KPMG Australia is cutting about 5% of its workforce as the accounting firm responds to weaker consulting demand, government contract losses and reputational damage from a scandal involving confidential client information.
The reduction will affect 27 partners and around 360 employees, with most cuts concentrated in consulting and business services. The move comes as the firm restructures operations and tries to rebuild confidence among government and corporate clients.
KPMG Australia’s revenue fell 1% to AUD 2.26 billion, equivalent to about USD 1.6 billion, in the year ended June 2026.
Consulting revenue dropped 17%, partly driven by lost government contracts. However, four of the firm’s five divisions still recorded growth.
Deal advisory and infrastructure revenue increased 3%, while tax and legal revenue rose 11%. Audit and assurance also grew 11%, and the mid-market and private division advanced 6.4%.
Average equity-partner pay declined 13% during the year as KPMG reviewed costs.
KPMG Australia has faced scrutiny since whistleblowers alleged in March that staff used confidential information to help secure lucrative audit contracts.
The controversy has already triggered several senior departures, including the former chief executive officer, audit head, chairman and senior audit partners.
John Sams, who became KPMG Australia’s CEO last month, acknowledged the damage.
“We recognise the challenges created by our own failings, and the work we must continue to do to rebuild trust,” Sams said in a statement cited by Reuters.
According to KPMG Australia, economic growth is expected to remain subdued until at least 2028, limiting client investment and extending decision-making timelines.
“While these conditions are likely to persist, we remain focused on what we can control,” Sams said.
The firm has also agreed not to bid for new federal government work until September 30, while reviews into its governance, culture, ethics and integrity continue.
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The Australian government is considering broader reforms to the accounting sector, including whether firms such as KPMG, Deloitte, EY and PwC should face tighter corporate oversight.
KPMG’s workforce reduction therefore reflects more than weak demand. It also shows how governance failures can quickly translate into lost contracts, leadership changes and pressure on profitability.