Australia is considering major reforms to the accounting sector, including a possible break-up of the Big Four firms and bringing them under the supervision of the corporate regulator. The Treasury options paper proposes reducing the maximum partnership size to 400 from 1,000, mandatory audit firm rotation, and structural separation of audit and consulting operations to reduce conflicts of interest. The review follows scandals such as the 2023 PwC tax leaks case and whistleblower allegations against KPMG. The Big Four audited 96% of Australia's top 200 companies in 2022 and are currently structured as partnerships not overseen by the Australian Securities and Investments Commission. Deloitte, EY, and PwC have expressed willingness to engage with the consultation.
Proposed reforms include structural separation of audit and consulting, reducing partnership size, and mandatory audit rotation, directly affecting KPMG's operations.