SYDNEY: A scandal-hit KPMG Australia is cutting 387 jobs as the accounting firm struggles with a steep drop in consulting demand, lost government contracts and ongoing scrutiny over its handling of confidential client information and a whistleblower complaint.
The layoffs, announced Monday, affect about 5% of KPMG Australia’s workforce and include 27 partners and roughly 360 employees. Most of the cuts will come from consulting, where revenue has fallen sharply, while some business services positions will also be eliminated.
KPMG reported revenue of 2.26 billion Australian dollars ($1.47 billion) for the financial year ended June 30, down from 2.28 billion Australian dollars a year earlier.
Chief Executive John Sams, who took over in July, said the firm expects difficult market conditions to continue into the 2026-27 financial year and beyond.
“We expect difficult market conditions to continue in FY27 and beyond,” Sams told staff. “Economic growth is expected to remain subdued until at least 2028, affecting client investment and extending decision-making timeframes.”
Sams also acknowledged that KPMG’s own conduct had contributed to the firm’s difficulties.
“We also recognise the challenges created by our own failings, and the work we must continue to do to rebuild trust,” he said.
KPMG’s consulting revenue fell 17% to 632 million Australian dollars in fiscal 2026, down from more than 1 billion Australian dollars three years ago. The decline contrasts with growth in most of the firm’s other divisions.
Audit and assurance revenue rose 11% to 405 million Australian dollars, while tax and legal revenue increased 10.9% to 268 million Australian dollars.
The restructuring will combine KPMG’s mid-market and private agreements team with deal advisory and infrastructure, while its advisory team will join consulting. The changes are designed to bring the Australian business closer to KPMG’s global advisory structure.
The job cuts come as KPMG faces continued scrutiny over allegations that partners misused confidential client information and mishandled a whistleblower complaint.
In March, Labor Sen. Deborah O’Neill raised allegations in Parliament that confidential Lendlease board papers had been used to support bids for major audit contracts involving Westpac and Dexus.
Current and former KPMG partners later appeared before a federal parliamentary inquiry examining the allegations and the firm’s handling of the whistleblower complaint.
The fallout has also cost KPMG government business. The firm has been barred from applying for federal government contracts until at least the end of September, when the Department of Finance is expected to complete its review. Several state governments have also suspended KPMG from procurement panels.
The disruption could have broader implications for companies that rely on KPMG for risk advisory, regulatory compliance, governance, actuarial and internal audit services. Insurers and other financial institutions with ongoing engagements may need to assess whether the restructuring will affect their work.
KPMG’s difficulties also highlight the wider risks professional services firms face when whistleblower complaints and governance failures escalate into regulatory investigations, reputational damage and the loss of major clients.
Despite the consulting downturn, four of KPMG Australia’s five divisions recorded revenue growth during the year. The firm said it remains focused on restructuring the business, supporting affected employees and rebuilding trust.
“Our immediate focus is on treating everyone impacted with care, dignity and respect,” Sams said. “We are providing practical support and making wellbeing support central to the process.”
