KPMG cuts 100 audit partner roles, says need to align team skills and size

KPMG is cutting around 100 US audit partners as part of a plan to better match its workforce with current business needs. The move follows unsuccessful attempts to reduce numbers through voluntary retirements.

In Short

• Around 100 audit partners in the US are set to exit as part of restructuring
• The decision is not linked to performance, but to team size and business alignment
• The partners will receive financial payouts and transition support

KPMG is reducing its senior workforce in the US, with close to 100 audit partners set to leave the firm as it looks to rebalance its team structure. The decision comes after internal discussions suggested that the current number of partners is higher than what the business presently requires, especially in its audit division. "This action is connected to a multiyear strategy to align the size, shape and skills of our team," the company said in a statement.

Interestingly, the move comes after the company's longer attempt to ease out senior members through voluntary retirement programmes. However, those efforts did not see enough participation, reportedly forcing the company to take a more direct approach. People aware of the development told Financial Times that while a few partners have chosen to exit on their own, others have been informed about their departure as part of this exercise.

This step is not tied to performance concerns, but rather to how the firm wants to re-align its workforce. With around 1,400 partners and managing directors in its US audit practice, KPMG is now adjusting the mix to better match current demand and future plans. Managing directors, however, are not part of this round of cuts.

KPMG links cuts to restructuring plan

Explaining the decision, KPMG said the changes are part of a longer-term effort to redesign its audit business. "This action is connected to a multiyear strategy to align the size, shape and skills of our team to the power of our audit platform to best serve our clients and protect the capital markets," the company detailed in a statement. It also noted that the overall strength of its partner base remains intact and that there will be opportunities to bring in new partners over time.

Partners who are exiting will be offered financial payouts along with assistance in finding new roles. The firm said this support is aimed at recognising their contribution and helping them move into the next phase of their careers.

Such actions are not very common at the partner level in the consulting and accounting industry. Unlike regular employees, partners typically have an ownership stake in the firm, which makes their exit more complex. Companies often need to compensate them for that stake, along with additional payouts depending on experience and tenure.

The development also fits into a larger pattern seen across the Big Four firms, which include Deloitte, Ernst & Young, and PwC. According to WSJ, many of these firms are now adjusting their workforce after hiring aggressively during the pandemic years, when demand for services was much higher. As business conditions stabilised, the expected level of employee exits did not happen, leaving firms with larger teams than needed.

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