Final answer:
KPMG settled with the SEC in 2014 for independence violations that arose from providing non-audit services to affiliates of audit clients, breaching auditor independence rules.
Step-by-step explanation:
In 2014, KPMG settled charges with the Securities and Exchange Commission (SEC) for alleged independence violations. These charges stemmed from KPMG's provision of non-audit services to affiliates of some of the firm's audit clients, which is incompatible with the auditor independence rules.
The SEC maintains strict regulations regarding the independence of auditing firms to ensure the integrity and objectivity of their audits. In this case, KPMG agreed to settle by paying a fine without admitting or denying the allegations, and it was also required to undertake certain additional actions to prevent future violations.
Such instances highlight the importance of adhering to the ethical and professional standards set by governing bodies in the field of accountancy and auditing.