KPMG Pakistan Transparency Report - 2018

kpmg KPMG Taseer Hadi & Co.
Chartered Accountants
KPMG
Pakistan
Transparency
Report - 2018
Contents
Message from Senior Partner 3
1 Who we are 5
1.1 Our business 5

1.2 Our strategy 5
2 Our structure and governance 5
2.1 Legal structure and ownership 5

2.2 Name, ownership and Legal Relationships 5
2.3 Responsibilities and Obligations of member firms 6
2.4 Governance structure 6
3 System of quality control 6
3.1 Tone at the Top 8

3.2 Association with the right clients 11
3.3 Clear standards and robust audit tools 12
3.4 Recruitment, development and assignment of appropriately qualified personnel 18
3.5 Commitment to technical excellence and quality service delivery 21
3.6 Performance of effective and efficient audits 23
3.7 Commitment to continuous improvement 29
4 Public Interest Audit Client 33
5 Financial information 33
5.1 KPMG Network Revenue 33

5.2 KPMGTH Revenue 33
6 Partner remuneration 33
6.1 Partners’ profit share 33

6.2 Drawings 34
7 Network arrangements 34
7.1 Legal Structure 34

7.2 Responsibilities and obligations of member firms 34
7.3 Professional Indemnity Insurance 35
7.4 Governance structure 35
8 Statement by the Board of KPMG Taseer Hadi & Co

on the effectiveness of quality controls and independence 37
9 Appendices 39
A 1. KPMG’s Values 39
A 2. List of KPMG Audit entities located in EU & EEA 40
© 2018 KPMG Taseer Hadi & Co., a Partnership firm registered in Pakistan and a member firm of the KPMG network of
independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
2
Message from Senior Partner
The Transparency Report for the year ended 30 integrity, but the comprehensive approach to
June 2018 is being produced in accordance achieving it that is vital to meeting not only the
with the requirements of Article 40 of the global standards set by KPMG International, but
European Union Statutory Audit Directive. It local professional and ethical standards as well.
contains the process that KPMG Taseer Hadi &
Co. (KPMGTH) follows to uphold its KPMGTH provides a wide range of audit, tax
professional responsibilities and describes the and advisory services to clients. The quality and
legal and governance structure and its integrity of our people and our work is
approach to quality control. KPMGTH is paramount to everything we do. The strength
committed to audit quality and delivering value of our reputation underpins the value which
to its clients in an ethical manner. It provides a using our services adds for our clients.
detailed description of how we demonstrate
not only our commitment to audit quality and Amir Jamil Abbasi
Senior Partner
Throughout this document, “KPMG” (“we,” “our,” and “us”) refers to KPMG International Cooperative
(“KPMG International”), a Swiss entity, and/or to any one or more of the member firms of the KPMG
network of independent firms affiliated with KPMG International. KPMG International provides no client
services.
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4
1 Who we are
Appendix 1 to the KPMG International
1.1 Our business
Transparency Report.
KPMG Taseer Hadi & Co. (KPMGTH) is a KPMGTH is part of a global network of
professional services firm that delivers professional services firms providing
Audit, Tax and Advisory services. We Audit, Tax, and Advisory services to a
operate out of three offices across wide variety of public and private sector
Pakistan and had an average of 1,771 organizations. KPMG International’s
personnel in the year to 30 June 2018 structure is designed to support
(2017: 1,697). consistency of service quality and
adherence to agreed values wherever
Our audit services in Pakistan are its member firms operate.
delivered through KPMGTH. Full details
of the services offered by KPMGTH can KPMGTH is owned by local partners and
be found on our website: is a partnership firm formed under
www.KPMG.com.pk. Partnership Act, 1932 and regulated
under the bye laws of The Institute of
1.2 Our strategy Chartered Accountants of Pakistan
(ICAP).The firm is also registered with
Our strategy is set by the KPMGTH Audit Oversight Board of Pakistan.
Board and has remained consistent for
some time. It has determined that our During the year to 30 June 2018, there
overall ambition remains to be the was an average of 34 Partners /
number one multi-disciplinary Executive Director in KPMGTH (2017:
professional services firm in Pakistan. 33 partners).
The KPMGTH Board has determined Further details about KPMG

that a commitment to ethics and quality International and its business, including
is a priority which is engrained in our our relationship with it, are available in
governance, culture and approach to the supplement to the KPMG
client service. International Transparency Report 2017.
Our strategy is in line with KPMG 2.2 Name, ownership and Legal
International’s strategy which can be Relationships
viewed at KPMGI Transparency Report
2017. KPMG is the registered trademark of
KPMG International and is the name by
2 Our structure and governance which the member firms are commonly
known. The rights of member firms to
2.1 Legal structure and ownership use the KPMG name and marks are
contained within agreements with
KPMGTH is affiliated with KPMG KPMG International.
International Cooperative (“KPMG
International”). KPMG International is a Member firms are generally locally
Swiss cooperative which is a legal entity owned and managed. Each member
formed under Swiss law. It is the entity firm is responsible for its own
with which all the member firms of the obligations and liabilities. KPMG
KPMG network are affiliated. Further International and other member firms
details about KPMG International and its are not responsible for a member firm’s
business activities, including our obligations or liabilities.
relationship with it, are available in
5
Member firms may consist of more than years term. The Board is responsible for
one separate legal entity. If this is the overall management of the partnership
case, each separate legal entity will be including operating and financial
responsible only for its own obligations performance, annual business plans and
and liabilities, unless it has expressly budget, major business proposals,
agreed otherwise. marketing, technology development,
recruitment and retention,
2.3 Responsibilities and Obligations of compensation, nomination and quality,
member firms risk and compliance policies.
Under agreements with KPMG The Board meets on a regular basis

International, member firms are required around the year. The Senior Partner is
to comply with KPMG International’s also the Chairman of the Board. The
policies and regulations including quality Senior Partner is responsible for the day
standards governing how they operate to day management of the Partnership
and how they provide services to clients and dealing with operational matters
to compete effectively. This includes under the overall guidance and direction
having a firm structure that ensures of the Board. The Senior Partner is
continuity and stability and being able to responsible for ensuring that the Board
adopt global strategies, share resources members receive accurate, timely and
(incoming and outgoing), service multi- clear information and ensuring effective
national clients, manage risk, and deploy communication and relationships with
global methodologies and tools. Each the members at large. The Senior
member firm takes responsibility for its Partner also acts as the international
management and the quality of its work. contact partner and represents
Member firms commit to a common set KPMGTH on international forums and to
of KPMG values (see section 3.1). external agencies.
KPMG International’s activities are The Senior Partner has appointed a

funded by amounts paid by member board member as the Risk Management
firms. The basis for calculating such and Ethics and Independence Partner
amounts is approved by the Global who leads a dedicated Risk
Board and consistently applied to the Management Department.
member firms. A firm’s status as a
KPMG member firm and its participation 3 System of quality control
in the KPMG network may be
terminated if, among other things, it has A robust and consistent system of
not complied with the policies and quality control is an essential
regulations set by KPMG International or requirement in performing high quality
any of its other obligations owed to services.
KPMG International.
2.4 Governance structure
KPMGTH apply high standards of

corporate governance.
The Partnership (all partners) elects a

Senior Partner and a Board. The Board
comprises of eight elected members as
well as the Senior Partner. The Board
and Senior Partner are elected for three
6
Accordingly, KPMG International has personnel. This responsibility includes
quality control policies that apply to all the need to understand and adhere to
member firms. These are included in member firm policies and associated
KPMG’s Global Quality & Risk procedures in carrying out their day-to-
Management Manual (Global Q&RM day activities.
Manual) available to all personnel. These
policies and associated procedures are The system of quality control applies to
designed to guide member firms in KPMGTH personnel wherever they are
complying with relevant professional based. While many KPMG’s quality
standards, regulatory and legal control processes are cross-functional,
requirements, and in issuing reports that and apply equally to tax and advisory
are appropriate in the circumstances, as work, the remainder of this section
well as to help member firm personnel focuses on what we do to enable the
act with integrity and objectivity and delivery of quality audits.
perform their work with diligence.
Audit Quality Framework
These policies and procedures are
based on the International Standard on At KPMGTH audit quality is not just
Quality Control 1 (ISQC 1) issued by the about reaching the right opinion, but
International Auditing and Assurance how that opinion is reached. It is
Standards Board (IAASB), and on the about the processes, thought and
Code of Ethics for Professional integrity behind the audit report. The
Accountants issued by the International outcome of a quality audit is the delivery
Ethics Standards Board for Accountants of an appropriate and independent
(IESBA). Both of these are relevant to opinion in compliance with the auditing
firms that perform statutory audits and standards and applicable legal and
other assurance and related services regulatory requirements.
engagements.
To help all audit professionals
KPMGTH implements KPMG concentrate on the fundamental skills
International policies and procedures and behaviours required to deliver a
and adopts additional policies and quality audit, KPMG International
procedures that are designed to address developed the Audit Quality Framework.
rules and standards issued by ICAP and This Framework uses a common
other relevant regulators as well as local language that is adopted by all KPMG
legal and other requirements. member firms including KPMGTH to
describe what the KPMG network
Amendments to risk and quality policies, believes drives audit quality, and to
including ethics and independence highlight how every audit professional at
policies, are included in quality and risk each KPMG member firm contributes to
management alerts and are the delivery of audit quality.
communicated by email.
‘Tone at the top’ sits at the core of the
KPMGTH is required to implement Audit Quality Framework’s seven drivers
changes specified in the email alerts and of audit quality and helps ensure that
this is checked through internal the right behaviours permeate across
monitoring. the entire network. All of the other
drivers are presented within a virtuous
Quality control and risk management are circle, because each driver is intended
the responsibility of all KPMGTH to reinforce the others. Each of the
seven drivers is described in more detail
in the following sections of this report.
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3.1 Tone at the Top We communicate our Values clearly to
our people and embed them into our
people process – induction,
performance development and reward.
. Our Values are considered in the

performance appraisal process that our
people follow and adherence to these
Values is also reviewed when our
people are considered for more senior
promotions, including to Partner. Our
Values are set out in Appendix A1.
Code of conduct
Building on the KPMG Values is the

