[Australia] KPMG prepares to cut hundreds of staff amid leaks scandal

Jul 14, 2026

KPMG is preparing to cut hundreds of jobs and reduce partner pay by as much as 20 per cent, as the fallout from the audit leaks scandal hits the big four firm’s bottom line.

Senior leaders at the firm, which has about 9000 staff and 700 partners, are scrutinising client bookings to gauge the scale of the hit to its pipeline of work and are examining ways to offset this by cutting costs.

The redundancies are likely to be spread across the firm. KPMG’s public-sector arm has already agreed not to bid for new Commonwealth and NSW public sector work until the end of September, while private-sector demand has also fallen.

The job cuts are yet to be finalised, but management’s current thinking is that there will be at least several hundred.

Two sources close to the firm, but not authorised to speak about internal matters, said the number of redundancies could reach or even exceed 1000.

Any cuts will not be announced until the firm appoints a permanent chief executive in the coming weeks.

Top contenders for the job include head of tax and legal Ben Travers, and head of mid-market and private businesses Naomi Mitchell, although chief financial officer John Sams has firmed as the favourite.

New hearing

Another unenviable task awaiting the new chief executive will be appearing before the parliamentary committee investigating the audit leaks scandal. Another hearing is scheduled for August 14.

A KPMG spokesman said the firm was evaluating “a range of options to ensure the firm remains well positioned for the challenges ahead”.

This included “reviewing our operating model, cost base and workforce needs” as part of its planning for the 2026-27 financial year, but that no decisions had yet been made on specific measures.

“We recognise that discussions of this nature can create uncertainty, and as decisions are made, we will communicate with our people first and in a respectful way,” said the spokesman.

“Our focus remains on providing high-quality service to our clients, supporting our people, and making responsible decisions that position the firm for a sustainable future.”

KPMG staff say there has been an intense focus on forward bookings. One noted that, in the past few weeks, senior staff had been asked to go through “each employee’s bookings, line by line”.

“I think honestly they are pressing [for] redundancies,” said the senior staffer.

Another staff member said that staff were looking for new jobs with renewed intensity amid concern that the market would be flooded if they waited until after redundancies.

Management ‘reviewing’ operating model

Michael Ebeid, who is currently a special adviser to the firm and is the board’s pick as its new chairman, also emailed partners this week saying its management was reviewing its operating model, costs and staff needs.

Ebeid has fielded questions on this as part of his national roadshow of KPMG’s offices, which started last week and continues, but his answers have aligned with the information in that email.

In late June, Sams told partners that their pay for the 2026-27 financial year would be down as much as 13 per cent. However, many partners believe this figure will be about 30 per cent, based on current work forecasts.

A few partners have also been told the broader partnership’s pay for the 2026 financial year could be cut by 20 per cent, instead of an already-flagged 10 per cent.

That would amount to average losses of $144,000 based on average annual partner distributions of $717,000 for 2024-25.

Several valuable partners responsible for bringing in significant revenue have left the firm since the scandal hit, especially from its consulting and government advisory arms.

They include Evan Rawstron, who managed more than $100 million in contracts and was once touted as a likely senior leader. He is leaving to join a UK boutique firm.

Professional services firms globally are cutting costs as artificial intelligence threatens their business models and reduces demand for their advice.

KPMG cut 200 executive assistant roles in February, before the current scandal even hit, offshoring the work to the Philippines for an annual saving of $17 million.

[Australian Financial Review]