KPMG Australia CEO Andrew Yates has resigned with immediate effect after accepting responsibility for the company’s failure to properly address whistleblower claims about misuse of client information.
In a statement, KPMG said that its chairman, Martin Sheppard, has accepted the resignation. Yates, who was appointed in 2021, will be replaced on an interim basis by partner Stan Stavros.
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Yates said: “I have been committed to a speak-up culture in our firm, it is clear that in this case we have let ourselves down and I take accountability.”
Additionally, national managing partner of audit and assurance Julian McPherson will also step down and leave the firm “after an orderly transition of his client responsibilities”.
The moves follow allegations first outlined under parliamentary privilege by Senator Deborah O’Neill on 24 March in the Senate, the Guardian reported.
It was alleged that the accounting company improperly handled the confidential information from client Lendlease to secure audit work with Westpac and Dexus, and failed repeatedly to act on the whistleblower’s concerns.
KPMG has conceded its internal handling fell short.
KPMG Australia said: “KPMG Australia confirms its treatment of a whistleblower and investigation into their allegations fell short of the firm’s expectations, those of the whistleblower and the broader community.
“The initial internal investigation, that did not substantiate the allegations raised by the whistleblower, was in hindsight not conducted with the necessary rigour required.
“Understandably this prompted further communications and allegations from the whistleblower, resulting in the appointment of an external legal firm, to review the internal investigation.”
The company added that a Board Sub-Committee led by the deputy chair has appointed Allens to conduct an external legal investigation. This probe is currently under way.
“Now, with new evidence and an expanded scope, Allens are continuing to challenge the conclusions reached in prior investigations,” the statement added.
Meanwhile, the Australian Securities and Investments Commission (Asic) is also conducting a probe into allegations concerning the conduct of several registered company auditors at KPMG.
According to the Guardian report, the latest case comes after PricewaterhouseCoopers was banned from government contracts following allegations that partners used confidential government briefings to help clients respond to new tax rules for multinationals.