The culture of KPMG International and
KPMG International Global Code of
the member firms is underpinned by a
Conduct. Member firms, including
strong set of values and supporting
KPMGTH are required to adopt, as a
policies and processes and enables the
minimum, the Global Code of Conduct.
right attitudes and behaviors to
permeate throughout the KPMG
The KPMGTH Code of Conduct
network. At KPMGTH we promote a
incorporates the KPMG Values and
culture in which consultation is
defines the standards of ethical conduct
encouraged and recognized as a
that is required from all KPMG people. It
strength.
sets out core ethical principles and helps
partners and employees at KPMGTH to
Tone at the top means that KPMGTH
understand and uphold those principles.
leadership demonstrates commitment
to quality, ethics and integrity and
In addition, the Code of Conduct
communicates its commitment to
emphasizes that each partner and
clients, stakeholders, and society at
employee is personally responsible for
large.
following the legal, professional, and
ethical standards that apply to his or her
Integrity is a critical characteristic that
job function and level of responsibility.
stakeholders expect and rely on. It is
also the key KPMG Value: “Above all,
The Code of Conduct includes
we act with Integrity”. Integrity means
provisions that require KPMG personnel
constantly striving to uphold the highest
to:
professional standards, providing sound
good-quality advice to our clients and
 comply with all applicable laws,
rigorously maintaining independence.
regulations and KPMGTH policies
Our Values, which have been explicitly
 report any illegal acts, whether
codified for a number of years, are
committed by KPMTH personnel,
embedded into working practices and
clients or other third parties
values-based compliance culture at
KPMGTH. Our values form the
foundation of our culture and set the
 report breaches of KPMG policies
tone at the top. They also form the
 uphold the highest levels of client
foundation of our approach to audit and
confidentiality
shape how we work together.
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 not offer, promise, make, solicit or At KPMGTH, we regularly monitor the
accept bribes (whether directly or extent to which our people feel we live
through an intermediary). our Values through the Global People
Survey (refer to section 3.4.7).
All KPMGTH personnel are required to:
3.1.1 Leadership responsibilities for quality
 confirm their understanding of, and
and risk management
compliance with, the Code of
Conduct upon joining the firm, and
KPMGTH demonstrates commitment to
annually thereafter; and
quality, ethics and integrity, and
communicate their focus on quality to
 complete training on the Code of
clients, stakeholders, and society. Our
Conduct upon joining the firm and
leadership plays a critical role in setting
on a biennial basis thereafter.
the right tone and leading by example -
demonstrating an unwavering
Our personnel are encouraged to raise
commitment to the highest standards of
their concerns when they see behaviors
professional excellence and
or actions that are inconsistent with our
championing and supporting major
Values or professional responsibilities
initiatives.
and required to do so when they see
breaches of KPMG policies, laws and
Our leadership team is committed to
regulations, and professional standards.
building a culture based on quality,
We have procedures and established integrity and ethics, demonstrated
channels of communication so that our through their actions - written and video
personnel can report ethical and quality communications, presentations to
issues and individuals who report in teams and one-to-one discussions.
good faith will not suffer any adverse
impact regardless of whether the The following entities and individuals
concern is ultimately substantiated. have leadership responsibilities for
quality and risk management at
KPMGTH has launched a hotline which KPMGTH.
is available through our intranet to all
personnel. The hotline enables them to In accordance with the principles in
raise any issue or concerns with regard ISQC1, the KPMGTH Board has
to compliance with our Code of Conduct assumed ultimate responsibility for the
and KPMG values directly to the Senior firm’s system of quality control. A key
Partner of the Firm without any fear or aspect of the firm’s culture is a
concern about any retaliation. The commitment to quality. The Board and
hotline has been designed to ensure full Senior Partner help create a culture of
confidentiality and protection of identity quality within the firm through a number
and all issues raised are given top of mechanisms. The quality message is
priority. also reinforced in communications from
leadership including the Senior Partner
In addition, the KPMG International and by explicitly rewarding high-quality
hotline is a mechanism for KPMG work.
partners, employees, clients and other
external parties to confidentially report
concerns they have relating to certain
areas of activity by KPMG International
itself, KPMG member firms or the
senior leadership or employees of a
KPMG member firm.
9
The level of involvement and specific functions within the
responsibility includes: framework set by the Risk
Management Partner. These
 Board and Senior Partner procedures make it clear that at the
engagement level, risk management
The Board and Senior Partner and quality control is ultimately the
approves the establishment of responsibility of all professionals.
quality and compliance procedures
including the compliance with laws, KPMGTH Head of Audit is
rules, regulations, and professional responsible for leading a sustainable
high- quality Audit practice that is
standards. They also monitor the
attractive to KPMG personnel. This
firm’s compliance with these
includes:
procedures on a regular basis.
- setting the right ‘tone at the top’
 Risk Management Partner (RMP)
by demonstrating an unwavering
commitment to the highest
Operational responsibility for the
standards of professional
system of quality control, risk
excellence, including skepticism,
management and compliance in
objectivity, and independence;
KPMGTH has been delegated to the
Risk Management and Ethics and - developing and implementing
Independence Partner who is strategies to monitor and maintain
responsible for setting overall knowledge and skills required of
professional risk management and partners and employees to fulfill
quality control policies and their professional responsibilities;
monitoring compliance for firm. and working with the Risk
Management Partner to monitor
The RMP has a seat on the Board and address audit quality and risk
and has a direct reporting line to the matters as they relate to the audit
Senior Partner. He consults with the practice, including an annual
appointed Area Quality and Risk evaluation of activities considered
Management Leader. The fact that to be key to audit quality.
the role is a Board position, and
 Audit Leadership Team
seniority of the reporting lines,
underlines the importance that the
The National Head of Audit regularly
firm places on risk and quality
interacts with Location Heads of
issues. The RMP is supported by a
Audit about current and emerging
team of partners and professionals
audit quality issues arising from
in each of the functions.
external and internal quality review
processes, queries being raised by
 Audit, Tax and Advisory Functions --
engagement teams, root cause
Function Heads
analysis procedures and other quality
matters identified from a variety of
The location heads of the client
service functions (Audit, Tax and sources. These were debated, other
Advisory) are accountable to the observations collected from client-
Senior Partner for the quality of facing teams were considered, and
service delivered in their respective actions agreed.
functions. Between them, they For more complex issues (which
determine the operation of the risk might require amendments to
management, quality assurance and KPMG’s global audit methodology or
monitoring procedures for their
audit tools) these will be raised with
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KPMG International’s Global Audit involves obtaining and analyzing ‘know
groups for consideration and your client information’ on the
potential development of solutions prospective client, its key management
by the Global Services Centre (GSC) and significant beneficial owners. A key
and the International Standards focus is on the integrity of management
Group (ISG). For more information at a prospective client, and the
about the GSC and the ISG refer to evaluation considers breaches of law
section 3.5.4. and regulation, anti-bribery and
corruption, and ethical business
3.2 Association with the right clients practice, including human rights, among
the factors to consider. A second
partner, as well as the evaluating
partner, approves each prospective
client evaluation. Where the client is
considered to be ‘high risk’, the Risk
Management Partner or experienced
delegate is involved in approving the
evaluation.
3.2.3 Engagement Evaluation
Each prospective engagement is also

evaluated to identify potential risks in
relation to the engagement. A range of
factors are considered as part of this
evaluation, including potential
3.2.1 Acceptance and continuance of clients independence and conflict of interest
and engagements issues (using Sentinel™, KPMG’s
conflicts and independence checking
Rigorous client acceptance and system) as well as factors specific to
continuance policies and processes help the type of engagement.
protect KPMG’s reputation, support our
brand and an important part to our ability For audit services, these include the
to provide high-quality professional competence of the client’s financial
services. Accordingly, KPMG management team and the skills and
international has established policies experience of personnel assigned to
and procedures which all member firms staff the engagement. The evaluation is
have implemented in order to decide made in consultation with other senior
whether to accept or continue a client KPMGTH personnel and includes review
relationship and whether to perform by quality and risk management
specific engagement for a particular leadership, as required.
client.
Where audit services are to be provided
3.2.2 Client and engagement acceptance for the first time, the prospective
process engagement team is required to
perform additional independence
KPMGTH undertake an evaluation of evaluation procedures including a review
every prospective client. This involves of any non-audit services provided to the
an assessment of the prospective client and of other relevant business and
client’s principals, its business, and personal relationships.
other service-related matters. This also
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Similar independence evaluations are 3.2.5 Withdrawal
performed when an existing audit client
becomes a public interest entity or Where we obtain information that
additional independence restrictions indicates that we should withdraw from
apply following a change in the an engagement or from a client
circumstances of the client. relationship, we consult internally and
identify any required legal and regulatory
We follow specific procedures (detailed steps. We also communicate as
further in section Independence required with those charged with
clearance process) to identify and governance and any other appropriate
evaluate threats to independence for authority.
prospective audit clients that are public
interest entities. 3.2.6 Client portfolio management
Depending on the overall risk Location head of functions appoint

assessment of the prospective client or engagement partners who have the
engagement, additional safeguards may appropriate competence, capabilities,
be introduced to help mitigate the time and authority to perform the role
identified risks. Any potential for each engagement.
independence or conflict of interest
issues are required to be documented 3.3 Clear standards and robust audit
and resolved prior to acceptance. tools
A prospective client or engagement will

be declined if a potential independence
or conflict issue cannot be resolved
satisfactorily in accordance with
professional standards and our policies,
or if there are other quality and risk
issues that cannot be appropriately
mitigated.
3.2.4 Continuance process
KPMGTH undertakes an annual re-

evaluation of all its audit clients. The re-
evaluation identifies any issues in
relation to continuing association and
any mitigating procedures that need to All KPMGTH professionals are expected
be put in place (this may include the to adhere to KPMG International and
assignment of additional professionals KPMGTH policies and procedures
such as an Engagement Quality Control (including independence policies), and
(EQC) reviewer or the need to involve are provided with a range of tools and
additional specialists on the audit). guidance to support them in meeting
these expectations. The policies and
Recurring or long running non-audit
procedures set for audit incorporate the
engagements are also subject to re-
relevant requirements of accounting,
evaluation.
auditing, ethics, and quality control
In addition, clients and engagements are standards, and other relevant laws and
required to be re-evaluated if there is an regulations.
indication that there may be a change in
their risk profile.
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3.3.1 Audit methodology and tools KAM includes the implementation of
quality control procedures at the
Significant resources are dedicated to engagement level that provide us with
keeping our standards and tools reasonable assurance that engagements
complete and upto date. The global comply with the relevant professional,
audit methodology, developed by the legal, and regulatory and KPMG
Global Service Centre (GSC), is based on International policy requirements.
the requirements of the International
Standards on Auditing (ISAs). The global The policies and procedures set out in
audit methodology is set out in KPMG KAM are specific to audits and
International’s Audit Manual (KAM) and supplement the policies and procedures
includes additional requirements that go set out in the Global Q&RM Manual that
beyond the ISAs, which KPMG is applicable to all KPMG member firms,
International believes enhance the functions and personnel.
quality of the audit. KPMG member
firms may add local requirements and/or 3.3.2 Independence, integrity, ethics and
guidance in KAM to comply with objectivity
additional professional, legal, or
regulatory requirements. Overview
The global audit methodology is KPMG International have detailed

