Last week, KPMG Australia’s Chief Executive, alongside the leader of the firm’s audit business, resigned after the firm admitted its investigation into whistleblower allegations had fallen short of expected standards, as reported by the Financial Times.
The allegations, aired in parliament by Senator Deborah O’Neill, claimed KPMG staff had accessed confidential board papers from audit client Lendlease to pursue contracts with other companies. A former KPMG audit employee first raised concerns in 2024. An internal investigation and an external legal review each found the claims unsubstantiated. Further contact by the whistleblower has prompted a third investigation by an independent law firm, which is now underway.
Departing CEO Andrew Yates, who had publicly championed whistleblowers following a scandal at PwC in 2023, acknowledged the firm had fallen short. “I have been committed to a speak-up culture in our firm, it is clear that in this case we have let ourselves down,” Yates said.
The Australian Securities and Investments Commission has also opened a formal investigation into the matter.
According to more recent reporting, the firm’s Chief Operating Officer, who was directly named by the whistleblower as having allegedly been involved in the misconduct, has also stepped down. However, she will remain as an audit partner pending the results of the investigations.
In 2023, Starling published “Renal Failure: A Crisis in Audit Culture?,” a Deeper Dive report into global concerns surrounding audit quality and professional conduct. Therein, we discuss the efforts of regulators, including the FRC, to reform audit quality and governance.
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