At a press conference attended by the Budapest Business Journal, outgoing head Robert Stöllinger said that KPMG Hungary closed a strong financial year in September, with a revenue of approximately HUF 26 billion.
He noted that in 2003, when he took over the leadership of the firm, the number stood at only HUF 6.9 bln. In an important shift, he noted that the complexity of services offered by KPMG has grown, while the share of accounting in the revenue has fallen.
“A growing number of international groups are bringing a part of their audit activities to Budapest,” Stöllinger noted, adding that the company’s SSC audit, bank sector, and insurance sector advisory services have increased in importance.
New national senior partner Rezső Rózsai praised Stöllinger’s legacy, adding that he will not be the leader of KPMG Hungary for 16 years like his predecessor, due to changed internal regulations. Regarding the current business environment, he noted that companies now face pressure from all directions, including from society.
“While social expectations may carry lower penalties for non-compliance than legal expectations, they could have a larger effect on the revenue side,” he said. According to Rózsai, the business world now faces challenges beyond its control, such as climate change and technological advancements; success depends on how companies react to trends.
“Change is always difficult. However, preparing for an economic crisis is not the most difficult thing; preparing for growth and keeping up the tempo is,” he argued.
The pace of digitalization has changed the audit business according to him. “The day before yesterday we called something impossible, yesterday we called it unlikely, and today we call it routine,” Rózsai said.
The expert also argued that indicating audit-related problems in real-time or even predicting them have become increasingly important, as clients are able to pick between alternatives and react to the issues as soon as possible.
Recently appointed deputy national senior partner Gábor Beer argued that the attitude of the tax authority in Hungary as changed significantly compared to 10-15 years ago. Instead of investigating numerous companies out of the blue, applying hefty fines, they have, “Changed from using a machine gun to a sniper rifle,” as he put it.
Due to innovations such as e-invoicing, the authorities are now easily aware of problems, yet they warn individuals and entities first, instead of issuing penalties immediately, Beer said.
The expert added that perhaps the largest challenge tax authorities face today, not only in Hungary, is the taxation of giant firms such as Facebook. Beer argued that the basis of relevant double taxation laws was laid down in the 1970s and ‘80s in Hungary, with no one able to predict the modern ways of operation of global businesses, such as outsourcing.
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