KPMG Australia to Cut Nearly 5% Jobs After Audit Scandal
Synopsis
KPMG Australia will cut 27 partners and about 360 employees as it deals with lower revenue, lost government contracts and the fallout from its audit scandal.
- KPMG Australia will cut 27 partner roles and about 360 staff positions, equivalent to roughly 5% of its workforce.
- KPMG Australia has repeatedly declining revenue (down 1% to A$2.26 billion for the year ended June 2026).
- Consulting revenue was down 17% as the firm lost government contracts.
- KPMG anticipates difficult market conditions to persist until 2027 and beyond.
KPMG Australia is cutting 5% of staff as weaker revenue, lost government contracts and fallout from the audit scandal all put pressure on accounting firm.
Sovereign Advisory is managing 27 partners and approximately 360 employees, most of whom work in consulting and business services. KPMG Australia chief executive John Sams said the decision had been a difficult one, and recognised it would be difficult for staff. The company said it will assist employees impacted by the changes.
Revenue Falls as Consulting Business Struggles
KPMG Australia recorded revenue of A$2.26 billion for the financial year ended June 2026, down from A$2.28 billion a year earlier. Consulting was the weakest area, with revenue falling 17% due to lower demand and the loss of government contracts.
Other parts of the business performed better. Four of KPMG’s five divisions recorded revenue growth during the year. Deal advisory and infrastructure revenue increased 3%, while tax and legal and audit and assurance both rose 11%. The mid-market and private division grew 6.4%. Average pay for equity partners also dropped 13% as KPMG focused on reducing costs.
KPMG Under Pressure Over Audit Scandal
KPMG has faced months of scrutiny following allegations that confidential client information was used to help secure major audit contracts.
In March, Labour senator Deborah O’Neill raised allegations in Parliament that confidential Lendlease board papers had been used to support bids for audit work with Westpac and Dexus. The allegations triggered further investigations, including questioning of current and former KPMG partners by a federal inquiry.
The scandal has also resulted in significant leadership changes. KPMG Australia’s former chief executive, audit boss, chairman and several senior audit partners have left the firm. KPMG has also lost most of its ongoing government contracts.
KPMG Stops Bidding for New Federal Work
KPMG Australia has agreed not to bid for new federal government work until September 30 while reviews into its governance, culture, ethics and integrity are completed.
The Australian government is also considering possible changes to the way the country’s four major accounting firms are regulated. KPMG, Deloitte, EY and PwC operate as partnerships rather than companies, meaning they are not regulated in the same way as companies by Australia’s corporate regulator.
More Changes Could Follow
KPMG Australia is also restructuring parts of its business. Its mid-market and private deals team will move into the deal advisory and infrastructure division, while its advisory team will become part of consulting. The changes are designed to create more closely connected teams and bring KPMG Australia closer to the structure of its global advisory business.
The firm will also consult on a small number of additional roles. Sams said further changes could follow as KPMG continues its internal and external reviews. The findings are expected to help determine the firm’s next steps.
KPMG Warns of Difficult Market Conditions
KPMG expects tough market conditions to continue through the 2027 financial year and beyond. The firm expects Australia’s economic growth to remain weak until at least 2028. It said this could weigh on client spending and result in longer decision-making times.
KPMG also said the professional services industry is changing as client needs evolve, AI changes how services are delivered and government spending on consultants remains lower. The firm plans to continue investing in technology and AI capabilities while working to rebuild trust following the scandal.
At Inspirepreneurs Magazine, covering entrepreneurship, business failures, and the human stories behind the world's most ambitious founders. She writes at the intersection of strategy and storytelling.
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