January 26, 2020

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EY’s Response to N.Y. Lawmakers’ Letter About Sexual Harassment and Forced Arbitration Is As Bad As You’d Expect

Last week, Adrienne wrote about a letter 67 New York state legislators recently signed and sent to new EY Global Chairman and CEO Carmine Di Sibio denouncing the firm’s practice of forced arbitration agreements, especially in cases of sexual harassment and discrimination. The lawmakers wrote that EY’s forced arbitration policy silences victims of harassment and […]

Oh Look, EY Is On the Receiving End Of Another Sexual Harassment Complaint

After we recently reported on sexual harassment allegations made against male executives at EY U.S. and EY Switzerland by former female employees, Adrienne and I got an email from a woman by the name of Ana Raquel Villanueva who told us that she, too, was a victim of sexual harassment while employed at EY in […]

EY Won’t Waive Arbitration Provision for Ex-Partner Who Says She Was Victim of Sexual Harassment

Last September, we reported on a complaint filed with the Equal Employment Opportunity Commission by former EY partner Karen Ward, who accused her former employer of sexual harassment, gender discrimination, and retaliation. A couple of days after filing the complaint, Ward sent an open letter to EY Global Chairman and CEO Mark Weinberger, asking him […]

EY Switzerland Managing Partner Accused of Sexual Harassment Has Been Relieved of His Duties

The outside investigation into accusations of sexual harassment at EY Switzerland has been completed, and the accused harasser, a male managing partner who also served as the firm’s chief talent officer, has been shown the door. But according to published reports in Switzerland and confirmed to Going Concern by several sources, the law firm engaged […]

EY Switzerland Suspends Chief Talent Officer Accused of Sexual Harassment

The chief talent officer at EY Switzerland was suspended by the firm today pending an independent investigation into sexual harassment allegations made by a former EY female associate, who claims the male executive made inappropriate comments about her breasts, made sexual advances toward her, and then bullied her when she rejected him, according to published […]

KPMG, PwC, and EY Also Kicked U.K. Partners to the Curb for Sexual Harassment, Bullying

We learned on Dec. 9 that Deloitte U.K. had fired about 20 partners in the past four years for inappropriate behavior, including sexual harassment and bullying. The Financial Times, which broke the story, had asked the other Big 4 firms in the U.K. if they would disclose similar information. They declined. But KPMG, PwC, and […]

Another Former EY Partner Has Filed a Sexual Harassment Complaint Against the Firm

[Updated on Sept. 25 with allegations from the complaint, full statement from EY, and full statement from attorney Michael Willemin.] A former female partner at EY filed a complaint with the Equal Employment Opportunity Commission on Sept. 24, accusing the firm of sexual harassment, gender discrimination, and retaliation. This is the second such complaint filed […]

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Accounting News Roundup: EY Settles With Partner Over Sexual Harassment | 05.03.18

Ernst & Young settles sex-harassment suit from partner [NYP] Jessica Casucci has agreed to leave the firm as part of a settlement over the allegations in a complaint filed with the Equal Employment Opportunity Council last month. The Post reports that John Martinkat, the partner at the center of the allegations, has been fired from […]

Team Foreskin and the Spreadsheet Jockey: Sexual Harassment in Public Accounting

At the client site on a Wednesday afternoon, one of the seniors started talking about a coworker. “She’s hot. I told her I wanted to put it in her butt.”

Accountants Behaving Badly: Discrimination at EY U.K., Jail For Cancer Center Embezzler, Client Scammer Gets Prison Time

Plus, ex-accountant for city of Dunbar, WV, gets one year in prison for embezzlement, and former Suzuki accountant faces a seven-year jail sentence for stealing $1.8 million. EY deals partners accused of bullying and discrimination [Financial Times] Current and former staff in the Transaction Advisory Services team at EY U.K. described a culture they claimed […]

Report: Big 4 Firms Are Cesspools For Sexual Harassment, Bullying, and Discrimination

Did you guys read the Financial Times’ article today about the “culture of fear” at the Big 4? If you have a subscription or know a trick around the paywall, you should carve out some time to read it. FT spoke with 20 ex-Big 4 employees who were victims of sexual harassment, bullying, and discrimination […]

Ex-EY Partner Karen Ward ‘Not Surprised’ By ‘Appalling’ Training Seminar for Women