supported by eAudIT, KPMG independence policies and procedures,
International’s electronic audit tool, incorporating the requirements of the
which provides KPMGTH auditors with IESBA Code of Ethics. These are set out
the methodology, guidance, and in KPMG’s Global Q&RM Manual.
industry knowledge needed to perform Automated tools facilitate compliance
efficient, high-quality audits. with these requirements.
e-AudIT’s activity-based workflow These policies are supplemented by

provides engagement teams with ready other processes to ensure compliance
access to relevant information at the with the standards issued by The
right time throughout the audit, thereby Institute of Chartered Accountants of
enhancing effectiveness and efficiency Pakistan (ICAP), Securities and
and delivering value to stakeholders. Exchange Commission of Pakistan
(SECP) and other regulatory authorities.
KAM contains examples and guidance
for, among other things, procedures These policies and processes cover
intended to identify and assess the risk areas such as firm independence
of material misstatement and (covering, for example, treasury and
procedures to respond to those procurement functions), personal
assessed risks. independence, firm financial
relationships, post-employment
The global audit methodology relationships, partner rotation and
encourages use of specialists when approval of audit and non-audit services.
appropriate, and also requires
involvement of relevant specialists in KPMG International has a Partner-in-
the core audit engagement team when Charge of the Global Independence
certain criteria are met or where the Group, who is supported by a core team
audit team considers it appropriate or of specialists to help ensure that robust
necessary. and consistent independence policies
and procedures are in place at KPMG
member firms, and that tools are
13
available to help them and their complying with personal independence
personnel comply with these investment policies. This system
requirements. contains an inventory of publicly
available investments.
KPMGTH’s RMP is also the Ethics and
Independence Partner (EIP) of the firm Partners and all client-facing personnel
who has primary responsibility for the who are manager grade or above are
direction and execution of ethics and required to use the KICS system prior to
independence policies and procedures entering into an investment to identify
in KPMGTH. whether they are permitted to do so.
They are also required to maintain a
Amendments to KPMG International’s record of all of their investments in
ethics and independence policies in the KICS, which automatically notifies them
course of the year are included in if their investments subsequently
regular quality and risk communications. become restricted and they must
Member firms are required to dispose of that investment within five
implement changes as specified in the business days of the notification. We
email alerts, and this is checked through monitor partner and manager
the internal monitoring programs compliance with this requirement as
described in section 3.7.1. part of our program of independence
compliance audits of a sample of
KPMGTH personnel are required to professionals.
consult with the EIP on certain matters
as defined in the Global Q&RM Manual. In 2018 over 48 of our people were
subject to these audits (this included
Personal financial independence approximately 39% of our
partners/executive director).
KPMG International policies require that
each KPMG member firm and its Employment Relationships
professionals are free from prohibited
financial interests in, and prohibited Any professional providing services to
relationships with, KPMG’s audit clients, an audit client irrespective of function is
their management, directors, and required to notify our EIP if they intend
significant owners. The policies also to enter into employment negotiations
extend the IESBA Code of Ethics with that audit client. For partners, this
restrictions on ownership of audit client requirement extends to any audit client
securities to every KPMG member firm of any KPMG member firm that is a
partner in respect of any audit client of public interest entity.
any member firm.
Former members of the audit team or
KPMGTH professionals are responsible former partners of KPMGTH are
for making appropriate inquiries and prohibited from joining an audit client in
taking other appropriate actions on an certain roles unless they have
ongoing basis to ensure that they do not disassociated from the member firm
have any personal financial, business or financially and have ceased participating
family interests that are restricted for in KPMGTH business or professional
independence purposes. activities.
In common with other KPMG member Key audit partners and members of the
firms, we use a web-based chain of command for an audit client
independence compliance system that is a public interest entity are subject
(KICS) to assist our management staff in to time restrictions (referred to as
14
‘cooling-off’ periods) that preclude them Independence training and confirmations
from joining that client in certain roles
until a defined period of time has KPMGTH provide all relevant personnel
passed. (including all Partners and client service
professionals) with independence
We communicate and monitor training that is appropriate to their grade
requirements in relation to employment and function on an annual basis. New
of KPMGTH professionals by audit personnel who are required to complete
clients. this training must do so by the earlier of;
Firm financial Independence a) thirty days after joining KPMGTH or,
KPMGTH also use KICS to record their b) before providing any services to, or
own investments in SEC entities and becoming a member of the chain of
affiliates (including funds), and in locally command for, any audit client,
listed companies and funds, direct and including any of its related entities
material indirect investments held in or affiliates.
pension, and employee benefit plans
(including non-public entities and funds). We also provide all personnel with
training on the Code of Conduct and
Additionally, KPMGTH is required to ethical behavior, including KPMG’s anti-
record in the system all borrowing and bribery policies, compliance with laws,
capital financing relationships, and regulations, and professional standards,
custodial, trust and brokerage accounts and reporting suspected or actual non-
that hold member firm assets. compliance with laws, regulations,
professional standards, and KPMG’s
On an annual basis, KPMGTH confirms policies on a biennial basis. New
compliance with independence personnel are required to complete this
requirements as part of the Risk training within 3 months of joining the
Compliance Program. firm.
Business relationships / suppliers In addition, certain non-client-facing

personnel who work in finance,
KPMGTH has policies and procedures in procurement or sales and marketing
place that are designed to ensure their departments, and who are at the
business relationships are maintained in manager level and above, are also
accordance with the IESBA Code of required to undertake anti-bribery
Ethics and other applicable training.
independence requirements.
Upon acceptance of employment, all
Independence Clearance process KPMG personnel are required to confirm
that they are in compliance with, and
KPMGTH follow specific procedures to will abide by applicable ethics and
identify and evaluate threats to independence rules and policies.
independence related to prospective Thereafter, all KPMG personnel are
audit clients that are public interest required to sign an annual confirmation
entities; these procedures, also referred stating that they have remained in
to as ‘the independence clearance compliance with applicable ethics and
process,’ must be completed prior to independence policies throughout the
accepting an audit engagement for year covered by the confirmation as well
these entities. as their understanding of, and
compliance with, the applicable Code of
15
Conduct. This confirmation is used to proposed service for those entities
evidence the individual’s compliance worldwide.
with and understanding of KPMG’s
independence policies. Fee dependency
Non-audit services KPMG International’s policies recognize

that self-interest or intimidation threats
We have policies which are consistent may arise when the total fees from an
with IESBA principles and applicable audit client represent a large proportion
laws and regulations, the “list of of the total fees of the operating firm
prohibited services” issued by ICAP, the expressing the audit opinion. In
Code of Corporate Governance particular, KPMG International’s policies
contained in Listing Regulations and require that in the event that the total
with other applicable laws and fees from a public interest entity audit
regulations, which address the scope of client and its related entities were to
services that can be provided to audit represent more than 10% of the total
clients. fees received by a particular member
firm for two consecutive years,
We are required to establish and
maintain a process to review and  this would be disclosed to those
approve all new and modified services charged with governance at the
that are developed by the KPMGTH. audit entity.
KPMGTH’s EIP is involved in the review
of potential independence issues, and  a senior partner from another
the Global Independence Group is operating firm would be appointed
involved in the case of services as the engagement quality control
developed which are intended to be reviewer
delivered to audit or assurance clients in
more than one jurisdiction. No audit client accounted for more than
10% of the total fees received by our
In addition to identifying potential firm over the last two years.
conflicts of interest, SentinelTM,
facilitates compliance with these Conflicts of interest
policies. Certain information on all
prospective engagements that includes Conflicts of interest can arise in
service descriptions and fees must be situations where KPMG personnel have
entered into Sentinel™ as part of the a personal connection with the client
engagement acceptance process. Using which may interfere, or be perceived to
Sentinel™ lead audit engagement interfere, with their ability to remain
partners are required to maintain group objective, or where they are personally
structures for their publicly traded and in possession of confidential information
certain other audit clients as well as relating to another party to a transaction.
their affiliates, and identify and evaluate Consultation with the Risk Management
any independence threats that may arise Partner or the Ethics and Independence
from the provision of a proposed non- Partner is required in these situations.
audit service and the safeguards
available to address those threats. All KPMG member firms and personnel
Sentinel™ enables lead audit are responsible for identifying and
engagement partners for entities for managing conflicts of interest, which are
which group structures are maintained, circumstances or situations that have, or
to review and approve, or deny, any may be perceived by a fully informed,
reasonable observer, to have an impact
16
on a member firm or its personnel in professionals and applies to all breaches
their ability to be objective or otherwise of independence rules, incorporating
act without bias. incremental sanctions reflecting the
seriousness of any violations. Any
All KPMG member firms must use breaches of auditor independence
Sentinel™ for potential conflict regulations are reported to those
identification so that these can be charged with governance at the audit
addressed in accordance with legal and client, on the basis agreed with them.
professional requirements.
Matters arising are factored into
KPMGTH has risk management promotion and compensation decisions
resource/s (‘Resolver/s’) who are/is and, in the case of engagement leaders
responsible for reviewing an identified and managers, are reflected in their
potential conflict and working with the individual quality and risk metrics.
affected member firms to resolve the
conflict, the outcome of which must be Compliance with laws, regulations, and
documented. It may be necessary to anti-bribery and corruption
apply specific procedures to manage the
potential for a conflict of interest to Compliance with laws, regulation and
arise, or be perceived to arise, so that standards is a key aspect for all
the confidentiality of all clients’ affairs is KPMGTH personnel. In particular,
maintained. Such procedures may, for KPMGTH has zero tolerance of bribery
example, include establishing formal and corruption.
dividers between engagement teams
serving different clients, and making We prohibit involvement in any type of
arrangements to monitor the operation bribery - even if such conduct is legal or
of such dividers permitted under applicable law or local
practice. We also do not tolerate bribery
Escalation and dispute resolution by third-parties, including by our clients,
procedures are in place for situations in suppliers or public officials.
which agreement cannot be reached on
how to manage a conflict. If a potential Further information on KPMG
conflict issue cannot be appropriately International anti-bribery and corruption
mitigated, the engagement is declined can be found on the anti-bribery and
or terminated. corruption site.
Breaches of independence policy
All KPMGTH personnel are required to

