He will take over from Sir Christopher, who will stay on in a consultancy role until the end of 2003, after the company’s annual meeting on 30 July. The City was caught off guard yesterday when Vodafone announced Sir Christopher Gent would retire next year as chief executive and it emerged that his successor was Arun Sarin, a Vodafone non-executive who was not considered a frontrunner for the top job.
Mr Sarin’s appointment looks likely to reignite the dispute over executive pay – something that has plagued Vodafone since Sir Christopher was awarded a controversial £10m bonus for the takeover of Germany’s Mannesmann.Vodafone said yesterday that Mr Sarin would be paid a base salary of £1.1m a year and incentives “which have the same structure and quantum” as Sir Christopher’s. A year ago, KPMG’s UK revenue rose 18 per cent.KPMG sold its consulting business in July to the Dutch group Atos as part of the industry-wide shift towards separating this type of business from audit work due to concerns in the market about potential conflicts of interest.KPMG and the other big auditors – PricewaterhouseCoopers, Deloitte Touche Tohmatsu and Ernst & Young – are still awaiting a decision by the Government on how much more separation has to take place.. It now has 9,500 UK employees and said it had “no plans” at the moment to cut its headcount further.Accounting firms have posted the slowest revenue growth in more than a decade in the past year, hurt by a slowing global economy which has reduced company spending on advisory work. Revenue at KPMG’s corporate-recovery business, which assists businesses with insolvency and restructuring, rose 13 per cent to £82m, from £73m.KPMG’s 600 UK partners saw their average earnings fall to £352,000 each from £462,000.Mike Rake, the chairman of KPMG in the UK, said: “Restructuring, redundancy and higher people costs have affected our level of profitability.

Tough trading conditions and a downturn in the financial markets made this a difficult year for everyone.”KPMG said it had made 1,000 partners and staff redundant last year due to the reduced demand for its services. Fees from corporate finance dropped 7 per cent to £83m.Some parts of the business benefited from the turbulent economic climate, with fees from the assurance department, which includes audit, rising 3 per cent to £421.5m. KPMG, one of the Big Four accountancy firms, yesterday said it had one of its toughest ever years due to grim market conditions, in which British partners at the firm saw their earnings collapse by almost 25 per cent.
The UK part of KPMG said underlying pre-tax profit fell 21 per cent to £212m in the year to 30 September, with income from tax advisory work and corporate finance suffering most due to the grim economic conditions. In September, Mr Blackley reduced his ITV 2003 forecast from 4 per cent growth to 0.5 per cent expansion, before going for a negative number yesterday.ITV is currently renegotiating up to 70 per cent of its airtime contracts with advertisers for 2003 and beyond.

Given the network’s poor showing earlier this year in drawing audiences to its programmes, Mr Blackley has argued that the revenues it can command will suffer.Mr Blackley said: “There are suggestions in the market that some advertisers, such as Diageo, Nestl?Kingfisher, News Corp and Colgate Palmolive have been playing hard ball, and are prepared to drop ITV in January, if they don’t get the required share reductions [discounts].”Merrill Lynch reduced its 2003 profits forecast for Carlton by 9 per cent and took 5 per cent off its figure for Granada.. Most other analysts are predicting small growth at ITV in 2003, after a 4 per cent decline this year. ITV is telling regulators that its market share is in steep decline and is playing down the extent to which a merged Carlton-Granada will dominate the TV market.Merrill Lynch said although the TV advertising market will grow 3.3 per cent next year, ITV will see its revenues shrink by 0.7 per cent. The two main ITV companies, Carlton and Granada, are trying to convince regulators to allow them to merge.Mr Blackley, head of the media team at Merrill Lynch, said that due to ITV’s poor advertising sales next year, its share of the total market will shrink from 53.6 per cent to 51.5 per cent. Neil Blackley, the leading City media analyst, predicted yesterday that ITV would see advertising revenues shrink in 2003, making it the second negative year in a row.
While this is very bad news for ITV at an operating level, the forecast may prove useful on the regulatory front. there is still room for the Bank of England to cut rates to give the economy a new year boost.”But there was little hint of that in the latest minutes of the MPC. For the second month running the Committee voted 7 to 2 not to change interest rates.