Pwc vs KPMG

Pwcis the product of two separate Victorian accounting practices. Price Waterhouse was founded in London in 1849 by Samuel Lowell Price and later expanded by Edwin Waterhouse. Coopers & Lybrand was founded by William Cooper in 1854. For nearly 150 years, the two firms were direct competitors — both operating globally, both serving the world's largest companies, both considered among the most prestigious names in the profession.

Price Waterhouse won the audit of U.S. Steel — the world's first billion-dollar corporation — in the early twentieth century, establishing itself as the auditor of choice for America's largest industrial companies. In an era before the SEC existed, the name "Price Waterhouse" on an audit report was the closest thing to a government guarantee of financial credibility.

Price Waterhouse and Coopers & Lybrand completed their merger in 1998, creating Pwc— at the time the largest professional services firm in the world. The merger reduced the Big Six accounting firms to the Big Five. Two firms that had competed for 150 years became one overnight.

At the 89th Academy Awards ceremony in February 2017, PwC accountants mistakenly handed presenters Warren Beatty and Faye Dunaway the wrong envelope. Beatty announced La La Land as Best Picture. Producers and cast members took the stage. Then a PwC representative walked on and announced that the actual winner was Moonlight. The firm had managed the Oscars vote count for 83 years without incident. The two accountants responsible were never allowed to work the Oscars again. PwC retained the contract.

In 2023, PwC Australia became the centre of one of the most damaging scandals in the firm's history. A senior partner had leaked confidential government tax policy information to colleagues, who used it to advise corporate clients on how to avoid new tax rules before they were announced. The scandal triggered parliamentary inquiries, forced the resignation of PwC Australia's CEO, and prompted a global review of how the Big Four's consulting and audit practices conflict with each other.

PwC laid off approximately 5,600 employees globally in 2025 — including 1,500 in the U.S. alone — after global revenue growth slowed to 2.9%, its lowest rate since the pandemic-recovery boom. The firm had aggressively expanded headcount between 2021 and 2023, and with attrition falling sharply, it had more staff than clients demanded. Meanwhile, PwC spent approximately $1.5 billion on AI capabilities between July 2024 and June 2025, attempting to position the firm for a future where AI would do much of the analytical work that had made consulting firms valuable. Advisory revenue grew just 4.5% in 2025. The question facing PwC — and every major consulting firm — was whether AI would eventually replace the human judgment that justified their fees, or whether it would simply be another tool to sell to clients at a premium.

KPMG's oldest predecessor traces its origins to an Amsterdam trading house founded in 1818. The K in KPMG stands for Piet Klijnveld (Amsterdam, 1917); the P for William Barclay Peat (London, 1870); the M for James Marwick (New York, 1897); the G for Reinhard Goerdeler (Germany). It took until 1987 for all four national traditions to unite under a single name that nobody could fully explain.

KPMG was created in 1987 through the merger of Peat Marwick International and KMG (Klijnveld Main Goerdeler). The combined name was chosen because neither side would accept the other's name as primary. Partners from the two legacy firms reportedly maintained their separate cultures and rivalries for years after the official merger. The name itself — four initials representing four men from four countries across two centuries — became the most complex origin story in professional services.

In 2005, KPMG admitted to criminal wrongdoing in connection with fraudulent tax shelters that had helped wealthy clients evade approximately $2.5 billion in taxes. KPMG paid $456 million in fines — the largest criminal tax case in U.S. history at the time — and agreed to a deferred prosecution agreement. The Department of Justice chose not to indict the firm itself, reasoning that doing so would likely destroy it and harm innocent employees and clients, as had happened with Arthur Andersen three years earlier. The "too big to indict" logic that would later apply to major banks was applied here first.

KPMG South Africa became entangled in the "state capture" scandal surrounding the Gupta family's alleged corrupt influence over the South African government during the Zuma administration. KPMG had audited Gupta-linked entities and produced a report used to justify the firing of the country's finance minister. KPMG later withdrew the report, acknowledging it should never have been issued. Seven senior KPMG South Africa partners resigned. The South African Revenue Service terminated its relationship with KPMG.

KPMG audited Silicon Valley Bank and issued a clean audit opinion just two weeks before SVB collapsed in March 2023 — the second largest bank failure in U.S. history at the time. KPMG had signed off on SVB's financial statements without flagging the bank's extreme vulnerability to rising interest rates, which had rendered its bond portfolio deeply underwater. Congressional investigators and regulators began examining whether KPMG's audit had missed warning signs that should have been visible to a competent auditor. The SVB episode followed the tax shelter scandal and the South Africa state capture debacle to make KPMG's recent history a catalogue of audit failures across three continents and two decades.