KPMG Australia will stop providing its FairCall whistleblower hotline to organisations it audits, as the firm retreats from a service that has become an uncomfortable focal point in the fallout from its own whistleblower scandal.
The firm says the decision is driven by changes to Australia’s fraud auditing standard rather than the controversy engulfing KPMG. But the timing is notable: KPMG informed the Reserve Bank of Australia that it would not renew its FairCall contract less than a day before it emerged that the central bank was itself reviewing the arrangement following KPMG’s whistleblower failures.
The decision was disclosed in correspondence released by the RBA under freedom of information laws.
In an email sent to the RBA at 6.01pm on 2 June, KPMG said its Ethics and Independence Team had reassessed whether FairCall could continue to be provided to external audit clients following the introduction of a revised ASA 240 fraud auditing standard.
The revised standard, issued by the Auditing and Assurance Standards Board in October 2025, applies to financial reporting periods beginning on or after 15 December 2026. Among other changes, it requires auditors to obtain an understanding of a client’s whistleblower programme and assess its design and effectiveness.
KPMG told the RBA that this meant FairCall could no longer be offered to external audit clients, “primarily due to a self-review threat”.
The issue is that an audit firm operating a client’s whistleblower service could subsequently be required, as auditor, to assess a system in which it was itself involved.
The RBA is directly affected because KPMG performs work on the central bank’s financial statement audit under engagement by the Australian National Audit Office while also operating its FairCall integrity reporting service.
KPMG said it could continue providing FairCall until the RBA contract expires on 31 December 2026 because the new audit requirements would not yet be effective, but could not renew the arrangement beyond that date.
A service under scrutiny
The technical independence issue has emerged at an exceptionally awkward moment for KPMG.
The firm has spent months dealing with the fallout from a whistleblower scandal that exposed failures in its handling of allegations concerning the misuse of confidential client information.
On 29 May, KPMG itself acknowledged that its treatment of the whistleblower and its investigation into the allegations had fallen short. The firm said its initial investigation had not been conducted with the necessary rigour and identified shortcomings in the management of the whistleblower, the investigations and leadership’s response to the allegations.
Chief executive Andrew Yates and national managing partner for audit and assurance Julian McPherson resigned as KPMG apologised “unreservedly” to the whistleblower.
That admission created an obvious reputational problem for FairCall, the whistleblower service KPMG sells to other organisations.
Labor senator Deborah O’Neill subsequently described KPMG continuing to provide corporate whistleblower services as “an untenable proposition”.
Greens senator Barbara Pocock later called for KPMG to be barred from providing whistleblower hotline services while the scandal was investigated. By then, Newcastle Greater Mutual Group and Police Bank were reviewing their FairCall contracts, Western Sydney International Airport was considering its position, Vodafone was seeking assurances and Marinus Link was monitoring developments.
The RBA was also moving away from KPMG. Governor Michele Bullock told a Senate committee on 4 June that the bank was retendering FairCall and said: “I don’t think we’ll be reappointing them to the whistleblower service.” ABC reported that the RBA was distancing itself from KPMG amid the scandal.
Did KPMG jump before it was pushed?
The chronology disclosed by the RBA leaves an obvious question over whether KPMG’s decision also allowed it to get ahead of FairCall relationships that were already becoming vulnerable.
The released RBA emails show that on 29 May, shortly after KPMG publicly admitted its whistleblower failures, an RBA executive asked colleagues whether the development should prompt consideration of the other services KPMG provided, specifically listing “Fair Call” and immigration services.
Four days later, on the evening of 2 June, KPMG sent the RBA its email saying FairCall could no longer be provided to external audit clients. Significantly, the email began “As discussed”, showing there had already been communication between the parties about the issue.
Less than a day later, Capital Brief reported that the RBA was reviewing its FairCall relationship.
When it subsequently reported KPMG’s ASA 240 explanation, Capital Brief noted that the KPMG emails had been sent less than a day before it revealed the RBA’s intention to cease the FairCall contract and said it was unclear whether telephone conversations had occurred beforehand.
The explanation has also attracted scepticism elsewhere. Writing in The Mandarin, Tom Ravlic characterised the standard change as “another excuse” for KPMG to stop selling whistleblower services to audit clients.
There is, however, no evidence in the released documents that the RBA had told KPMG before the 2 June email that it had decided to drop FairCall, or that KPMG invoked ASA 240 in order to pre-empt being removed.
And the independence issue itself is not retrospective justification invented after the scandal. The revised ASA 240 was issued in October 2025, months before KPMG’s whistleblower controversy erupted publicly.
What the documents do show is that two developments were occurring simultaneously: KPMG had concluded that new auditing rules prevented it from continuing FairCall for audit clients, while some of those same relationships were coming under pressure because of the firm’s own treatment of a whistleblower.
KPMG will continue to offer FairCall to organisations it does not audit, according to Capital Brief, so the firm still has to address the wider reputational question that has dogged FairCall since the scandal began: whether organisations should entrust their whistleblowers to a firm that has admitted serious failures in dealing with one of its own.
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