Lendlease is poised to end its 68-year audit relationship with embattled consulting group KPMG after learning that one of the firm’s auditors illicitly accessed its boardroom documents.
Lendlease on Monday revealed its audit contract with KPMG was under review, and sources said the company was beginning the significant process required to change auditors.
“It is not appropriate to make a change in auditors this close to financial year end. We will be reviewing our audit services following the completion of FY26 reporting,” a Lendlease spokesperson said on Monday.
In March, Lendlease chief executive Tony Lombardo told KPMG the actions of its employees were “not acceptable” when the firm confirmed boardroom documents were accessed. KPMG admitted to this only after Labor Senator Deborah O’Neill revealed whistleblower allegations in parliament. KPMG was paid more than $10 million last year for its services to Lendlease.
Lendlease, a construction giant, is the first major corporate client to put its relationship with KPMG under review, as the accounting and consulting group grapples with an escalating crisis spared by a whistleblower’s complaint.
KPMG Australia boss Andrew Yates and senior partner Julian McPherson abruptly resigned on Friday after the company confirmed confidential client data had been shared, and potentially used to win new business with other clients, following explosive claims from a whistleblower.
The allegations at KPMG have echoes of the tax leaks scandal at rival PWC, where partners at the firm allegedly used confidential government tax plans to help multinational companies avoid the new scheme.
PWC was forced to spin off its government business and slash staff and is still losing business to rivals such as KPMG due to the scandal. This included audit services at Westpac which KPMG won in 2024.
In a letter to O’Neill’s Parliamentary Joint Committee (PJC) which is looking into the whistleblower scandal, Westpac board audit committee chair Peter Nash and chief executive Anthony Miller said they were “concerned to hear of the matters raised” and had requested further information from KPMG.
Next year, KPMG is due to take over the Brambles and Macquarie Group audit work from PWC as well as Wesfarmers. Macquarie’s audit work is the most lucrative in Australia with revenue of up to $75 million a year.
Macquarie and Westpac declined to comment on KPMG’s appointment to conduct their audits. Wesfamers and Brambles have been approached for comment.
O’Neill’s PJC is expected to conduct a public examination this month and demand access to all of KPMG’s investigations conducted over the past two years into the whistleblower allegations which found no evidence of wrongdoing.
KPMG chairman Martin Sheppard requested a closed-door hearing, which the PJC has yet to formally decide on, but O’Neill expressed her opposition to this.
“That’s an insult to the parliament, and it reveals, yet again, KPMG simply don’t know the way the parliament works, and it’s time they showed it the respect that it deserves,” she said.
The anonymous whistleblower from KPMG first made a complaint in 2024 with dozens of allegations, including that KPMG partners illicitly accessed board papers from their client, Lendlease, which were used to win lucrative audit work at Westpac and Dexus.
Lendlease said KPMG first made it aware of whistleblower allegations in May last year – that sensitive board papers had been accessed by its audit partners to win work with other clients – but KPMG said it was satisfied there was “no issue”.
After O’Neill aired the whistleblower allegations in March, KPMG told Lendlease that one of its audit partners had actually accessed the board papers, but the consulting group deemed the documents to be of “low sensitivity” that gave it “zero competitive advantage”.
KPMG says it is re-investigating the allegations via law firm Allens which is “continuing to challenge the conclusions reached in prior investigations.”
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Colin Kruger is a senior business reporter for the Sydney Morning Herald and The Age.Connect via email.