KPMG Australia Lays Off 400 Amid Revenue Drop & Scandal

KPMG Australia is cutting 400 jobs, approximately 5% of its total workforce, as the firm faces declining demand and the fallout from a significant scandal.

The layoffs impact 360 staff and 27 partners, primarily within its consulting and business services divisions.

Key Figures from KPMG Australia

• Workforce reduction: 400 employees
• Percentage of total workforce: 5%
• Overall revenue decline: 1% to A$2.26 billion (year ending June)
• Consulting revenue drop: 17% to A$632 million
• Average equity partner pay reduction: 13%

This decision follows a 1% drop in the firm’s total revenue for the year ending June, alongside a steeper 17% decline in consulting revenue. Weak economic conditions and challenging market dynamics are cited as contributing factors.

Scandal’s Lingering Impact

Adding to the challenges is a controversy involving allegations that KPMG partners misused confidential client information from property group Lendlease. This misconduct led to the departure of several senior leaders, including former chief executive Andrew Yates and former chairman Martin Sheppard.

New chief executive John Sams anticipates subdued economic growth stretching until at least 2028. He highlighted the increasing influence of artificial intelligence, reduced government spending on consultants, and ongoing governance issues as key contributors to this outlook.

Regulatory Scrutiny Intensifies

The firm is actively working to rebuild trust, with internal and external reviews underway. The scandal has also prompted a parliamentary inquiry, led Lendlease to seek a new auditor, and spurred the Australian government to propose stricter oversight and new penalty powers for the consulting sector.