The company said the decision was taken following a year-long comprehensive external auditor tender process initiated in 2016 in line with international good governance practices. The proposal is subject to shareholder approval at ABB’s 2018 annual general meeting.

In a statement ABB said: ‘Ernst & Young has been ABB’s sole external auditors since 2001 and ABB’s board would like to thank the firm and its auditors for their contribution and dedication over the years. Ernst & Young will audit ABB for fiscal year 2017 as approved at ABB’s recent annual general meeting.

‘ABB looks forward to a constructive and professional relationship with KPMG in the future.’

EY were joint auditors of ABB from 1994 before taking over sole responsibility. According to ABB’s 2016 annual report, the firm was paid $24.9m (£19m) for audit services during the year, plus $4.6m (£3.5m) for non-audit services.

In February, ABB reported a $100m (£80m) hole in its accounts as the result of an in-house fraud in its South Korean subsidiary, which was master-minded by the local treasurer. In a statement at the time, the company said it has been the victim of ‘a sophisticated criminal scheme related to a significant embezzlement and misappropriation of funds in its South Korean subsidiary’.

By Pat Sweet