report an independence breach as soon
as they become aware of it. In the event
of failure to comply with the
independence policies, whether
identified in the compliance review, self-
declared or otherwise, professionals are
subject to an independence disciplinary
policy.
KPMGTH has a documented disciplinary

policy in relation to breaches of
independence policies. The disciplinary
policy is communicated to all
17
Partner and firm rotation 3.4 Recruitment, development and
assignment of appropriately qualified
Partner rotation personnel
KPMG International rotation policies are

consistent with the IESBA Code of
Ethics and require our firm to comply
with any stricter applicable rotation
requirements.
KPMGTH partners are subject to

periodic rotation of their responsibilities
for audit clients under applicable laws,
regulations, independence rules and
KPMG International policy. These
requirements place limits on the number
of consecutive years that partners in
certain roles may provide statutory audit
services to a client, followed by a “time- One of the key drivers of quality is
out” period during which time these ensuring that our professionals have the
partners may not participate in the audit, appropriate skills and experience,
provide quality control for the audit, passion and purpose, to deliver the
consult with the engagement team or highest quality in audit. This requires
the client regarding technical or industry- appropriate recruitment, development,
specific issues or in any way influence promotion, retention and assignment of
the outcome of the audit. professionals. KPMG global behaviors,
which are linked to the KPMG Values,
KPMGTH monitor the rotation of audit are designed to articulate what is
engagement leaders (and any other key required for success — both individually
roles, such as the Key Audit Partner and and collectively. One of KPMG’s global
EQC Reviewer, where there is a rotation behaviors is ‘Delivering Quality’.
requirement) and develop transition
plans to enable allocation of partners 3.4.1 Recruitment
with the necessary competence and
capability to deliver a consistent quality KPMGTH strives to be an employer of
of service to clients. The partner rotation choice by creating an environment
monitoring is done by risk management where our people can fulfill their
team. potential and feel proud and motivated
to give their best.
Firm rotation
Our recruiting strategies are focused on
As per the local regulatory requirement drawing entry-level talent from a broad
KPMGTH can act as statuary auditor of a talent base, including working with
financial institute for maximum period of established universities, colleges and
5 years subject to 3 years cooling off business schools.
period.
All candidates submit an application and
are employed following a variety of
selection processes, which may include
application screening, competency-
based interviews, and
qualification/reference checks.
18
KPMGTH recruited over 166 new people leadership at KPMGTH and across the
in the year ended 30 June 2018 (2017: KPMG network.
approximately 145).
For more about Inclusion & Diversity at
Where individuals are recruited for KPMG International and its member
senior grades. A formal independence firms read here.
discussion is conducted with them by
the Ethics and Independence Partner or 3.4.4 Evaluation process including quality and
a delegate. KPMGTH does not accept compliance metrics,
any confidential information belonging to
the candidate’s former firm/employer. KPMGTH professionals, including
partners have annual goal-setting and
3.4.2 Personal development
performance reviews. Each professional
is evaluated their agreed-upon goals,
It is important that all our professionals
demonstration of our global behaviours,
have the necessary business and
technical capabilities and market
leadership skills in addition to technical
knowledge.
skills to be able to perform quality work.
(Section 3.5.1). In relation to the audit,
A culture of continuous improvement is
opportunities are provided for
encouraged to drive feedback, both
professionals to develop the skills,
positive and developmental, from both
behaviors, and personal qualities that
junior and senior colleagues, as well as
form the foundations of a successful
peers. Feedback gathered forms an
career in auditing. Courses are available
integral part of performance reviews.
to enhance personal effectiveness and
develop technical, leadership, and
Going beyond performance reviews and
business skills.
compensation, the KPMG Global
Behaviours are designed to extend
KPMGTH professionals are also
across all our people processes,
developed for high performance through
including recruitment methodologies,
access to coaching and mentoring on
recognition approaches and
the job, stretch assignments, and
development planning. The behaviours
country rotational and global mobility
are a constant reference point,
opportunities.
articulating to our people what is
required for success individually and
3.4.3 Inclusion and Diversity programs
collectively.
KPMGTH work hard to foster an
KPMGTH monitors quality and
inclusive culture. Being inclusive
compliance incidents and maintain
enables us to bring together successful
quality metrics in assessing overall
teams with the broadest range of skills,
evaluation, promotion and remuneration
experiences and perspectives.
of partner and certain personnel. These
evaluations are conducted by
Leadership and management teams also
performance managers and partners
need to reflect the diversity within our
who are in a position to assess
firm and the diversity of our clients. We
performance.
believe that the established Global
Inclusion and Diversity strategy of
KPMGTH’s policy prohibits audit
KPMG International provides the
partners from being evaluated on or
framework to drive the actions that are
compensated based on their success in
necessary to promote inclusive
selling non-assurance services to audit
clients.
19
Reward Function heads are responsible for the
partner assignment process. Key
We have compensation and promotion considerations include partner
policies that are clear, simple, and linked experience, and capacity, based on an
to the performance evaluation process, annual partner portfolio review, to
which for partners includes the perform the engagement in view of the
achievement of key audit quality and size, the complexity and risk profile of
compliance metrics. This helps our the engagement and the type of support
partners and employees know what is to be provided (i.e., the engagement
expected of them and what they can team composition and specialist
expect to receive in return. involvement).
Reward decisions are based on Audit engagement partners are required

consideration of both individual and to be satisfied that their engagement
organizational (member firm) teams have appropriate competencies,
performance. The extent to which our training and capabilities including time,
people feel their performance has been to perform audit engagements in
reflected in their reward is measured accordance with KAM, professional
through the Global People Survey, with standards and applicable legal and
action plans developed accordingly regulatory requirements. This may
include involving specialists from our
Promotion own KPMG member firms.
The results of performance evaluations When considering the appropriate

directly affect the promotion and competence and capabilities expected
remuneration of partners and staff and, of the engagement team as a whole,
in some cases, their continued the engagement partner’s
association with KPMG. considerations may include the
following:
3.4.5 Partner admissions
 an understanding of, and practical
Our process for admission to experience with, audit engagements
partnership is rigorous and thorough, of a similar nature and complexity
involving appropriate members of through appropriate training and
leadership. Our criteria for admission to participation
the partnership are consistent with our
commitment to professionalism and  an understanding of professional
integrity, quality, and being an employer standards and legal and regulatory
of choice. These are strongly aligned to requirements
KPMG’s behavioural capabilities and are
based on consistent principles.  appropriate technical skills, including
those related to relevant information
3.4.6 Assignment of personnel technology and specialized areas of
accounting or auditing
KPMGTH has procedures in place to
assign both the engagement partners  knowledge of relevant industries in
and other professionals to a specific which the client operates
engagement on the basis of their skill
sets, relevant professional and industry  ability to apply professional
experience, and the nature of the judgment, and
assignment or engagement.
20
 an understanding of KPMG’s quality 3.5 Commitment to technical excellence
control policies and procedures. and quality service delivery
 QPR results and results of

regulatory inspections
3.4.7 Insight from our people – Global People

Survey (GPS)
Annually KPMGTH invite all its people to

participate in an independent Global
People Survey (GPS) which measures
there overall level of engagement with
the firm. The GPS provides an overall
Employee Engagement Index (EEI) and
Performance Excellence Index (PEI) as
well as insights into areas driving
engagement which may be strengths or
opportunities. The survey also identifies
opportunities to strengthen those levels
of engagement. Results can be
analyzed by functional or geographic All KPMGTH professionals are provided
area, grade, role, gender to provide with the technical training and support
additional insight. Additional insight is they need. This includes access to
provided on how we are faring on networks of specialists and professional
categories known to impact employee practice departments (“DPP”), which
engagement. are made up of senior professionals
with extensive experience in audit,
The survey also specifically provide reporting and risk management, either
leadership with information on to provide resources to the engagement
employee and partner attitudes to team or for consultation.
quality, leadership and tone at the top.
Where the right resource is not available
KPMGTH participate in the GPS, monitor within KPMGTH professionals, access is
results and take appropriate actions to provided to a network of highly skilled
communicate and respond to the KPMG professionals in other KPMG
findings of the survey. member firms.
This includes monitoring GPS results At the same time, audit policies require
including those related to audit quality professionals to have the appropriate
and tone at the top, referred to in the knowledge and experience for their
GPS as ‘leadership behavior’, and assigned engagements.
employee engagement through the EEI,
and employee performance through PEI. 3.5.1 Lifetime learning strategy
The results of the GPS are also In addition to personal development

aggregated for the KPMG network and discussed at 3.4.2, our lifetime learning
are presented to the Global Board each strategy is underpinned by policies
year and appropriate follow-up actions requiring all professionals to maintain
agreed. their technical competence and to
comply with applicable regulatory and
professional development requirements.
21
Formal Training working on IFRS engagements in
countries where IFRS is not the
Annual training priorities for predominant financial reporting
development and delivery are identified framework. Similar policies apply to
by the Audit Learning and Development engagements performed outside the
steering groups at global, regional and, U.S. to report on financial statements or
where applicable, KPMGTH. Training is financial information prepared in
delivered using a blend of classroom, accordance with U.S. GAAP and/or
digital learning and performance support audited in accordance with U.S. auditing
to assist auditors on the job. Audit standards, including reporting on the
Learning and Development teams work effectiveness of the entity's internal
with subject matter experts and leaders control over financial reporting (ICOFR).
from the GSC, the ISG and member These require that the partner, manager,
firm Department of Professional and EQC reviewer have completed
Practice (DPP) as appropriate, to ensure relevant training and that the
the training is of the highest quality, is engagement team, collectively, has
relevant to performance on the job and sufficient experience to perform the
is delivered on a timely basis. engagement or has implemented
appropriate safeguards to address any
Mentoring and on the job training shortfalls.
Learning is not confined to the 3.5.3 Access to specialist networks

