Accounting Giant‎ KPMG Axes Dozens Of Partners

Dozens of UK-based partners at the 'big four' accountancy firm KPMG are being let go in a bid to improve its performance and respond to changing demand from its clients.

Sky News has learnt that KPMG is cutting approximately 50 partners - a bold move in an industry more accustomed to evolutionary than revolutionary change.

The process of streamlining its partnership, which will see the number of partners reduced from about 630 to roughly 580, is said to have been under way for several weeks and is expected to continue for some time.

The redundancies form part of a push by Simon Collins, KPMG's widely respected UK chairman, and senior colleagues to overhaul the firm's operating model by investing in technology and other areas likely to deliver long-term benefits.

A source said there was broad support inside KPMG for the changes, with some of the exiting partners at or near retirement anyway.

Like its principal rivals - Deloitte, EY and PricewaterhouseCoopers - KPMG is among the UK's biggest private sector employers‎.

The reduction in the number ‎of partners at KPMG follows a fall in profit to £383m in the year to 30 September, with a modest rise in revenue meaning it was overtaken by EY to become the smallest of the quartet which dominate the industry.

The major firms have seen an increase in the churn of their big audit clients because of new rules requiring listed companies to rotate their accountants.

KPMG's key wins in that area include Barclays (LSE: BARC.L - news) , although it is facing renewed scrutiny ‎from regulators over its audit of HBOS, the bank which needed rescuing by Lloyds TSB during the 2008 financial crisis.

KPMG declined to comment.