Global Infrastructure Major Sporting Events Global Credentials KPMG INTERNATIONAL
Wherever they may be, cities and countries that host major international sporting events make substantial financial commitments to capital projects that must be planned, financed, and completed within a specified and immovable timeframe. Hosting global sporting events is often a catalyst for major infrastructure and urban re-development that can go well beyond the sports facilities. Such additional infrastructure projects may include improvements to highways, urban transportation systems (e.g. light rail and inter-city rail lines) and airports, as well as commercial construction such as hotels and upgrades in technology and telecommunications systems. Financing major sporting events and their related infrastructure is a highly capital intensive effort that can often exceed municipal and government budgets. As a result, many of these types of projects involve public-private financing initiatives that reallocate some of the financing costs and project management responsibilities to help ensure that the host country can manage the overall scope of the project.
Meeting the Challenge Staging major sporting events is no small feat and requires planning and execution to take place within the context of rigid demands that include: No elasticity on the time frame for events the dates are immoveable. All construction projects must be completed prior to the events sport facilities and venues, athletes village, and all infrastructure and ancillary projects such as new hotels. All aspects of the planning, staging, and hosting of the events are an international media event any mistakes on the part of the host city/nation will be seen and judged both globally and instantaneously. These factors mean that governance, transparency, and process controls all become increasingly important during the planning and staging of major sporting events. Additional challenges may also come from complex interdependencies as exponential growth occurs in: The complexity of the multiple interdependent projects, including refinement of designs, requirements, costs and changes in project priorities; The number of stakeholders involved in making decisions, managing risk, and creating deliverables; and Tracking revenue and venue progress, including dependencies between venues and infrastructure projects and/or venue projects and events operations. Planning Interdependencies Infrastructure Increased Complexity Sport Venue Construction Events Operations Typical Issues Construction and operations cost and/or schedule overruns; Multiple sub-projects that lack consistency in project management and reporting; Multiple layers of risk arising from: Unclear or competing stakeholder interests; Pressures on costs due to unclear specifications, scope changes, sub-optimal procurement processes, inflation; Design/construction issues, including interfaces between sports venue and infrastructure projects; and Delays in obtaining approvals or decisions.
2 Major SPORTING EVENTs: Global Credentials How Can KPMG Firms Help? KPMG s Major Sporting Events practice professionals have extensive local and global experience advising government organizations, contractors, and investors in the following areas: Planning, structuring, and management of new infrastructure investments Procurement and financing support Improvement and monitoring of construction and operations Restructuring of distressed projects Investment due diligence assistance Infrastructure related to audit, tax, accounting, and compliance issues.
Major SPORTING EVENTs: Global Credentials 3 Why KPMG? Objective Advice. Our advice is objective regarding project outcomes. Established Track Record: KPMG firms are among the global leaders in infrastructure advisory and providing feedback on the financial health and status of construction projects. Broad Perspectives: Our diverse team combines backgrounds in municipal finance, banking, government, engineering, construction management, law, and consulting. KPMG firms professionals can help you navigate through complex and competing stakeholder issues to strike a balance between key policy protections and their financial implications, schedule extension and reporting, quality/scope adjustments, and project risk management. Wide Range of Services: KPMG firms can offer advice through the lifecycle of complex infrastructure programs from program formation to project execution, to ongoing performance monitoring though a risk-based approach to assessing processes embedded in your construction program. Our services are designed to assist project owners to successfully navigate their construction projects through multiple challenges. Extensive Network: Our member firm teams extend globally and includes senior resources who have advised on groundbreaking infrastructure projects around the world. With on call access to our network, you receive the latest innovative thinking available anywhere. Deep Bench: KPMG has a deep bench of experienced professionals. We can rapidly scale project resources up or down according to your specific needs.
4 Major SPORTING EVENTs: Global Credentials Major Sporting Events Lifecycle and Key Activities KPMG understands the lifecycle of major sporting events, and KPMG s practice is designed to provide support across the key activities for all phases of the lifecycle. Appraise Define Establish Key Inputs Mandate-Local/Decision to Proceed Decision to Award Approved Program Plan Key Activities Establish Bid Organization Analyze Options Establish Organizing Committee Conduct Detailed Feasibility Assessment (facilities & operations) Establish Program Delivery Team Develop Detailed Project Plans Assess Scope Select Project Option (facilities & operations) Define Project Requirements Identify Potential Partnering Arrangements Prepare Business Case Establish Procurement Process Assess Risk Refine Project Costs Manage Bidding Process Conduct Market Sounding Develop Financial/ Funding Strategy Negotiate Contract(s) Identify Project Costs Develop Risk Mitigation Strategy Finalize Funding Agreements Identify Funding Sources Develop Partnering Agreements Establish Risk, Performance & QA Framework Develop and Submit Bid Develop Program Plan Key Outputs Business Case/ Bid Book Program Plan Detailed Project Plans, Contracts in Place, Monitoring Plan
Implement Operate Transition Approved Project & Monitoring Plans Readiness Acceptance Completion of Event Implement Operational Readiness Plans Host & Stage Event Close Out Program Construct Facilities Transfer Asset(s) Implement Project Management Process Execute Legacy Commitments Conduct Post Project Review Completed Venues & Operational Readiness Successful Event Post Project Report
6 Major SPORTING EVENTs: Global Credentials KPMG Firms Major Sporting Events Qualifications KPMG understands the business of major sporting events, having provided a wide range of professional services to organizations responsible for planning and staging major global sporting competitions. Examples include over a dozen Olympic Games (summer and winter), Commonwealth Games, and other significant sporting events. KPMG s typical services include: Business case development, project planning, risk analysis and procurement strategy for infrastructure Development of business cases and business plans for sport facilities/venues Evaluation of private sector proposals to build, own, operate and transfer sport facilities/venues Development and implementation of events safety and security program Development of ecological strategy Project and financial issues management Analysis/definition of operating processes Cost due diligence Post-events use of sport facilities (business planning, governance options, financial projections) Development of strategies for legacy land post-event Development of costed security plans IT sourcing options Tax advisory and audit services
M aj o r S POR T I N G E V E N Ts : G l o bal C r edential s 7 KPMG Firms Major Sporting Events Experience Calgary, Alberta, Canada London, England Vancouver, BC, Canada Manchester, England Athens, Greece Salt Lake City, Utah, USA Sochi, Russia Albertville, France Los Angeles, California, USA Lake Placid, New York, USA Torino, Italy Nagano, Japan Atlanta, Georgia, USA Sydney, Australia Cape Town, South Africa
8 Major SPORTING EVENTs: Global Credentials KPMG s Major Sporting Events Professionals KPMG s Major Sporting Events are part of KPMG s Global Infrastructure practice. KPMG s Global Infrastructure professionals can provide objective advisory support to our member firm clients throughout the lifecycle of complex infrastructure projects. KPMG member firms are global leaders in advising on infrastructure. With some of the largest and most experienced teams around the world, we support infrastructure contractors, operators and investors, and government organizations through the lifecycle of complex projects and programs by providing strategic, financial, and commercial advice to public and private sector clients on infrastructure transactions.
Contact Us For further information please email our team: infrastructure@kpmg.com or visit us online: www.kpmg.com/infrastructure The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. 2009 KPMG International. KPMG International is a Swiss cooperative. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 090901
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