Govt accused of wimping it on PWC scandal response

Mike Taylor

Managing Editor/Publisher, Financial Newswire

18 February 2026

The Federal Government has been accused of placing small accounting businesses under pressure by side-stepping imposing the measures necessary to enforce accountability on the accounting and auditing consultancies.

The Institute of Public Accountants (IPA) has expressed its deep concern at the Government’s response to the Parliamentary Joint Committee report on Ethics and Professional Accountability in the wake of the PWC scandal.

The IPA said the Government had failed to adopt the key recommendations for reform that were needed to address misconduct in large firms.

It said the Government’s response to the PJC report had noted, rather than accepted, the committee’s recommendations aimed at improving governance, transparency and accountability within large partnerships.

It noted that those recommendations included proposals to limit partnership size, introduce a suitable penalty regime calibrated to the seriousness of the misconduct, protect the term ‘accountant’, create a consultancy code and strengthen whistleblower protections.

IPA Chief Executive Officer Andrew Conway said the Government had missed a critical opportunity to fix the underlying issues exposed through the inquiry.

“Australia cannot continue to punish the small and suburban practitioner sector for failures originating in the largest firms. The PJC provided a clear and practical roadmap for reform — yet the Government has sidestepped the very measures needed to restore trust and accountability,” Conway said.

He said small tax practitioners are already dealing with escalating compliance obligations, extended investigation timeframes, and mounting administrative pressure.

“Tax agents now have breach reporting obligations requiring them to form judgments about others’ professional conduct. In addition, we have eight new Code requirements, including onerous obligations to disengage from a client or report a client to the ATO. The imbalance in the regulatory burden continues to grow, while the systemic issues identified at the top end of town remain largely unaddressed.

“Small practitioners are carrying a disproportionate regulatory load, with no corresponding action to address misconduct where it actually occurred. This is discouraging new entrants, exhausting existing practitioners, and weakening the profession’s long‑term sustainability,” Conway said.

The IPA is calling on the Government to revisit the PJC’s recommendations and take decisive steps toward structural reform.