KPMG Australia will cut 360 employees and 27 partners from its workforce, the company announced on Monday, as the scandal-hit accounting firm reported falling revenue and warned that weak economic conditions and reduced government work would continue to weigh on its business.

The Australian operation said its total revenue fell 0.9 per cent to A$2.26 billion in the financial year ending June 2026, while consulting revenue dropped 16.9 per cent following its exclusion from new federal government contracts over the misuse of confidential client information.

KPMG Australia chief executive John Sams said the firm expected “difficult market conditions to continue in FY27 and beyond”, with economic growth likely to remain subdued until at least 2028. Most of the job reductions will come from the consulting and business services divisions as the firm restructures parts of its operations.

Sams, who became chief executive last month, said KPMG recognised the “challenges created by our own failings” and the work required to rebuild trust. The scandal has led to the departure of KPMG Australia’s former chief executive, audit boss and chairman, alongside several senior audit partners.

The cuts come after whistleblower allegations that KPMG staff used confidential client information to help secure lucrative audit contracts. KPMG has acknowledged that it mishandled an earlier whistleblower complaint and has launched further internal and external reviews into its governance, culture, ethics and integrity.

A parliamentary inquiry heard earlier this month that further whistleblowers had come forward with allegations of similar misconduct. Senator Deborah O’Neill, who chairs the inquiry, said there were “many, many more” people reporting concerns about repeated behaviour at the firm.

The financial impact has extended beyond consulting revenue and staffing. KPMG said average equity partner pay fell 13 per cent during the year, while the firm has agreed not to bid for new federal government work until 30 September as reviews into its conduct continue.

Four of KPMG Australia’s five divisions recorded revenue growth during the year, including an 11 per cent increase in both its tax and legal and audit and assurance businesses. The firm said it would simplify parts of its structure and create more integrated teams aligned with KPMG’s global advisory operations.

The Australian government is considering wider reforms to the Big Four accounting firms, including changes to their partnership structures and potential separation of audit and consulting operations. The government has previously raised the possibility of breaking up the sector following a series of scandals involving major professional services firms.

---