KPMG LLP Statement On Meeting Of Introduction At Securities & Exchange Commission

May 05, 2002, 01:00 ET from KPMG LLP

    NEW YORK, May 5 /PRNewswire/ -- KPMG LLP, the U.S. accounting and tax
 firm, believes it is important to set the record straight regarding an
 April 26, 2002 meeting between KPMG LLP Chairman Eugene D. O'Kelly, and the
 Chairman of the Securities and Exchange Commission, Harvey Pitt.  Their
 introductory meeting, as originally reported April 29, 2002 in the Wall Street
 Journal, was one of Mr. O'Kelly's first official acts as Chairman of KPMG LLP.
 Neither of the individuals had either met or spoken before.
     A subsequent Bloomberg story on May 3, 2002 misrepresented an internal
 KPMG memo from Mr. O'Kelly to all KPMG employees that referenced the meeting.
 In fact, the memo was on another subject, describing the firm's work in
 dealing with former client Xerox Corporation and the positions that the firm
 had taken publicly with regard to Xerox.  The meeting at the SEC was
 referenced by Mr. O'Kelly in the concluding sentences of that relatively
 lengthy memo.  Subsequent media reports, based at least in part on the
 Bloomberg story, took the internal memo and the SEC meeting out of context.
     An accurate portrayal of the meeting would reflect that it was solely a
 meeting of introduction between Mr. O'Kelly and Mr. Pitt -- rather than a
 discussion on Xerox, as the May 3 Bloomberg story and several updates to that
 story by Bloomberg reported.
     "The meeting was arranged at my request to introduce myself to Chairman
 Pitt as KPMG's new Chairman, and to ensure that Mr. Pitt was aware that my
 number one priority was for the firm to take a leadership position in helping
 advance reform for the industry," said Mr. O'Kelly.
     "As a firm, we have been very public and forthright about our position on
 any action the SEC might take related to Xerox.  I referenced a potential
 proceeding against KPMG at the very end of our meeting and that KPMG would
 take all necessary steps to protect our firm and its reputation," said Mr.
     "KPMG did the right thing in its dealings with Xerox.  We did everything
 the public expects an auditor to do, and more, to ensure that the investor was
 protected and that we fulfilled our responsibilities," Mr. O'Kelly said.
     KPMG said there was nothing additional about the meeting to report and it
 did not intend to make further comment.
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