Of the remaining tax fees of $4,899,000, approximately $3,720,000 represents fees directly related to the Merger and subsequent integration of PRA.  The integration of ICON and PRA following the Merger is a significant, complex transaction for the Company.  These fees directly related to tax advice on the steps required to integrate and eliminate legal entities of PRA and ICON following the Merger.  ICON operates in over 80 countries.  The fees also include detailed transfer pricing advice on business model integration.  These fees were included in total transaction and integration related costs of $39,695,000 incurred during the year ended December 31, 2022.  Total transaction and integration related costs were separately disclosed on the face of the Consolidated Statement of Operations included in the 20-F.  These costs were disclosed (in the form 20-F) as consisting primarily of investment banker fees, advisory fees, legal costs, accounting and consulting fees, share-based compensation expense, and employee retention bonuses.  As explained in our quarterly results press releases (including the press release issued on February 22, 2023), the fees are directly related to the Merger and integration of ICON and PRA.

We believe the nature of these services as related to significant one-time capital structure events warrants categorizing them as “other fees” and that these fees should be excluded from the non-audit fees considered in determining the ratio of non-audit to audit/audit-related fees.

The remaining amount, approximately $1,179,000, in the “Tax Fees” category represents fees related to other tax planning and consulting services across a number of areas including relating to the group’s financing facilities, and other ad hoc tax advisory services.  Therefore, tax consulting fees excluding “other fees” related to significant one-time capital structure events are $1,179,000 or 12% of total fees.

In summary, the details of fees paid to KMPG for the year ending December 31, 2022 are as follows:

 

 

The Audit Committee carefully reviewed these non-audit, tax-related services provided by KPMG and concluded that KPMG’s expertise on these matters and familiarity therewith would provide significant advantages to the Company in the post-Merger period for this important work. The Audit Committee carefully evaluated these continued engagements, reviewed the independence of KPMG, and approved this continued work. In addition, KPMG followed its own internal process of detailed review before it concluded that providing these non-audit, tax-related services to the Company did not impair its independence, both at the outset and conclusion of each matter.

The ISS recommendation against the re-election of the current members of the Audit Committee is based on the Audit Committee’s approval of the non-audit services discussed above.  When the “Tax Fees” category is broken out to clarify the services provided, we believe that it is clear that the non-audit related fees paid by the Company to KPMG were not “excessive.” Furthermore, the Company believes the engagement of KPMG to provide these services was appropriate, and that the Audit Committee acted in the best interests of the Company and its shareholders in approving these services.

Therefore, in light of the additional information and clarification described above, we believe that the non-audit related fees paid by the Company to KPMG for the fiscal year ended December 31, 2022, were appropriate and the Board continues to recommend that you vote “FOR” each of our director nominees, including all current members of the Audit Committee. The Board also continues to recommend that you vote “FOR” the resolution that authorizes the Board to fix the remuneration of our Auditors.  The Board believes that the resolutions to be proposed at the AGM are in the best interests of the Company and its shareholders.

If you have already cast a vote contrary to the Board of Directors’ recommendation on the foregoing matter and wish to change your vote, you may change your vote by following the instructions included in the AGM Notice.