Karen Ward, the former EY partner who alleges she was a victim of sexual harassment, gender discrimination, and retaliation during her tenure with the firm, said she wasn’t shocked to learn about the 1950 2018 training seminar that EY hosted for women leaders, in which attendees were told, among other things, not to flaunt their […]

EY Thinks Women Are a Bunch of Dumb Sluts: Report

Yesterday morning, browsing /r/accounting as I often do before our weekly conference call in which I pull ideas for the week’s content out of my ass, I came across a fresh post about an EY training seminar that supposedly implied women have “pancake brains” and need to be told not to flash the goods in […]

New York Lawmakers Call Out EY’s ‘Culture of Harassment and Discrimination’

It’s rare, especially these days, that bipartisan lawmakers can agree on an issue, but in the case of EY sexual harassment lawsuits they’ve managed to do just that. In a letter to new EY Chairman and CEO Carmine Di Sibio, 67 New York State Legislators, led by Senators Liz Krueger and Alessandra Biaggi, and Assemblymembers […]

Arbitration Costs Mounting For Ex-EY Partner Who Claims She Was Sexually Harassed

A declaratory judgment complaint filed on July 17 is asking a Manhattan federal court to invalidate the arbitration agreement that has prevented former EY partner Karen Ward, who alleges she was a victim of sexual harassment and pay discrimination, from taking the firm to court. According to the complaint, to have Ward’s sexual harassment claims […]

Exclusive: We Know What Mark Weinberger Will Be Doing That He’s Officially Out at EY

No one was as surprised as we were when the news broke late last year that Mark Weinberger was stepping down as global chairman and CEO of EY. Adding to the mystique of his unexpected departure, our source — who helped us break the story — hinted that Weinberger’s exit was prompted in part by […]

Marcel Stalder Is Out as CEO of EY Switzerland

A couple weeks ago, we got an email from a tipster who told us that EY Switzerland CEO Marcel Stalder was “dead meat” due to the firm’s handling of sexual harassment allegations made against a male managing partner by a former female associate. Well, turns out this person was right; Stalder has stepped down as […]

Here Is More Proof That EY Switzerland Is a Total Frat House

Well, guys, we learned today that at an EY Switzerland holiday party a few years ago, Santa Claus got an erotic lap dance on stage in front of about 200 people. And the man dressed like jolly ol’ Saint Nick is a partner in the firm’s banking practice, and the woman grinding on his lap […]

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Mark Weinberger Is Done Being EY Global Chairman and CEO

Last night we were tipped off about a major announcement happening at EY this week, and we have received official confirmation of said announcement today by the firm: Mark Weinberger is stepping down as global chairman and CEO effective June 30, 2019. EY confirmed what our source told us, that Weinberger told the firm’s leadership […]

Female KPMG Employees Seek Class Status in Gender Discrimination Lawsuit, Detail Alleged Sexual Misconduct at the Firm

There was a new development yesterday in the long-running gender bias lawsuit against KPMG, in which a group of current and former female advisory and tax professionals have accused the firm of gender, pay, and promotion discrimination, as well as condoning sexual harassment. Attorneys representing the plaintiffs filed a motion on Nov. 27 that asked […]

Former EY Consultant Indicted on Hate Crime Charges for Allegedly Attacking Gay Couple, Being a Total D-Bag

Brandon McNamara, a 25-year-old former EY employee who was arrested in September for allegedly beating up two gay men outside a Brooklyn bar, faces up to 15 years in the slammer after he was indicted on hate crime charges last week. Brooklyn District Attorney Eric Gonzalez said McNamara was arraigned on Nov. 14 and charged with […]

‘Drunk A-hole’ EY Senior Consultant Arrested By NYPD For Allegedly Beating Up Gay Couple

It has not been a good week for fellas with the last name of McNamara who work or who have worked at EY. Brandon McNamara, 25, who reportedly is a senior consultant with EY, was arrested by the New York Police Department on Sept. 26 and faces a slew of charges for the alleged beating […]

Ex-EY Partner to CEO Mark Weinberger: ‘Let’s Make EY a Better Place to Work for Women’

