KPMG to Cut 10% of US Audit Partners After Early Retirement Plan Falls Short

Global accounting firm KPMG plans to cut nearly 10% of its audit partners in the United States of America (USA) after efforts to encourage early retirement did not work as expected.

The move shows the pressure on firms to adjust their workforce based on current business needs.

Retirement Plan Did Not Work

KPMG had offered early retirement deals to senior audit partners for several years. The goal was to reduce the number of leaders without forcing exits. However, not enough partners chose to leave.

Because of this, the firm will now cut about 100 partners from its audit and assurance unit in the US. This group has around 1,400 partners and managing directors, so the change is significant.

Matching Staff Size With Business Demand

KPMG said the cuts are meant to better match the number of partners with the size of its audit business. The firm made it clear that the decision is not based on how well individuals performed. Instead, it is about making the organization run more smoothly.

The firm still audits close to 10% of companies registered with the Securities and Exchange Commission. However, it remains behind rivals like Deloitte, EY, and PwC in market share.

Uncommon Step for the Industry

Cuts at the partner level are rare in the accounting and consulting world. Partners usually own part of the firm and play a key role in leadership.

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Letting them go can be complex and costly, which makes this decision stand out.

A Wider Shift Across the Industry

This move reflects a wider shift among the “Big Four” firms. During the pandemic, they hired more people, but now growth has slowed and fewer employees are leaving on their own.

KPMG’s decision shows that even top roles are not safe from changes. Firms across the industry are adjusting their teams to stay efficient and meet new market conditions.

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