including GDPR[1])

  • Overseeing financing of operations, financial reporting, the firm’s tax position and use of IT.

  • Advising on accounts, budgets and investments, and monitoring delivery of the Trust & Growth strategy

  • Nominating, selecting, assessing and maintaining dialogue with the external auditor[2]

2020/2021 meetings and other activities

The ARC met seven times in 2020/2021 (in the presence of the Chief Operating Officer (COO), the CFO and the Head of the Internal Audit & Compliance Office; representatives from the external auditor were also present at several meetings, where appropriate). One closed meeting took place involving the ARC and the external auditor. The main topics discussed during the year were:

  • Review of financial performance, tax, insurance, budgets and functioning of both Enterprise Risk Management (ERM) and ‘soft controls’

  • Increased importance of cybersecurity as part of the firm’s overall digital strategy

  • Development of digital assets 

  • Continued improvements in IT General Controls

  • Findings from internal audit and follow-up actions

  • External audit scope, approach and fees, as well as findings from the auditor’s annual management letter[3]

  • Annual accounts and annual integrated report for 2020/2021

  • Monitoring of GDPR

  • 1 EU’s General Data Protection Regulation
  • 2 The external auditor is assessed annually, using the following criteria: professional performance, communications, independence and professional criticism, and expertise /composition of the audit team. The auditor’s independence is also (re)confirmed every year. In its latest assessment, the ARC concluded that BDO Audit & Assurance B.V., the external auditor, met the standards required.
  • 3 In its management letter, BDO Audit & Assurance B.V. did not identify any significant deficiencies in the firm’s internal controls. The ARC took note of remarks made previously concerning IT general controls and discussed with management actions for addressing these remarks.

“Over the past year, we have seen an increase in demand for KPMG N.V.’s services, particularly in the wake of the Covid-19 pandemic. The result was a very strong financial performance for the firm, strengthened by an increase in utilization, most notably in Advisory. At the same time, the ARC is aware of the additional work pressure on employees as a result of this extra demand. We also discussed investment with management, particularly in priority areas, such as digital & innovation. As the ARC, we welcomed the increase in management attention and spending on cybersecurity - an area that we will continue to focus on in the coming year. During 2020/2021, we also saw further improvements in IT General Controls, which in the past has been an area of concern. Over the last year, as usual, we reviewed the firm’s annual accounts, and key findings from the external auditor - we were pleased that the auditor did not identify any significant deficiencies in KPMG N.V.’s internal controls. The ARC also noted that findings from internal and external audit were successfully followed up.”

Gosse Boon, Chair of the Supervisory Board’s Audit & Risk Committee

Remuneration & Appointment Committee (RAC)

Responsibilities

  • Overseeing remuneration, selections and (re)appointments

  • Monitoring compliance with policies in this area

  • Reviewing performance of Board of Management members

  • Advising the Supervisory Board on the appointment or dismissal of external auditors

2020/2021 meetings and other activities

The RAC held six meetings during the year; at these meetings, the principal topics of discussion were:

  • Results of the annual Global People Survey (and follow-up actions)

  • Overview of the firm’s ‘People agenda’, including performance development, culture, and inclusion & diversity

  • Appointment of a new Supervisory Board Chair and one-year extension of Chief Operating Officer’s term

  • Remuneration policy with regard to the firm’s equity partners

  • Effective partnership and talent retention (addressing ‘leaking pipeline’)

  • Strategic workforce management and future skills needs

  • Succession planning (including employability of partners past the age of 62)

“The RAC focused on several important appointments this year - not in the least the new Supervisory Board Chair, Roger van Boxtel, who took over from Bernard Wientjes at the beginning of December 2021. The Committee also worked hard to fill two other positions after Harry van Dorenmalen and René Steenvoorden both ended their terms on the Board. During the year, we also decided on a one-year extension to Rob Kreukniet’s term as the firm’s Chief Operating Officer - we expect to appoint a new COO in 2022. Aside from appointments, the Committee discussed other topics, including the results from the latest Global People Survey and changes to the remuneration policy for equity partners. Considerable attention was also paid to inclusion & diversity. We urged management to step up efforts on gender diversity - to address the ‘leaking pipeline’ issue and increase the number of women at partner-director level. As the RAC, we also discussed future skills needs, the importance of succession planning and the firm’s broader ‘People Agenda’, as well as the challenge the firm faces in retention and recruitment."

Jolande Sap, acting Chair of the Supervisory Board’s Remuneration & Appointment Committee

For further details of committee memberships, please visit our website.