Audit and tax firm KPMG has agreed to sell its dispute advisory services unit to FTI Consulting Inc. for $89.1 million.
The deal, which is expected to close during the fourth quarter of 2003, will bring 125 professionals and support staff, including 26 partners, to Annapolis, Md.-based FTI.
The sale will help KPMG avoid any appearance of improper behavior under the Sarbanes-Oxley Act, which prohibits firms from providing various types of consulting services to their auditing clients. KPMG is divesting the DAS unit, which provides advice to clients dealing with accounting disagreements, even though it isn’t required to do so under the act.
“Despite the fact that providing DAS is permissible to nonaudit clients, in the spirit of Sarbanes-Oxley, we actively sought and found a buyer–making us the first among the Big Four audit firms in the United States to divest its dispute advisory services unit,” says Richard Girgenti, national partner in charge of KPMG's forensic practice.
After the sale, Mr. Girgenti says, the firm will still have over 300 forensic accounting specialists, largely in the areas of fraud investigations and forensic technology.
“We're intent on growing our forensic services in New York and the United States, where we have market permission and where we will assist clients in their efforts to detect, prevent and investigate fraud and misconduct,” he says.