In a Sept. 26 letter to EY Global Chairman and CEO Mark Weinberger, former partner Karen Ward, who filed a sexual harassment, gender discrimination, and retaliation complaint against the firm earlier this week, invited the firm’s leadership and board of directors to meet with her to “discuss my experiences at EY and additional ways in […]

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Deloitte ‘Betrayed Me,’ Alleged Sexual Assault Victim Told CEO in Email

A former Deloitte Bermuda staffer who has accused a senior partner in the Big 4 firm’s New York office of sexual assault emailed Deloitte LLP CEO Cathy Engelbert in 2017 about the alleged attack and said the firm “betrayed me,” according to a July 9 NBC News report. The senior partner has not been charged […]

Report: Ex-Deloitte Bermuda Staffer Accuses U.S. Partner of Sexual Assault

The Australian Financial Review reported on July 3 that a woman who used to work in Deloitte’s Bermuda office has accused a male senior partner from the Big 4 firm’s New York office of sexual assault in a Bermuda hotel room in August 2015. The woman, who did not want to be identified in the […]

ernst & young report ashley madison

If EY Treats a Partner Who Reports Sexual Misconduct Like This, What Hope Do Other Employees Have?

Update in the 18th paragraph includes an additional statement from Ernst & Young. One of the more shocking details from the sexual harassment complaint against Ernst & Young is that even though the victim, Jessica Casucci, was a partner, other partners and senior officials in the firm either did nothing or took action to protect […]

kpmg general electric

Accounting News Roundup: Tax Reform Glitches; KPMG and GE; Sexual Harassment | 03.13.18

G.O.P. Rushed to Pass Tax Overhaul. Now It May Need to Be Altered. [NYT] There are a number of quirks in the new tax law “that disadvantage certain farmers, hurt restaurateurs and retailers and could balloon the tax bills of large multinational corporations,” and that has business owners and executives worked up. Meanwhile, many fixes […]

Accounting News Roundup: Shorter Auditor Tenure and Misconduct Allegations at KPMG, EY Down Under | 02.28.18

Study supports shorter auditor tenure [AT] A study by Zvi Singer of HEC Montreal and Jing Zhang of the University of Alabama in Huntsville found that “Auditors with shorter tenures were faster at discovering financial misreporting.” New accounting rules trim Tesla deficit and promise faster future revenues [MW] Francine McKenna reports that Tesla cut its […]

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Accounting News Roundup: Sarbanes-Oxley and Tax Reform Sans Trump | 09.11.17

Mike Pence is hoping he gets to sit down soon.  Sarbanes-Oxley Back in July, we noted a hearing on Sarbanes-Oxley where a slew of witnesses, including New York Stock Exchange President Tom Farley, spoke about its “great cost on corporate America” and that its “benefits are not entirely clear.” The requirement that companies comply with […]

Deloitte Seeks to Dismiss Headhunter’s Claims of Sexual Harassment and Employment Discrimination

Last month, we told you about a lawsuit filed in New York by the ex wife of Mets great Art Shamsky. Kim Valentini-Shamsky is a recruiter (headhunter in the lawsuit) who alleges a laundry list of misdeeds by Deloitte, all brought on because she wouldn't bang the Deloitte guy she was sending candidates to. Deloitte's […]

Ex-Wife of Art Shamsky Back in Court to Sue Deloitte for Sexual Harassment

A lawsuit was quietly filed in New York on Tuesday, naming Deloitte and Big D Talent Director Louis Bastone as defendants. The charge? Sexual harassment. Well, sexual harassment and severe work-related cockblocking.

PwC Would Appreciate It If Staff Would Stop Getting Drunk In the Office, Thx

In a former office of mine that shall remain nameless, we had a liquor cabinet. Working long hours, it wasn’t unheard of for my colleague and me to pour ourselves a drink at 5 on the dot, sipping vodka Red Bull as we tied up the day’s tasks. The arrangement worked well as we got […]

Guess Which Big 4 Firm Houston Astros Executive and Taunter of Female Reporters Brandon Taubman Used to Work At?

