KPMG Australia has faced renewed scrutiny after revealing in its delayed annual partner remuneration report that key figures implicated in recent scandals retained their financial status and partner rankings. The report, released late Monday evening, disclosed that Rachel Gatt, the signing partner on KPMG’s failed Macquarie Group audit tender, and Dorothy Hisgrove, the head of human resources involved in the firm’s whistleblower controversy, kept their partner bands unchanged despite broader pay cuts across the partnership.
The report was more than a month overdue and was distributed to partners late in the evening, a timing some insiders interpreted as an effort to limit external attention. A spokesperson for KPMG denied any intention to obscure details around the remuneration of Michael Ebeid, KPMG’s newly appointed chairman and chief executive officer, the firm’s first external appointment to the chairmanship. Unlike previous years, the report did not disclose Mr. Ebeid’s partner pay or employment conditions, a departure from the firm’s customary transparency.
KPMG disclosed earlier to a parliamentary joint committee investigating audit misconduct that Mr. Ebeid will earn $1 million, more than double the salary of the external chair appointed at PwC following its own recent audit scandal. The Macquarie audit contract involved is reportedly worth more than $75 million, making it the largest audit tender in Australia.
During parliamentary inquiries, Macquarie confirmed that Michelle Hinchliffe, a current Macquarie director and former KPMG partner, held multiple meetings with KPMG executives during their bid to replace PwC as Macquarie’s auditor throughout the latter half of 2025. Records show Hinchliffe met then-KPMG chief Martin Sheppard and audit partner Patricia Stebbens, with a planned meeting with audit partner Charles Hatchman that did not proceed. Macquarie ultimately resolved to appoint KPMG, although Hinchliffe did not have a voting role.
The report also highlighted shifts within KPMG’s partnership bands with several senior partners, including Naomi Mitchell and Cassandra Hogan, experiencing pay downgrades. Hogan previously held the national managing partner role for clients and markets before Sheppard’s elevation to chairman. Notably, only four partners now remain at the highest Band 11 level, and for the first time, no female partner has more than ten years’ service.
KPMG’s leadership landscape has dramatically altered in recent months amid governance failures tied to the mishandling of confidential client information to pursue new business and retaliatory actions against the whistleblower who exposed unethical practices. This has resulted in consecutive resignations of KPMG Australia’s CEO, chairman, chief operating officer, and national audit managing partner, alongside the termination of hundreds of employees.
Though Hisgrove and general counsel Louise Capon resigned under pressure in mid-August, both reportedly secured exit packages near $2 million while Hisgrove maintained her Band 11 ranking and continued to be paid by the firm post-resignation. Former CEO Andrew Yates, formerly at Band 12, had departed prior to the close of the financial year and does not appear in the report.
The decision not to demote Hisgrove or downgrade Gatt sparked criticism within and outside the firm, particularly given Macquarie’s recent dismissal of KPMG from its 2027 audit engagement. Gatt’s retained status drew further concern due to her close association with Hinchliffe, raising questions over conflict of interest and the impartiality of KPMG’s appointment for the Macquarie audit contract.
KPMG’s financial pressures appear to be increasing as earnings declined by 10 to 20 percent amidst the fallout, with the firm already contending with high debt levels prior to the audit controversies. With key audit contracts either withdrawn or under significant threat, KPMG’s financial outlook remains uncertain.