Investments and innovation G4-1
The constantly changing environment in which our clients operate calls for a virtuous cycle of investment in new solutions for the market. These innovative solutions bring mutual benefits for both clients and KPMG, further cementing our leading position.
This is strongly linked to our research, knowledge exchange among professionals from member firms, and development of new practices to expand our service portfolio.
Efficient business management was a constant pursuit in 2014. Rather than resorting to job cuts or extensive reorganisation, we relied on new management strategies, combined service offerings and technologies to get work done faster, better and at lower costs.
Together, efficiency and innovation have brought important improvements in the three areas of our business and created good prospects for the coming years. Learn more about some of these initiatives and/or the topics they relate to below.
Dynamic Audit: innovating the future of audit
Our global network is transforming the Audit practice. Our stakeholders have told us they expect a broader range of assurance on items that are currently outside statutory financial statements – such as performance indicators, sustainability and other financial and non-financial metrics that drive value for investors.
We have listened to our stakeholders and created new processes that are enabling us to make audit more relevant and to continue to raise the bar on quality. The new model enables us to:
- Enhance information security and analytics
- Make our delivery model more efficient and effective in creating value
- Demonstrate our understanding of risk, metrics and superior risk reporting
- Provide insights and projections to support our clients' decision making
The process is based on a combination of reliable tools and practices, notably:
eData Mining - A software application that extracts scenario data (general and by segment) to support analytics and comparison of client KPIs.
e-AudIT - An electronic audit file with all relevant client information provides an agile and secure workflow, connectivity with a multidisciplinary team, access to industry expertise and compliance with KPMG's Audit Manual.
Local Delivery Center - A specialist centre now handling 40 routine audit tasks previously performed manually by teams on the ground, enhancing agility and efficiency. Implemented in 2014, the centre has improved efficiency by approximately 10%.
Lean in Audit vence
Audit Innovation of the Year 2014
The KPMG methodology, which is part of Dynamic Audit, won the Audit Innovation of the Year award at the prestigious IAB (International Accounting Bulletin) awards.
Data and Analytics (D&A)
Organising and utilising available electronic information has become crucial to business intelligence. The big data market has evolved considerably in recent years, creating challenges as well as opportunities for businesses in general, and for KPMG in particular. Globally, we have made important investments in technology partnerships, strategic alliances and the recruitment of top talent to create new D&A solutions and tools for use in our Audit, Tax and Advisory practices, providing meaningful benefits to our clients.
Technology and expertise applied to Tax
The end of the Transition Tax Scheme, implementation of Siscoserv, Act 12.741 (requiring taxes to be stated on invoices) and new Tax Accounting requirements have significantly changed the way companies organise and report information to tax authorities.
Alert to these developments, KPMG has created solutions that combine our tax insights and technology to assist clients in reviewing their internal processes and implementing the technology required to organise and reconcile their reporting information with the necessary agility and efficiency.
KPMG eSocial and ECF solutions
A component of the Public Digital Accounting System (SPED), eSocial is designed to unify and digitalise tax, labour and social security obligations in order to streamline oversight of information reported to tax authorities. Implementation has been postponed to 2016, giving companies more time to adapt to the complexity of the new system.
Another tax obligation created in 2014 (effective in 2015), and which has required companies to implement major changes, is a new Tax Accounting (ECF) system that consolidates companies' Corporate Income Tax and Social Contribution reporting information and requires companies to identify all information reported in the ECF system in their accounting records. The challenge lies in the diversity of companies' accounting processes and/or policies, which will need to be adapted to meet this new requirement.
KPMG in Brazil has developed an integrated and multidisciplinary approach to assisting companies in complying with the new eSocial and ECF requirements. Leading information technology specialists have joined our experienced team of Tax experts to develop solutions entailing process and system reviews, data compliance analyses and specialist insight into the risks inherent to Human Resources and compliance with labour and social security regulations.
Supported by KTAX, a tax compliance solution developed by KPMG in 2012, clients now have an efficient, high-quality and secure solution for previewing electronic information reported to tax authorities.
Regionalisation in Advisory
Our 26 offices across 13 Brazilian states operate as a gateway into different economic and market segments.
In 2014, we approved a new Advisory regionalisation model based on regional hubs with local teams of specialists in locally relevant services, enabling us to meet region-specific demands and strengthen our practice. The regionalisation model includes two fronts:
- National: expansion of our footprint into new hubs: interior São Paulo/Campinas, South/Curitiba, Centre/BH and North and Northeast/Fortaleza.
- International: leveraging synergies across the network of KPMG member firms in Latin America to better service clients.
Support for Public-Private Partnerships (PPPs)
We advise a range of government and private clients on projects within the Public-Private Partnership (PPP) model as well as on related matters, such as city development, sanitation, waste disposal, urban mobility and social issues. This area offers tremendous opportunities that will translate into benefits for society as a whole, and should remain high on our agenda in 2015.
KPMG, PPPs
and the development of Brazil's southern cities
In recent years, cities have been at the centre of integrated development globally, and PPPs are excellent opportunities to boost this development. Many businesses and governments, however, are still uncertain as to how to go about developing these partnerships.
Responding to this, KPMG's specialist Cities/South Region Advisory group has collaborated extensively with universities, state and municipal governments, businesses, development agencies, trade associations, the National Confederation of Municipal Governments, the Business Leaders Group (LIDE) and the PUC/RS Research and Development Centre to develop and model projects with a focus on regional development.
Strategies for compliance with National Waste Management Policy
Our multidisciplinary Risk Consulting team has helped clients address the new challenges arising from the National Waste Management Policy, which requires manufacturers, importers, distributors and retailers in six major product categories to structure and implement systems and controls for returning products following use by consumers without using municipal waste collection and waste management services.