Houston Astros executive Brandon Taubman has made headlines in the past 24 hours for allegedly coming off as a jag in front of several female sports reporters. Deadspin wrote: During the Houston Astros’ clubhouse ALCS victory celebration Saturday night, Astros assistant general manager for player evaluation Brandon Taubman taunted three female reporters about the organization’s […]

Friday Footnotes: Me Too Too; CPA Cred Boosted; Why the F*ck Do Partners Get Paid Bank Despite Failings | 9.20.19

AICPA’s new forensic standard expected to boost CPA credibility on witness stand [Accounting Today] The American Institute of CPAs has a new forensic accounting standard due to take effect at the beginning of next year, and it promises to give CPAs a leg up in terms of their credibility in providing litigation support as expert […]

Friday Footnotes: Cocaine and Hookers; Facebook Slapped By the SEC; PwC on AI | 7.26.19

Geeky accountant who stole £150,000 and blew it on cocaine and hookers told to pay back just £1 [The Sun] Carvill, 38, was jailed for 2½ years after admitting fraud. His sentencing hearing was told he’d been bullied for most of his life and suffers very low self-esteem. Accountants ordered to disclose information on personal […]

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Two KPMG U.K. Female Partners Had Enough Of Working At a Firm That Protected An Alleged Bully

Last December we learned that the Big 4 firms across the pond sacked nearly 40 partners (probably all men, although we don’t know for sure) within the past four years for inappropriate conduct, such as sexual harassment and bullying, seven of whom had worked at KPMG. But KPMG evidently sided with a male partner who […]

Vault 2020 Firm Rankings: Culture, Leadership, Relationships with Supervisors, and Work/Life Balance

Hey, guys. Hope you all had a nice, relaxing holiday weekend. As you know, Mondays after a holiday weekend suck, especially if you hate your job. But there are accounting professionals out there who were probably champing at the bit to come to work today because they actually enjoy being there and being around their […]

Zoltar

What Will Be the Greatest Issue to Impact the Accounting Profession in 2019?

Around this time of year, we all inevitably start thinking about the year behind and the year ahead. Maybe we swear to do better come January, maybe we say fuck it and don’t change a thing. Whatever your approach to the stroke of midnight, it’s tempting to think about what issues might affect the profession in […]

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Deloitte U.K. Fired 20 Partners for Being Scumbags

Over the past four years, Deloitte U.K. has gotten rid of about 20 partners for inappropriate behavior, including sexual harassment and bullying, the firm’s CEO, David Sproul, told the Financial Times in an article published on Dec. 9. “We will fire people for any inappropriate behaviour. No one is protected,” said David Sproul. “There has […]

Federal Judge Sides with KPMG in Gender Discrimination Lawsuit

KPMG scored a huge victory in court on Nov. 30, as a New York federal court judge declined to certify a long-running class-action lawsuit by thousands of current and former female KPMG tax and advisory professionals who accused the firm of gender, pay, and promotion discrimination dating back to 2008. While the ruling bars the […]

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Accounting News Roundup: New York vs. TCJA, a Bad Q4 Looms, a ‘Misunderstood’ Generation | 01.04.18

Striking fear into the hearts of Oregonians. New York reviewing tax system changes after new federal tax bill [Reuters] Governor Andrew Cuomo plans to sue the federal government because the Tax Cuts and Jobs Act is “unconstitutional on the grounds that the first federal double taxation in U.S. history violates states’ rights and equal protection.” […]

accounting news tax bill

Accounting News Roundup: Treasury’s One-Page Wonder; Unhelpful H.R.; ‘Sheer Curiosity’ | 12.12.17

Trump administration explains details of how tax plan would pay for itself, immediately gets attacked for assumptions [WaPo] No one is buying the conclusions of a one-page memo that expects the tax plan to generate a full percentage point more of economic growth than the Congressional Budget Office estimated. “One percentage point of higher growth […]

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Accounting News Roundup: The Talent War, Tax Havens, and 20/20 Visions | 11.07.17

The Talent War I’ve noticed that there’s something hostile about how people describe the search for qualified finance and accounting professionals. Statements like, “IT’S A WAR FOR TALENT” or “THE BATTLE FOR THE TALENT IS ON” are so pervasive, I’ve been assuming for awhile now that human resource departments line up every Monday to calls […]

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Accounting News Roundup: Air Force Jet Requests, Hair Solicitation, and Essence | 09.14.17

Plus, Deloitte made some money last year. Work perks (?) Ladies and gentlemen, I give you the guy in charge of tax reform: Secretary Steven Mnuchin requested use of a government jet to take him and his wife on their honeymoon in Scotland, France and Italy earlier this summer, sparking an “inquiry” by the Treasury […]