classroom, rich learning experiences are
available at the moment of need KPMGTH engagement teams have
through coaching and just- in- time access to a network of local KPMG
learning, available at the click of a specialists or specialists in other KPMG
mouse and aligned with job specific role member firms. Engagement partners
profiles and learning paths. All are responsible for ensuring that their
classroom courses are reinforced with engagement teams have the
appropriate performance support to appropriate resources and skills.
assist auditors on the job.
The need for specialists (e.g.
3.5.2 Licensing and mandatory requirements Information Technology, Tax, Treasury,
for IFRS and U.S. GAAP engagements Actuarial, Forensic, Valuation) to be
assigned to a specific audit engagement
All KPMGTH professionals are required is considered as part of the audit
to comply with applicable professional engagement acceptance and
license rules and satisfy the Continuing continuance process.
Professional Development (CPD)
requirements in the jurisdiction where Specialists who are members of an
they practice. Policies and procedures audit team and have overall
are designed to facilitate compliance responsibility for specialist involvement
with license requirements. We are on an audit engagement have the
responsible for ensuring that audit competencies, capabilities and
professionals working on engagements objectivity to appropriately fulfill their
have appropriate audit, accounting and role. Training on audit concepts is
industry knowledge, and experience in provided to these specialists.
the local predominant financial reporting
framework 3.5.4 Consultation
In addition, we have specific KPMGTH promotes a culture in which

requirements for partners and managers consultation is recognized as a strength
22
and that encourages personnel to Further details about the GSC and ISG
consult on difficult or contentious and its activities are available in the
matters. To assist audit engagement supplement to the KPMG International
professionals in addressing difficult or Transparency Report 2017.
contentious matters, protocols have
been established for consultation and 3.5.5 Developing business understanding and
documentation of significant accounting industry knowledge
and auditing matters, including
procedures to facilitate resolution of A key part of engagement quality is
differences of opinion on engagement having a detailed understanding of the
issues. In addition, our Global Q&RM client’s business and industry.
Manual includes mandatory consultation
requirements where certain matters are For significant industries global audit
identified such as concerns over client sector leads are appointed to support
integrity the development of relevant industry
information which is made available to
Appropriate consultation support is audit professionals within eAudIT. This
provided to audit engagement knowledge comprises examples of
professionals through professional industry audit procedures and other
practice resources. information (such as typical risks and
accounting processes). In addition,
Auditing and technical accounting industry overviews are available which
support is available to all member firms provide general and business
and their professionals through the information in respect of particular
GSC, MESA DPP (for MESA countries industries as well as a summary of the
only), the International Standards Group industry knowledge provided in eAudIT.
(ISG) as well as the US Capital Markets
Group for work on SEC foreign
registrants.
3.6 Performance of effective and efficient
Global Services Centre (GSC) audits
The GSC develops, maintains and

deploys KPMG’s global audit
methodology and technology-based
tools used by KPMG audit professionals
to facilitate effective and efficient
Audits.
International Standards Group (ISG)
The ISG works with Global IFRS and

ISAs topic teams with geographic
representation from around the world to
promote consistency of interpretation of
IFRS between member firms, identify 3.6.1 KPMG Audit Process
emerging issues, and develop global
guidance on a timely basis. Our audit workflow is enabled through
eAudIT, KPMG International’s activity
based workflow and electronic audit file.
eAudIT integrates the KPMG audit
23
methodology, guidance and industry partner to identify and appropriately
knowledge, and the tools needed to address matters significant to the
manage audits consistently. Our high- engagement, including critical areas of
quality audit process includes: judgment, and significant risks.
 timely partner and manager The engagement partner is responsible

involvement for the final audit opinion and, reviews
key audit documentation – in particular,
 timely access to the right documentation relating to significant
knowledge – specialists, accredited matters arising during the audit and
individuals and relevant industry conclusions reached. The engagement
expertise manager assists the partner in meeting
these responsibilities and in the day–to-
 critical assessment of audit day liaison with the client and team,
evidence— exercise of professional building a deep business understanding
judgment and professional that helps the partner and team deliver
skepticism valued insights.
 ongoing mentoring, supervision, and Critical assessment of audit evidence

review with emphasis on professional
skepticism
 appropriately supported and
documented conclusions We consider all audit evidence obtained
during the course of the audit, including
 Robust challenge and review, consideration of contradictory or
including EQC review. inconsistent audit evidence. The nature
and extent of the audit evidence we
Timely partner and manager gather is responsive to the assessed
involvement risks. We critically assess audit
evidence obtained from all sources. For
To help identify and respond to the the purpose of obtaining sufficient
significant audit risks applicable to each appropriate audit evidence each team
audit, the engagement team requires an member is required to exercise
understanding of the client’s business, professional judgment and maintain
its financial position and the professional skepticism throughout the
environment in which it operates. audit engagement.
The engagement partner is responsible Professional skepticism involves a

for the overall quality of the audit questioning mind and alertness to
engagement and therefore for the contradictions or inconsistencies in audit
direction, supervision and performance evidence. Professional skepticism
of the engagement. features prominently throughout
auditing standards and receives
Involvement and leadership from the significant focus from regulators. The
engagement partner during the planning KPMGTH Audit Quality Framework
process helps set the appropriate scope emphasizes the importance of
and tone for the audit and helps the maintaining an attitude of professional
engagement team obtain maximum skepticism throughout the audit. KPMG
benefit from the partner’s experience professional judgment process
and skill. Timely involvement of the facilitates good judgment by introducing
engagement partner at other stages of a structured approach to auditing areas
the engagement allows the engagement that require significant judgment. It also
24
reinforces the importance of audit to drive a culture of continuous
independence and objectivity and audit quality improvement.
emphasizes the importance of having
the right mind-set - the need to apply Ongoing mentoring and on-the-job
professional skepticism. coaching and supervision during an audit
involves:
Our professional judgment process
recognizes the need to be aware of, and  engagement partner participation in
alert to, biases which may pose threats planning discussions
to good judgment. The structured
approach to auditing areas that require  tracking the progress of the audit
significant judgment involves: engagement
 considering alternatives;  considering the competence and

capabilities of the individual
 critically assessing audit evidence members of the engagement team,
by challenging management’s including whether they have
assumptions and following up sufficient time to carry out their
contradictory or inconsistent work, whether they understand
information; and their instructions, and whether the
work is being carried out in
 documenting the rationale for accordance with the planned
conclusions reached on a timely approach to the engagement
basis as a means of evaluating their
completeness and appropriateness.  helping engagement team members
address any significant matters that
The use of the professional judgment arise during the audit, and modifying
process and the application of the planned approach appropriately
professional skepticism is reinforced
through coaching and training,  identifying matters for consultation
acknowledging that judgment is a skill with more experienced team
developed over time and with different members during the engagement.
experiences.
A key part of effective mentoring,
Ongoing mentoring and on the job coaching, and supervision is timely
coaching, supervision and review review of the work performed so that
significant matters are promptly
We understand that skills build over identified, discussed and addressed.
time and through exposure to different
experiences. To invest in the building of Appropriately supported and
skills and capabilities of KPMG documented conclusions
professionals, without compromising on
quality, KPMGTH promotes a KPMGTH uses the KAM and KPMG
continuous learning environment and International’s electronic audit tool,
supports a coaching culture. eAudIT, to provide guidance,
mechanisms for and documentation of,
The engagement partner, supported by the supervision and control of the audit
the engagement manager, is engagement. Audit documentation
responsible for driving a culture of records the audit procedures performed,
coaching and continuous learning evidence obtained and conclusions
throughout the audit process and setting reached on each audit engagement.
an example in the performance of the KPMG policies require review of
25
documentation by more experienced an objective review of the more critical
engagement team members. decisions and judgments made by the
engagement team and the
KAM recognizes that documentation appropriateness of the financial
prepared on a timely basis helps to statements.
enhance the quality of the audit and
facilitates the effective review and An EQC reviewer is required to be
evaluation of the audit evidence appointed for the audits, including any
obtained and conclusions reached related review(s) of interim financial
before our report is finalized. information, of all listed entities, non-
Engagement teams are required to listed entities with a high public profile,
assemble a complete and final set of engagements that require an EQC
audit documentation for retention within review under applicable laws or
an appropriate time period, which is regulations, and other engagements as
ordinarily not more than 60 calendar designated by the risk management
days from the date of the auditors’ partner or country head of audit.
report but may be more restrictive under
certain applicable regulations. The EQC review takes place before the
date of the auditor’s report and includes,
The key principle that engagement team among other matters:
members are required to consider is
whether an experienced auditor, having  review of selected audit
no previous connection with the documentation relating to significant
engagement, will understand: judgments the engagement team
made and the conclusions it
 the nature, timing, and extent of reached;
audit procedures performed to
comply with the ISAs and KAM and  review of the financial statements
other requirements applicable legal and proposed auditor’s report; and
and regulatory requirements
 evaluation of the conclusions
 the results of the procedures reached in formulating the auditors'
performed, and the audit evidence report and consideration of whether
obtained the proposed report is appropriate.
 significant findings and issues Although the engagement partner is

