Overview
Australian lawmakers on Friday pressed KPMG executives over allegations that confidential board documents from real estate company Lendlease were misused to support bids for audit tenders at Westpac and Dexus. The hearing - convened by a joint parliamentary committee on corporations - followed a whistleblower complaint that has precipitated senior departures at KPMG and prompted the firm to open a fourth investigation after earlier inquiries failed to substantiate wrongdoing.
Day-long public hearing
Current and former KPMG executives, together with the firm’s lawyers, were called to give evidence in a public session that lasted the day. The exchange placed the spotlight on how the firm handled the whistleblower complaint and on broader questions about whether existing regulatory arrangements for the large accounting partnerships are sufficient.
Allegations and internal response
The whistleblower has accused KPMG of misusing confidential Lendlease board papers to underpin bids for major audit tenders involving Westpac, a large bank, and Dexus, a property firm. Following the allegations, KPMG’s Australian unit saw the resignation last month of CEO Andrew Yates and the firm’s audit chief. KPMG acknowledged it had mishandled the whistleblower complaint and has initiated a fourth investigation after prior probes did not substantiate claims of wrongdoing.
Parliamentary questioning on partnership structure
Greens Senator Barbara Pocock criticised KPMG’s conduct, saying the firm had "leapt over any ethical consideration" in pursuit of commercial gain, and drew parallels to the high-profile PwC tax leaks scandal in 2023. Senator Pocock questioned whether the partnership model - under which the Big Four operate and therefore fall outside supervision by the Australian Securities and Investments Commission - may require change.
She asked, "Is the partnership structure now non-functioning in this circumstance? We are here the second time around, PwC and now you." The partnership structure means these firms are not subject to the same ASIC supervision and reporting obligations as companies, but instead are regulated by state-based laws.
Labor Senator Deborah O’Neill echoed concerns raised about governance and asked whether the problem was limited to individuals or more systemic: "is the whole barrel rotten?"
Executives respond
Andrew Yates, who resigned from his role at KPMG Australia, rejected the notion that the firm or its leadership were broadly corrupt. He said, "I don’t see myself as a bad apple," and added, "And nor do I see the firm to be full of bad apples. We are a large, complex organisation and we’re fallible."
On the handling of the whistleblower complaint, Yates acknowledged delays in informing senior leadership and said he had been reluctant at the time to share the issue with the firm’s 680 partners. Senator O’Neill countered that under a company structure, there would have been an executive explicitly responsible for such matters, noting that the partnership structure means "everybody is responsible for everything that you do, jointly with you."
Treatment of the whistleblower
Committee members heard testimony that after the whistleblower raised concerns internally, their computer was repeatedly searched and they were not provided with legal protections. Paul Scarr, a senator from the Liberal party, said the whistleblower "suffered a horrendous personal, mental and career cost" as a result of KPMG’s actions.
Responding to criticism of the firm’s handling of the complaint, Yates conceded, "we didn’t get it right" and added, "We didn’t make them feel comfortable, as I’ve reflected on the things that led to me resigning."
Implications
The hearing intensified scrutiny of how major accounting firms are regulated and managed internally, and it underscored continuing political and public concern following prior industry scandals. Parliamentary exchanges focused on structural questions about partnership governance, internal accountability mechanisms, and protections for whistleblowers.