KPMG to settles US case
KPMG has agreed to pay US$8.2 million to settle US regulators’ charges of compromising its independence by providing non-audit services to companies whose books it audited. The Securities and Exchange Commission (SEC) announced the settlement on Friday with New York-based KPMG, one of the so-called “Big Four” accounting firms with Deloitte, Ernst & Young and PricewaterhouseCoopers. The SEC said KPMG violated auditor independence rules by providing prohibited non-audit services like bookkeeping to the companies involved. In addition, the SEC said some KPMG employees owned stock in companies that were KPMG audit clients. The company is paying about US$6.5 million in restitution and interest, and a US$1.77 million penalty. KPMG also agreed to hire an independent consultant to monitor its compliance with rules.
Venezuela limits profits
Venezuela on Friday decreed a new price control law that sets limits on company profits and establishes prison terms for those charged with hoarding or overcharging, part of socialist Venezuelan President Nicolas Maduro’s efforts to tame inflation. Under the Fair Price Law, Venezuela sets a maximum profit margin of 30 percent and requires firms to obtain “fair price certificates” to access US dollars through the country’s currency control mechanism. The law carries prison sentences of up to 14 years for crimes including hoarding, “destabilizing the economy” and food trafficking, which refers to people buying subsidized goods and reselling them mainly in neighboring Colombia.
P&G profits top forecasts
Procter & Gamble Co (P&G), the world’s largest consumer-goods maker, posted second-quarter profit that topped analysts’ estimates as sales of products, such as Pampers diapers, rose in emerging markets. Net income fell 16 percent to US$3.43 billion, from US$4.06 billion a year earlier, Cincinnati-based P&G said on Friday in a statement. Excluding some items, profit was US$1.21 a share, exceeding the US$1.20 average of 20 analysts’ estimates compiled by Bloomberg. Chief executive officer AG Lafley has said developing markets with climbing household incomes will be “significant” drivers of growth. Sales in such countries rose 8 percent in the quarter, excluding the effects of acquisitions, divestitures and foreign-currency exchange-rate fluctuations.
Power usage fees change
Germany is set to become the first nation in Europe to charge owners of renewable energy plants for their own use of electricity, part of German Chancellor Angela Merkel’s effort to contain rising power bills. Merkel’s Cabinet backed proposals to charge operators of new clean-energy plants 70 percent of the so-called EEG-Umlage, a fee paid by power consumers that they are currently exempt from, according to a government document. That would translate into 0.044 euros (US$0.06) per kilowatt-hour. The solar industry says such a payment would curb investments in the technology in the nation that has the most installations of photovoltaics in the world.