arising during the audit, and actions ultimately responsible for the resolution
taken to address them (including of financial reporting and auditing
additional audit evidence obtained) matters, the EQC reviewer must be
satisfied that all significant questions
 the basis for the conclusions raised have been resolved before an
reached, and significant professional audit can be considered to be
judgments made in reaching those completed.
conclusions.
KPMGTH is continually seeking to
Appropriate involvement of the strengthen and improve the role that the
Engagement Quality Control reviewer EQC reviewer plays in audits, as this is a
(EQC reviewer) fundamental part of the system of audit
quality control. In recent years, a
EQC reviewers are independent of the number of actions have been taken to
engagement team and have appropriate reinforce this, including:
experience and knowledge to perform
26
 issuing leading practices guidance Insightful, open and honest two-way
focusing on reviewer competencies communication with those charged with
and capabilities and on ongoing governance
support provided to EQC reviewers
Two-way communication with those
 incorporating specific procedures in charged with governance, often
eAudIT to facilitate effective identified as the audit committee, is key
reviews to audit quality and a key aspect of
reporting and service delivery.
 implementing policies relating to
recognition, nomination and At KPMGTH we stress the importance
development of EQC reviewers, as of keeping those charged with
well as monitoring and assessing governance informed of issues arising
the nature, timing and extent of throughout the audit, the need to listen
their involvement. and understand their views. We achieve
this through a combination of reports
Reporting and presentations, attendance at audit
committee or board meetings, and,
Auditing standards, Companies Act when appropriate, ongoing informal
2017 and other Special Companies discussions with management and
Regulations, largely dictate the format members of the audit committee.
and content of the audit report that
includes an opinion on the fair Communications with audit committees
presentation of the client’s financial include:
statements in all material respects.
Experienced engagement partners arrive  an overview of the planned scope
at all audit opinions based on the audit and timing of the audit, which
performed. includes communicating significant
risks identified
In preparing audit reports, engagement
partners have access to extensive  significant findings from the audit
reporting guidance and technical support which may include control
to audit through consultations with deficiencies and audit
DPPs, especially where there are misstatements
significant matters to be reported to
users of the audit report, (e.g. a  an annual written communication
modification to the opinion or through that states the engagement team
the inclusion of an emphasis of matter and KPMG has complied with
or other matter paragraph as well as key relevant independence
audit matters to be communicated). requirements; describes all
relationships and other matters
Effective for June 2018 year ends between KPMG and the audit client
onward in compliance with the new that, in our professional judgment,
IAASB requirements, we have enhanced may reasonably be thought to bear
auditor reporting for those audit reports on independence and states related
prepared under the ISAs as applicable in safeguards we have applied to
Pakistan. The changes in auditors’ eliminate (or reduce to an
reporting give users more insight into acceptable level) identified threats
the audit and improve transparency. to independence.
27
We ensure such communications meet auditors, whether or not they are KPMG
the requirements of professional member firms, as part of the
standards. engagement acceptance process.
Audit Committee Institute Consistent methodology and tools are

used across the KPMG network. Lead
In recognition of the demanding and audit engagement partners are provided
important role that audit committees with information on component auditors
play for the capital markets and also of within the KPMG network to help them
the challenges that they face in meeting evaluate their competence and
their responsibilities, our Audit capabilities. In addition, for PCAOB
Committee Institute (ACI) aims to help engagements, the results of relevant
audit committee members enhance inspections related to the KPMG
their commitment and ability to component member firms are made
implement effective audit committee available to the lead audit engagement
processes. The ACI operates in more partner.
than 40 countries across the globe
[including KPMG [insert name]] and Lead audit engagement partners may
provides audit committee members review component auditor engagement
with authoritative guidance (such as the documentation in person or obtain
ACI Audit Committee Handbook) on electronic access.
matters of interest to audit committees;
updates on issues like EU audit reform, 3.6.2 Client confidentiality, information
changes to accounting standards and security and data privacy
other matters of interest to Audit
Committees (such as cyber security and The importance of maintaining client
corporate culture); and the opportunity confidentiality is emphasized through a
to network with their peers during an variety of mechanisms including the
extensive program of technical updates Code of Conduct, training, and the
and awareness seminars. annual affidavit/confirmation process,
that all of our professionals are required
The ACI’s offerings cover the array of to complete.
challenges facing Audit Committees and
businesses today — from risk We have a formal document retention
management and emerging policy concerning the retention period
technologies to strategy and global for audit documentation and other
compliance. records relevant to an engagement in
accordance with the relevant IESBA
Further details and insights on Audit requirements as well as other applicable
Committee Institute are available here. laws, standards and regulations.
Focus on effectiveness of group audits Our firm has clear policies on

information security that cover a wide
The KPMG audit methodology covers range of areas. Data Privacy policies are
the conduct of group audits in detail. in place governing the handling of
We stress the importance of effective personal information, and associated
two-way communication between the training is required for all KPMGTH
group engagement team and the personnel.
component auditors, which is a key to
audit quality. The group audit
engagement partner is required to
evaluate the competence of component
28
3.7 Commitment to continuous standards, applicable laws and
improvement regulation and KPMG International
policies and procedures
 KPMGTH compliance with KPMG

International policies and
procedures and the relevance,
adequacy and effective operation of
key quality control policies and
procedures.
The results and lessons from the

integrated monitoring programs are
communicated internally, and the overall
results and lessons from the programs
are considered and appropriate action is
We commit to continually improve the taken at local, regional and global levels.
quality, consistency and efficiency of our Our internal monitoring program also
audits. Integrated quality monitoring contributes to the assessment of
and compliance programs enable whether our system of quality control
member firms to identify quality has been appropriately designed,
deficiencies, to perform root cause effectively implemented, and operates
analysis and develop, implement and effectively.
report remedial action plans both in
respect of individual audit engagements Two KPMG International developed and
and the member firm’s system of administered inspection programs are
quality control. KPMG International’s conducted annually across the Audit,
integrated quality and monitoring Tax, and Advisory functions, the Quality
programs include the Quality Performance Review (QPR) Programme
Performance Review (QPR) program, and Risk Compliance Programme (RCP).
the Risk Compliance Program (RCP) and
the Global Compliance Review (GCR) Additionally, all member firms are
program. covered at least every 3 years by the
cross functional GCR program.
The quality monitoring and compliance Participation in QPR, RCP and GCR is a
programs are globally administered and condition of ongoing membership of the
consistent in their approach across KPMG network.
member firms, including the nature and
extent of testing and reporting. Audit Quality Performance Reviews
KPMGTH compare the results of internal (QPRs)
monitoring programs with the results of
those of any external inspection The QPR program assesses
programs and take appropriate action. engagement level performance and
identifies opportunities to improve
3.7.1 Monitoring engagement quality.
Internal monitoring Risk-based approach
Our monitoring programs evaluate both: Each engagement leader is reviewed at

least once in a 3- year cycle. A risk-
 engagement performance in based approach is used to select
compliance with the applicable engagements.
29
KPMGTH conducts the annual QPR Lead audit engagement partners are
program in accordance with KPMG notified of less than satisfactory
International QPR instructions. The engagement (defined as ‘Performance
reviews are performed at KPMGTH level Improvement Needed’ or
and are monitored regionally and ‘Unsatisfactory’) ratings on their
globally. Member firm Audit QPR respective cross-border engagements.
reviews are overseen by a senior Additionally, lead audit engagement
experienced lead reviewer independent partners of parent companies/head
from the member firm. offices are notified where a
subsidiary/affiliate of their client group is
Reviewer selection, preparation and audited by a member firm where
process significant quality issues have been
identified during the QPR.
There are robust criteria for selection of
reviewers. Review teams include senior Risk Compliance Program (RCP)
experienced lead reviewers that are
independent of the member firm under KPMG International develops and
review. maintains quality control policies and
processes that apply to all member
Training is provided to review teams and firms. These policies and processes, and
others overseeing the process, with a their related procedures, include the
focus on topics of concern identified by requirements of ISQC- 1. During the
audit oversight regulators and the need annual RCP, we perform a robust
to be as rigorous as external reviewers. assessment program consisting of
documentation of quality controls and
Evaluations from Audit QPR procedures, related compliance testing
and reporting of exceptions, action plans
Consistent criteria are used to and conclusions.
determine engagement ratings and
member firm Audit practice evaluations. The objectives of the RCP are to:
Audit engagements selected for review
are rated as ‘Satisfactory’, ‘Performance  monitor, document and assess the
Improvement Needed’ or extent of compliance of [KPMGTH
‘Unsatisfactory’. system of quality control with Global
Quality & Risk Management policies
Reporting and key legal and regulatory
requirements relating to the delivery
Findings from the QPR program are of professional services; and
disseminated to member firm
professionals through written  provide the basis for KPMGTH to
communications, internal training tools, evaluate that the firm and its
and periodic partner, manager and staff personnel comply with relevant
meetings. professional standards and
applicable legal and regulatory
These areas are also emphasized in requirements.
subsequent inspection programs to
gauge the extent of continuous Where deficiencies are identified, we
improvement. are required to develop appropriate
actions plans.
30
Global Compliance Review Programs common platform for advancing the
(GCRs) practices and skills associated with
resourcing, planning and conducing
Each member firm is subject to a GCR RCA.
conducted by the global GCR team,
independent of the member firm, at The Global RCA 5 Step Principles are as
least once in a 3 year cycle. follows:
The GCR provides independent

oversight of our assessment of our
system of quality control, including:
 our commitment to quality and risk

management (tone at the top) and
the extent to which the overall
structure, governance and financing
support and reinforce this
commitment; and
 the completeness and robustness

