Big Four audit firm KPMG is facing an internal communications meltdown, City AM understands, amid complaints of a lack of transparency during a 'mismanaged' redundancy round. In late March, reports emerged that KPMG UK was set to axe more than 500 staff, including 440 assistant manager roles in the audit business and 120 roles across the advisory arm, impacting roughly 6 per cent of the division's 7,100 employees.
Employee Frustration Over Communication Breakdown
One source within the consultation scope told City AM that there was initially a lack of internal communication about the cuts. 'We only got news of the advisory side, so when the news came out that it was 600 jobs… oh, audit has been hit as well,' the source said. They added that KPMG 'didn’t do like a firm-wide email being like “this is what’s happening with the firm.”'
Another source stated that there has been a lot of 'mismanagement,' adding: 'One minute, there is an email saying the business is doing well; the next, there is an email saying people will be laid off.' City AM understands there is widespread frustration within the firm over how it is handling the round of job cuts.
KPMG's Response
A KPMG spokesperson said the firm 'continues to support our people throughout the consultations.' The firm blamed 'current market conditions' for the audit cuts, noting low attrition rates in certain parts of the audit population, and 'ongoing evolving market conditions' for the advisory reductions.
Broader Industry Challenges
KPMG's recent financial results, the first for the merged KPMG UK and Switzerland group, showed 5 per cent growth in audit practice, driven by increased support for integrated AI platforms. However, its advisory group was down 3 per cent due to a 'difficult' global environment. The Big Four have all struggled with stagnant profits and ballooning headcount since the pandemic boom, leading to multiple redundancy rounds across the sector.
