ASIC Scrutinises Big Four Audit Firms After KPMG Allegations
Synopsis
Australia's corporate watchdog has launched a surveillance review of the nation's largest audit firms in response to internal complaints involving KPMG.
Australian regulator has initiated an investigation of large accounting firms in the country in response to claims against KPMG that raised concerns about the handling of complaints associated with audits.
ASIC stated that its new surveillance program will look into the complaint management process at KPMG, Deloitte, EY and PwC, as a result of the investigations into claims about confidentiality breach in relation to audit service provision.
The decision has been made in response to ASIC's investigations of claims regarding improper use of confidential information by KPMG partners in its competition for audit engagements.
According to the regulator, the aim of the surveillance is to determine whether firms have an effective system in place for receipt, investigation and resolution of complaints from whistleblowers.
According to ASIC Chair Sarah Court, the regulator has more power in relation to individual registered auditors compared to the audit firms, most of which exist in the form of partnership. She stated the need for legislative change to improve ASIC's regulatory powers in relation to audit firms.
Governance concerns place audit sector under pressure
This review is against the backdrop of increasing regulation and supervision of the accounting industry in Australia, due to some governance problems at some of the prominent firms. Earlier this year, there was an admission by KPMG Australia of the problems with the way they managed a whistleblower report after an internal review.
After the review, chief executive officer Andrew Yates and audit chairman Julian McPherson left their jobs at KPMG, following another previous internal review which had concluded there were no wrongdoings.
Another indication of rising regulation of the sector is through the procurement figures of the government. According to Reuters' review of the Australian government figures, new federal contracts won by the Big Four accounting firms have fallen to A$348 million in 2025 from A$637 million in 2024.
Global focus on audit quality
The recent regulatory development in Australia is consistent with the increased emphasis at the international level regarding the regulation of audits. According to the IFIAR 2025 Annual Inspection Findings Survey report published in 2026, issues related to audit quality and firm quality management remain top areas of concern for regulators in over 50 jurisdictions, including the US, UK, Canada, Japan, Singapore and Australia.
According to ASIC, its current monitoring program relates to how complaints are handled instead of the quality of audit services. Neither Deloitte, nor EY and PwC have been accused of any wrongdoing by ASIC.
Source: Capital Brief
Follow Inspirepreneur Magazine for daily global business news.
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
You Might Also Like
PwC’s HK$128M Evergrande deal faces court test as liquidators push back
Alok Kulkarni’s Journey: Transforming Customer Experience with Cyar