of our RCP.
The GCR team performing the reviews

is independent of KPMGTH, objective It is the responsibility of member firms
and knowledgeable of Global Quality to perform RCA and thereby identify and
and Risk Management policies. subsequently develop appropriate
remediation plans for the audit quality
We develop action plans to respond to issues identified.
all GCR findings and agree these with
the GCR team. Our progress on action KPMGTH’s Head of Audit is responsible
plans is monitored by a global GCR for the development and
central team. Results are reported to the implementation of action plans as a
Global Quality & Risk Management results of RCA including identification of
Steering Group (GQRMSG), and where solution owners. The Risk Management
necessary to appropriate KPMG Partner monitors their implementation.
International and regional leadership, to
ensure timely remedial actions taken by External monitoring
the member firms.
KPMGTH, being a firm registered with
Root cause Analysis (RCA) The Institute of Chartered Accountants
of Pakistan is also subject to a Quality
KPMGTH performs root cause analysis Control Review (QCR) program of ICAP.
to identify and address audit quality
issues in order to prevent them from Quality Assurance Board
recurring and help identify good
practices as part of continuous Every firm registered with ICAP and
improvement. In 2017, RCA training conducting audits of financial
based on our Global RCA 5- Step statements of listed entities is required
Principles was attended by those to undergo a QCR organized by the
individuals at KPMGTH who will be Quality Assurance Board after every two
performing RCA or directing those and half years.
performing RCA. The training provides a
31
The Quality Control Board comprises of Commission of Pakistan (SECP) and
11 members including the Chairman. Institute of Chartered Accountants of
The Chairman is member of the Pakistan (ICAP), in line with international
institute. Council of the institute standards. Its functions, among many
nominates five members who are the others, includes registration and de-
members of the institute out of which registration of audit firms, which intend
two members are from industry while to carry out audit of public interest
three are audit partners from practicing companies and oversight and review of
firms or who served as audit partners in the Quality Assurance Board of the
professional firm. One member is Institute of Chartered Accountants of
nominated by the State Bank of Pakistan (ICAP).
Pakistan. Four members are nominated
by The Securities and Exchange AOB comprise of seven members
Commission of Pakistan (SECP) out of including its chairman. The members
which at least two are members of the and the chairman of AOB shall be
institute. One member is nominated by appointed by the Federal Government
the stock exchange. These members on the recommendation of the
can be both the practicing members and nominating committee.
members from the industry. The Board
performs its function and discharge its 3.7.2 Recommendations for improvements
responsibilities in accordance with
Quality Control Framework independent At a global level, through the GAQIC and
of the council. the GQRMSG, KPMG International
reviews the results of the quality
QCR is carried out by following a set of monitoring programs, analyzes member
procedures, which provide assurance on firm root causes and action plans and
the standard of audit work performed by develops additional global actions as
members in practice. Working paper required.
files of specific audit engagements are
selected from a list of audit clients of The GAQIC considers network-wide
the firm, and are reviewed to determine issues arising from internal quality
the audit report issued by the firm in control reviews and external
respect of reviewed client(s), was inspections, monitors progress being
supported or not supported by made in addressing audit quality issues
appropriate audit evidence. and makes recommendations to the
GASG on audit quality issues.
The selection of audit engagements is
made in such a manner that at least fifty To date, Global remediation plans
percent of all audit partners, and developed by KPMG International have
partners in each office location of the been aimed at changing culture and
Firm conducting audit shall be reviewed behavior across the KPMG network and
at driving consistent engagement team
None of the external inspections have performance within KPMG member
identified any issues that have a material firms.
impact on the conduct of our statutory
audit business. The remediation plans have been
implemented through the development
Audit Oversight Board of global training, tools and guidance to
drive consistency, ensure the
An independent Audit Oversight Board fundamentals are right and that best
(AOB) is established in the public practice is shared across the network
interest by Securities and Exchange
32
Revenues for the year ended 30th
3.7.3 External Feedback and dialogue September 2018 will be published in
December 2018 on kpmg.com, and
Regulator contained within the 2018 KPMG
International Annual Review. An
Quality Assurance Board is currently in updated statement of EU/EEA statutory
the process of conducting its QCR audit revenues for the 12 months to
which is started on 01 October 2018. 30th September 2018 will be available
Last QCR was conducted in May 2016. within the KPMG International
Transparency Report, also to be
Client Feedback published in December 2018 on
kpmg.com.
We proactively seek feedback from
clients through in-person conversations All figures presented to the best extent
and third- party surveys to monitor their calculable and translated at the average
satisfaction with services delivered. We exchange rate prevailing in the 12
endeavor to take this feedback and months ended 30th September 2017
make dynamic changes at both the (and 30th September 2018 for the
engagement level and firm level to meet updated numbers to be published in the
clients’ needs KPMG International Transparency
Report).
Monitoring of complaints
5.2 KPMGTH Revenue
We have procedures in place for
monitoring and addressing complaints KPMGTH revenues from the statutory
received relating to the quality of our audit for the year ended June 30, 2018.
work. These procedures are detailed in
our general terms of business. PKR.
Thousand
4 Public Interest Audit Client - Assurance services fee 6,930
billed to non-EU audit
clients listed in EU i.e.
During the period covered by this
OGDCL
Transparency Report, KPMGTH has
signed an audit report for Oil and Gas - Total other revenue 2,123,777
Development Company Limited
(OGDCL) that has transferable securities 6 Partner remuneration
listed on a regulated market in United
Kingdom. Revenue - For the year ended 30
June 2018
5 Financial information
Audit
26%
5.1 KPMG Network Revenue 42%
Tax
32%
Total revenues generated by KPMG
statutory auditors and audit firms, from Advisory
EU and EEA Member States resulting
from the statutory audit of annual and 6.1 Partners’ profit share
consolidated financial statements was
The majority of partners are equity
Euro 2.7 billion during the year ending partners and their share of profit is
30th September 2017. determined at the time of admission as
33
a full partner or when there is a change clients. For example, KPMG
in the partnership. The compensation of International establishes, and facilitates
other partners is determined by the the implementation and maintenance of,
senior partner and approved by uniform policies and standards of work
partnership. A proportion of profit is and conduct by member firms and
offered as incentive to partners protects and enhances the use of the
performing exceptionally. The Board KPMG name and brand.
decides on the proportion of profit to be
offered as incentive and evaluates KPMG International is an entity that is
partner’s performance. Audit partner legally separate from each member firm.
remuneration setting takes no account KPMG International and the member
of the level of non-audit services firms are not a global partnership, joint
provided to the partner’s audit clients. venture, or in a principal or agent
relationship or partnership with each
Partner’s compensation takes in to other. No member firm has any
account quality and ethics incidents. authority to obligate or bind KPMG
International or any other member firm
6.2 Drawings vis-à-vis third parties, nor does KPMG
International have any such authority to
During the year, Partners working within obligate or bind any member firm.
KPMGTH received monthly drawings,
and from time to time, additional profit The name of each audit firm that is a
distributions. The level and timing of the member of the network and the EU/EEA
additional distributions are decided by countries in which each network
the board, taking into account cash member firm is qualified as a statutory
requirements for operating and auditor or has its registered office,
investing activities. All such drawings central administration or principal place
and profit distributions to partners of business are available:
represent payments on account of
current year profits. Appendix A2 –
https://home.kpmg.com/xx/en/home/abo
7 Network arrangements ut/governance/list-of-kpmg-eu-eea-audit-
firms.html
7.1 Legal Structure
7.2 Responsibilities and obligations of
The independent member firms of the member firms
KPMG network are affiliated with KPMG
International, a Swiss cooperative which Under agreements with KPMG
is a legal entity formed under Swiss law. International, member firms are required
to comply with KPMG International’s
KPMG International carries on business policies and regulations including quality
activities for the overall benefit of the standards governing how they operate
KPMG network of member firms but and how they provide services to clients
does not provide professional services to compete effectively. This includes
to clients. Professional services to having a firm structure that ensures
clients are exclusively provided by continuity and stability and being able to
member firms. adopt global strategies, share resources
(incoming and outgoing), service multi-
One of the main purposes of KPMG national clients, manage risk, and deploy
International is to facilitate the provision global methodologies and tools. Each
by member firms of high quality Audit, member firm takes responsibility for its
Tax and Advisory services to their management and the quality of its work.
34
Member firms commit to a common set that are “members” of KPMG
of KPMG values. International as a matter of Swiss law.
Sub-licensees are generally indirectly
KPMG International’s activities are represented by a member.
funded by amounts paid by member
firms. The basis for calculating such Global Board
amounts is approved by the Global
Board and consistently applied to the The Global Board is the principal
member firms. A firm’s status as a governance and oversight body of
KPMG member firm and its participation KPMG International. The key
in the KPMG network may be responsibilities of the Global Board
terminated if, among other things, it has include approving strategy, protecting
not complied with the policies and and enhancing the KPMG brand,
regulations set by KPMG International or overseeing management of KPMG
any of its other obligations owed to International, and approving policies and
KPMG International. regulations. It also admits member firms
and ratifies the Global Chairman’s
7.3 Professional Indemnity Insurance appointment of the Global Deputy
Chairman.
A substantial level of insurance cover is
maintained in respect of professional The Global Board includes the global
negligence claims. The cover provides a chairman, the global deputy chairman,
territorial coverage on a worldwide basis the chairman of each of the 3 regions
and is principally written through a (the Americas; Asia Pacific (ASPAC); and
captive insurer that is available to all Europe, the Middle East, and Africa
KPMG member firms. (EMA)) and a number of senior partners
of member firms.
7.4 Governance structure
It is led by the Global Chairman, who is
The key governance and management supported by the Executive Committee,
bodies of KPMG International are the consisting of the Global Chairman, the
Global Council, the Global Board, and Global Deputy Chairman, the Chairman
the Global Management Team. of each of the regions and currently four
other senior partners of member firms.
Global Council The list of Global Board members, as at
1 October 2016 is available in the
The Global Council focuses on high-level International Annual Review.
governance tasks and provides a forum
for open discussion and communication One of the other Global Board members
among member firms. is elected as the lead director by those
Global Board members who are not also
It performs functions equivalent to a members of the Executive Committee
shareholders’ meeting (albeit KPMG of the Global Board (“non-executive”
International has no share capital and, members). A key role of the lead
therefore, only has members, not director is to act as liaison between the
shareholders). Global Chairman and the “non-
executive” Global Board members
Among other things, the Global Council
elects the Global Chairman and also Global Management Team
approves the appointment of Global
Board members. It includes The Global Board has delegated certain
representation from 58 member firms responsibilities to the Global
35
Management Team. These Each member firm is part of one of 3
responsibilities include developing global regions (the Americas, ASPAC, and
strategy by working together with the EMA). Each region has a Regional Board
Executive Committee. The Global comprising a regional chairman, regional
Management Team also supports the chief operating or executive officer,
member firms in their execution of the representation from any sub-regions,
global strategy and is responsible for and other members as appropriate. Each
holding them accountable for Regional Board focuses specifically on
commitments. It is led by the global the needs of member firms within their
deputy chairman, and includes the region and assists in the implementation
global chairman, the global deputy of KPMG International’s policies and
chairman, the global chief operations processes within the region.
officer, global function and infrastructure
heads and the general counsel. The list Further details about KPMG
of Global Management Team members, International including the governance
as at 1 October 2016, is available in the arrangements, can be found in its
International Annual Review. Transparency Report, which is available
at the following link:
Global Steering Groups
https://www.kpmg.com/Global/en/about
The Global Steering Groups work closely /governance/Pages/transparency-
with regional and member firm report.aspx
leadership to:
7.4.1 `Area Quality & Risk
 establish and communicate Management Leaders
appropriate audit and quality/risk
management policies; The Global Head of — Quality, Risk and
Regulatory appoints Area Quality & Risk
 enable effective and efficient risk Management Leaders who:
processes to promote audit quality;
and  assess the effectiveness of a
member firm’s quality and risk
 proactively identify and mitigate management efforts to identify and
critical risks to the network. mitigate significant risks to the
member firm and network, and
The Global Steering Groups act under actively monitor alignment with
the oversight of the Global Management global quality and risk management
Team. The roles of the Global Audit strategies and priorities;
Steering Group and the Global Quality &
Risk Management Steering Group are  share leading best practices in
detailed in the KPMG International quality and risk management; and
Transparency Report.
 report to Global Head of – Quality,
Risk and Regulatory.
36
8 Statement by the Board of KPMG Taseer Hadi & Co on the effectiveness of quality
controls and independence
The measures and procedures that serve as the basis for the system of quality control for
KPMGTH outlined in this report aim to provide a reasonable degree of assurance that the
statutory audits carried out by our firm complies with the applicable laws and regulations.
Because of its inherent limitations, the system of quality controls is not intended to provide
absolute assurance that non-compliance with relevant laws and regulations would be
prevented or detected.
The Board of KPMGTH has considered:
 the design and operation of the quality control systems as described in this report
 the findings from the various compliance programs operated by our firm (including the
KPMG International Review Programs as described in section 3.7.1 and our local
compliance monitoring programs); and
 findings from regulatory inspections and subsequent follow up and/or remedial actions.
Taking all of this evidence together, the Board of KPMGTH confirms with a reasonable level of
assurance that the systems of quality control within our firm have operated effectively in the
year to 30 June 2018.
Further, the Board of KPMGTH confirms that an internal review of independence compliance
within our firm has been conducted in the year to 30 June 2018.
Amir Jamil Abbasi

