‘A serious matter’: KPMG agrees to withdraw from Victorian government contracts

The Victorian government has told Accounting Times that it has banned KPMG from having contracts with its government body.

The state’s Department of Services has issued a show-cause notice to KPMG, calling recent events concerning the firm “a serious matter”, putting a stop to all KPMG contracts.

In a statement provided to Accounting Times, a Victorian government spokesperson said: "KPMG has agreed not to participate in new Victorian Government tender processes while a review is underway, and to withdraw from current tender processes."

The Department of Finance opened an independent review into the firm on 24 June 2026, which will lead to a written report being published on 30 September 2026.

KPMG signed a deed of undertaking with the Victorian government not to use personnel involved in the audit leak, not bid for new Victorian government work until the written report is published, and to withdraw from current tender processes with the Victorian government unless the tender relates to the delivery of an urgent requirement, specific unique capability or continuity of services previously delivered.

Before KPMG’s undertaking with the Victorian government, it was awarded a contract with the Department of Education to create a reporting tool. KPMG was previously appointed as Ports Victoria’s taxation services provider, a relationship which has now been concluded following the review into the firm’s contracts, which was announced by the government on 2 June 2026.

This immediately follows the promotion of former KPMG chief financial officer and chief operating officer John Sams to the firm’s new chief executive officer.

Last week, a parliamentary joint committee inquiry urged Prime Minister Anthony Albanese to accept recommendations it made in 2017 and 2024 to address whistleblower protection issues within current legislation, which Assistant Treasurer Daniel Mulino said is “fraught” with complexity and uncertainty.

The former KPMG employee who blew the whistle on the firm told former national managing partner of assurance, Julian McPherson, of numerous partners engaged in bullying-type behaviour.

This follows inquiries into KPMG’s dealings with confidential information, conflict of interest and its treatment of the whistleblower following senator Deborah O’Neill’s address to the Senate in 2024.

Treasury will continue its consultation on the regulation of accounting, auditing and consulting firms in Australia until 12 August.