In evidence to a committee, the Australian Securities & Investments Commission described the alleged misuse of confidential information by auditors as a serious breach of trust that strikes at core obligations of integrity and honesty in the profession. It said the issue goes to the heart of market integrity because companies must be able to disclose sensitive information to auditors with confidence. ASIC also confirmed it has formal investigations underway into the conduct of individual registered company auditors within KPMG in relation to two separate matters involving the potential misuse of Lendlease confidential information and the alleged misuse of Optus confidential information. ASIC said the cases highlight major gaps in the regulatory framework for audit firms. Its current jurisdiction over audit partnerships is limited to investigating individual registered company auditors and only in relation to their conduct of an audit, which it said is too narrow. It reiterated calls for the Corporations Act to extend to large partnerships and for sanctions for breaches to be significantly increased. The commission also said whistleblower protections should clearly cover disclosures about the conduct of partnerships such as KPMG, and argued that adding company-style governance features to partnership structures has not provided meaningful oversight of accounting firm leadership. It added that privilege claims are a recurring obstacle in investigations, consuming resources and contributing to delays.
Australian Securities & Investments Commission2026-07-09
Australian Securities & Investments Commission says KPMG matters expose regulatory gaps and confirms two formal investigations
In committee evidence, the Australian Securities & Investments Commission said the KPMG matters point to serious breaches of trust by auditors and confirmed two formal investigations involving the alleged misuse of Lendlease and Optus confidential information. ASIC said its powers over audit partnerships are too limited, called for broader Corporations Act coverage and stronger sanctions, and argued that whistleblower protections for disclosures about partnerships are deficient.