Senior Partner
For and on behalf of KPMG Taseer Hadi & Co.
Karachi,
37
9 Appendices
A 1. KPMG’s Values
KPMG Values
KPMG people work together to deliver value to clients. We believe strongly in a common
set of shared values which guide our behavior when dealing with both clients and each
other:
At all levels we act in a way that exemplifies what we

We lead by example
expect of each other and our clients.
We bring out the best in each other and create strong and
We work together
successful working relationships.
We respect people for who they are and for their

We respect the individual knowledge, skills and experience as individuals and team
members.
By challenging assumptions and pursuing facts, we

We seek the facts and
strengthen our reputation as trusted and objective business
provide insight
advisers.
We share information, insight and advice frequently and

We are open and honest in
constructively and manage tough situations with courage
our communication
and candor.
We act as responsible corporate citizens by broadening our

We are committed to our
skills, experience and perspectives through work in our
communities
communities and protecting the environment.
We are constantly striving to uphold the highest

Above all, we act with
professional standards, provide sound advice and rigorously
integrity
maintain our independence.
A 2. List of KPMG Audit entities located in EU & EEA
This is a list of KPMG audit firms as defined in Article 2 (3) of EU Directive

2006/43/EC which are located in EU/EEA countries. It has been prepared
solely for the purpose of compliance by KPMG member firms with
Regulation (EU) No 537/2014 on specific requirements regarding statutory
audit of public-interest entities and repealing Commission Decision
2005/909/EC. It is prepared by KPMG International Cooperative (‘KPMGI’), a
Swiss entity, which provides no professional services to clients. To the best
of our knowledge, the list as accurate as of 30 June 2018. However, we
cannot and do not warrant its accuracy at any given time.
Location Firm name

Austria KPMG Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (Wien)
Austria KPMG Alpen-Treuhand GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (Wien)
Austria KPMG Austria GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (Linz)
Austria KPMG Niederösterreich GmbH, Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
Austria Plan Treuhand GmbH Wirtschaftsprüfungs- und Steuerberatungsgesellschaft (Wien)
Austria Securitas Revisions- und Treuhandgesellschaft m.b.H.
Austria T&A Wirtschaftsprufüngs- und Steuerberatungsgesellschaft mbH
Belgium KPMG Bedrijfsrevisoren/KPMG Réviseurs d'Entreprises
Bulgaria KPMG Audit OOD
CEE KPMG CEE Holdings Limited
Croatia KPMG Croatia d.o.o. za reviziju
Cyprus KPMG
Cyprus KPMG Limited
Cyprus G. Syrimis & Co
Cyprus Metaxas Loizides Syrimis & Co
Czech Republic KPMG eská republika Audit, s.r.o.
Denmark KPMG P/S
Estonia KPMG Baltics OÜ
Finland KPMG Oy Ab
Finland KPMG Julkishallinnon Palvelut Oy
France KPMG Associés S.A.
France FUTIN Associés
France KPMG Audit DFA S.A.S.
France KPMG Audit Est S.A.S.
France KPMG Audit FS I S.A.S.
France KPMG Audit ID S.A.S.
France KPMG Audit IS S.A.S.
France KPMG Audit Nord S.A.S.
France KPMG Audit Normandie S.A.S.
France KPMG Audit Ouest S.A.S.
France KPMG Audit Paris et Centre S.A.S.
France KPMG Audit Rhône Alpes Auvergne S.A.S.
France KPMG Audit Sud-Est S.A.S.
France KPMG Audit Sud-Ouest S.A.S.
France KPMG SA
France KPMG Tartaroli
France SALUSTRO REYDEL S.A.
France KPMG SA
France KPMG Tartaroli
Location Firm name
France SALUSTRO REYDEL S.A.
France SAS de Commissaires aux Comptes Berthoud Coldefy Chabalier
France SGADG
Germany KPMG AG Wirtschaftsprüfungsgesellschaft
Germany ATH Allgemeine Treuhandgesellschaft mbH Wirtschaftsprüfungsgesellschaft
Germany EUREVISIO GmbH Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft
Germany KPMG Bayerische Treuhandgesellschaft Aktiengesellschaft
Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft
Germany KPMG Prüfungs-und Beratungsgesellschaft für den Öffentlichen Sektor
Aktiengesellschaft Wirtschaftsprüfungsgesellschaft
Gibraltar KPMG Limited
Greece KPMG Certified Auditors AE
Hungary KPMG Hungária Kft./KPMG Hungary Ltd.
Iceland KPMG ehf.
Ireland KPMG
Italy KPMG S.p.A.
Italy KPMG Audit S.p.A.
Latvia KPMG Baltics SIA
Liechtenstein KPMG (Liechtenstein) AG
Lithuania ‘KPMG Baltics’ UAB
Luxembourg KPMG Luxembourg
Malta KPMG
Netherlands KPMG Accountants N.V.
Norway KPMG Holding AS
Norway KPMG AS
Poland KPMG Audyt Sp. z.o.o.
Poland KPMG Audyt Sp. z.o.o. Sp. Komandytowa
Portugal KPMG & Associados - Sociedade de Revisores Oficiais de Contas, S.A.
Romania KPMG Audit SRL
Slovakia KPMG Slovensko spol. s r.o.
Slovenia KPMG Slovenija, podjetje za revidiranje, d.o.o.
Spain KPMG Auditores, S.L.
Sweden KPMG AB
UK KPMG LLP
UK KPMG Audit Holdings Limited
UK KPMG Audit Plc
UK KPMG Holdings Limited
UK KPMG Overseas Services Limited
Offices in Pakistan
Karachi Office
Sheikh Sultan Trust Building
Beaumont Road
Karachi 75300
Phone +92 (21) 3568 5847
Fax +92 (21) 3568 5095
eMail karachi@kpmg.com
Lahore Office
351 Shadman-1, Jail Road
Lahore 54000
Phone +92 (42) 111-KPMGTH (576484)
Fax +92 (42) 37429907
eMail lahore@kpmg.com
Islamabad Office
Sixth Floor, State Life Building
Blue Area
Islamabad
Phone +92 (51) 282 3558
Fax +92 (51) 282 2671
eMail islamabad@kpmg.com
www.kpmg.com
© 2018 KPMG Taseer Hadi & Co., a Partnership firm registered in Pakistan and a member firm of
the KPMG network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity. All rights reserved.
The information contained herein is of a general nature and is not intended to address the
circumstances of any particular individual or entity. Although we endeavour to provide accurate and
timely information, there can be no guarantee that such information is accurate as of the date it is
received or that it will continue to be accurate in the future. No one should act on such information
without appropriate professional advice after a thorough examination of the particular situation.
The KPMG name and logo are registered trademarks or trademarks of KPMG International.

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kpmg KPMG Taseer Hadi & Co.

1.1 Our business 5

2 Our structure and governance 5

2.1 Legal structure and ownership 5

3 System of quality control 6

3.1 Tone at the Top 8

4 Public Interest Audit Client 33

5.1 KPMG Network Revenue 33

6.1 Partners’ profit share 33

7.1 Legal Structure 34

8 Statement by the Board of KPMG Taseer Hadi & Co

The KPMGTH Board has determined Further details about KPMG

Under agreements with KPMG The Board meets on a regular basis

KPMG International’s activities are The Senior Partner has appointed a

2.4 Governance structure

KPMGTH apply high standards of

The Partnership (all partners) elects a

. Our Values are considered in the

Building on the KPMG Values is the

3.2.3 Engagement Evaluation

Each prospective engagement is also

Depending on the overall risk Location head of functions appoint

A prospective client or engagement will

3.2.4 Continuance process

KPMGTH undertakes an annual re-

The global audit methodology is KPMG International have detailed

e-AudIT’s activity-based workflow These policies are supplemented by

Firm financial Independence a) thirty days after joining KPMGTH or,

Business relationships / suppliers In addition, certain non-client-facing

Non-audit services KPMG International’s policies recognize

Breaches of independence policy

All KPMGTH personnel are required to

KPMGTH has a documented disciplinary

KPMG International rotation policies are

KPMGTH partners are subject to

Reward decisions are based on Audit engagement partners are required

The results of performance evaluations When considering the appropriate

 QPR results and results of

3.4.7 Insight from our people – Global People

Annually KPMGTH invite all its people to

The results of the GPS are also In addition to personal development

Learning is not confined to the 3.5.3 Access to specialist networks

In addition, we have specific KPMGTH promotes a culture in which

The GSC develops, maintains and

International Standards Group (ISG)

The ISG works with Global IFRS and

 timely partner and manager The engagement partner is responsible

 ongoing mentoring, supervision, and Critical assessment of audit evidence

The engagement partner is responsible Professional skepticism involves a

 considering alternatives;  considering the competence and

 significant findings and issues Although the engagement partner is

Audit Committee Institute Consistent methodology and tools are

Focus on effectiveness of group audits Our firm has clear policies on

 KPMGTH compliance with KPMG

The results and lessons from the

Internal monitoring Risk-based approach

Our monitoring programs evaluate both: Each engagement leader is reviewed at

The GCR provides independent

 our commitment to quality and risk