Statement on the effectiveness of the System of Quality Management of KPMG as at 30 September 2023
As required by the International Auditing and Assurance Standards Board (IAASB)’s, International Standard on Quality Management (ISQM 1) and KPMG International Limited Policy, KPMG N.V. and its subsidiaries (jointly referred to as ‘KPMG’) have responsibility to design, implement and operate a System of Quality Management for audits or reviews of financial statements, or other assurance or related services engagements performed by KPMG.
The objectives of the System of Quality Management are to provide KPMG with reasonable assurance that:
KPMG and its personnel fulfill their responsibilities in accordance with professional standards and applicable legal and regulatory requirements, and conduct engagements in accordance with such standards and requirements; and
Engagement reports issued by KPMG or engagement partners are appropriate in the circumstances.
Integrated quality monitoring and compliance programs enable KPMG to identify and respond to findings and quality deficiencies both in respect of individual engagements and the overall System of Quality Management. The programs include the conduct of an internal review of compliance with the independence regulations and the monitoring that the continuing education policy of the partners, directors and staff of KPMG has been followed.
If deficiencies are identified when we perform our annual evaluation of the System of Quality Management, we evaluate the severity and pervasiveness of the identified deficiencies by investigating the root causes, and by evaluating the effect of the identified deficiencies individually and in the aggregate, on the System of Quality Management, with consideration of remedial actions taken as of the date of the evaluation.
Based on the annual evaluation of KPMG’s System of Quality Management as of 30 September 2023, we identified a deficiency that was evaluated as having an effect on our System of Quality Management that was severe but not pervasive. We evaluated actions taken to address the identified deficiency and concluded that those actions were effective in limiting the effect of the deficiency as of 30 September 2023. Further details in respect of the identified deficiency are included in the PCAOB Order concerning investigation into answer sharing section (new window) of the Integrated report.
As of 30 September 2023, except for matters related to the identified deficiency that has a severe but not pervasive effect, the System of Quality Management provides KPMG with reasonable assurance that the objectives of the System of Quality Management are being achieved.
Amstelveen, 30 November 2023[1]
Stephanie Hottenhuis
CEO of KPMG N.V. and Country Senior Partner
- 1 The statement as of the end of our financial year is dated on 30 November 2023, when we finished our test work and issued the statement in accordance with the instructions of KPMG International.