Purpose
This Procurement Policy Note is to advise Commonwealth procurers of the mutual agreement between the Department of Finance (Finance) and KPMG Australia (KPMG) that KPMG will not bid for any new Commonwealth work until 30 September 2026.
Context
Finance is responsible for managing the Commonwealth’s response to the ethical concerns arising from KPMG’s use of confidential client information, and forming a whole-of-government view on KPMG’s ethical soundness. To support Finance’s consideration, Finance will commission an independent review of KPMG’s governance, culture, ethics and integrity frameworks. Further details regarding the review will be made available in the coming weeks.
KPMG has agreed with the Commonwealth that, during the period of the review, KPMG will temporarily cease new contract engagements with Australian Government entities subject to the Commonwealth Procurement Rules (CPR) until 30 September 2026.
Under this agreement, Commonwealth officials should not enter into any contracts with KPMG for any approaches to market which close between 16 June and 30 September 2026. This agreement captures new engagements (including under whole-of-Australian-Government Panel arrangements), and / or new contracts with a third party which include KPMG being appointed as subcontractors to that third party.
Non-CPR covered entities are recommended to adopt a consistent approach and cease any new engagements with KPMG between 16 June and 30 September 2026.
This agreement to cease new contract arrangements does not apply to:
- existing contracts with KPMG, including the exercise of extension options within those contracts;
- the ongoing licensing or sale of KPMG proprietary products1 currently in use by Australian Government entities; and
- proposals submitted by KPMG prior to the date of the mutual agreement to pause (16 June 2026).
However, entities should continue to be mindful of the requirements to consider relevant experience and performance history, including ethical performance, when assessing value for money in all procurements, and the need to monitor the ethical behaviour of suppliers throughout the term of any contract. The Procurement Policy Note - Update to Ethical conduct of tenderers and suppliers contains further guidance for procuring officials.
When managing existing KPMG contracts entities should:
- seek assurance from KPMG that no individuals engaged on existing contracts are associated with the matters being reviewed;
- consider, if any individuals associated with existing contracts are identified as linked to these matters, whether additional risk mitigation steps may be required; and
- note that for most contracts, there are contractual rights to request the removal of specific personnel from contracts. Entities should seek legal advice where necessary.
Further Advice
Finance will provide further advice in due course regarding the operation of the independent review.
At the conclusion of the agreement period, Finance will provide an update to entities on the status of the cessation.
Further questions relating to these matters can be directed to ethicalsourcing@finance.gov.au.
1In some circumstances, KPMG provides licensing options to clients such as SAAS products, the reselling of third party software or licensing technology products. KPMG also directly licence tools and models to agencies under annual or three year licence arrangements. These include the Accelerated Reporting Model, Lease Reporting Model and Central Reporting Model used by a range of departments and agencies to meet their financial reporting obligations.