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Accounting News Roundup: SoFi, Competitive Poaching, and Accounting Firms Can Do Anything | 09.12.17

Just slowly dying over here. SoFi Late on Sunday, The Wall Street Journal reported that fintech unicorn SoFi had been dealing with a workplace culture issues, specifically, allowing an environment that is openly hostile and sexually improper towards women. This included the former CFO, Nino Fanlo, who: would commonly make comments about the physical appearance […]

accounting news taxes trump career paths

Accounting News Roundup: Taxes, *Very* Different Career Paths, and Lewd Behavior | 08.11.17

Taxes Consummate bullshit artist and current POTUS Donald J. Trump repeated one of his favorite falsehoods yesterday, saying, “We pay more tax than anybody in the world.” Although this has been discredited by countless economists and tax experts, they made the rounds again including this exasperated guy from the Tax Foundation: “Two years later, and […]

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The AICPA Is Trying to Innovate You Right Out of a Job

As we are all painfully aware, the accounting industry isn’t exactly known for its groundbreaking commitment to early adoption and innovation. Despite its over 150-year history of being reactive and clinging desperately to the way things have always been, the AICPA announced this week a new initiative that hopes to fund important accounting startups. The […]

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Accounting News Roundup: Construction, Uber, and Ronaldo | 06.14.17

Talent crisis? This is a talent crisis. Next time someone goes on about the shortage of talent in accounting, kindly remind them that things could be worse, like in construction. Similar to accounting, construction can’t hire young workers to replace its retiring experienced workers fast enough. But the double whammy for construction companies is that […]

Exposure Drafts - Diversity - accounting

Accounting News Roundup: Diversity in Accounting Could Be Worse; ‘This doesn’t pass the smell test’ | 05.01.17

Diversity in accounting: It could be worse! Accounting firms pay a lot of lip service to diversity. The Big 4, especially, like to point out the number of women and minorities they hire, and the statistics do bear it out. However, at the partnership level, the profile is still largely white and male. Still, accounting […]

How Would Donald Trump and Hillary Clinton Fit Into Public Accounting? A Brief Analysis

I don't imagine that too many people have given much thought to how Donald Trump or Hillary Clinton would fit into the accounting profession, but Peter Reilly did and I'm grateful:  The only two roles I could see for Trump in public accounting are client from hell or managing partner. Public accounting firms at the […]

Diversity? Ugh.

Whenever Caleb assigns me a diversity article, my first thought is always “Diversity? Ugh.” I'm not alone in this. Movie director Ava DuVernay recently said that the word diversity “feels like medicine. 'Diversity' is like, 'Ugh, I have to do diversity.' I recognize and celebrate what it is, but that word, to me, is a disconnect.' […]

Friday Footnotes: Gay Marriage Wins; How Uber Conquers; Rand Paul vs. IRS | 06.26.15

Have a great weekend, double-entry mavens. Drop us stories and tips by hitting the button at the top of the page or emailing us directly. Follow us on Facebook, Twitter, Pinterest and write your accounting opus in Open Items. Supreme Court Rules in Favor of Same-Sex Marriage [AT] Sexism & Public Accounting [r/accounting, Earlier] Deloitte […]

Treat Vacation Like Avocados

ICYMI, I was away last week and in my absence the accounting world did not, I repeat — DID NOT — tilt off its axis.  During my week of leisure, we had three excellent pieces from contributors on dead social security numbers, MBAs, and sexual harassment. Those managed to whet your appetites enough so I […]

KPMG Concerned Employees Can’t Resist Banging One Another

According to a tipster, KPMG distributed this the other day, because apparently sleeping with your coworkers is a serious problem over there.

Making the transition: Part 1 – Failure to Launch

Ed. note: it appears this bold soul is the first to audition to be Going Concern's next big thing. Let's be gentle. “What are your three strengths and three weaknesses?” asked the interviewing partner from Deloitte. I will always remember this question as my biggest interviewing bobble to date. Who the fuck asks for three?! […]

Going Concern Presents: Public Accounting Horoscopes

Wondering what the stars have in store for you today? Wonder no more, GC faithful!

Footnotes: Is That an Eagle or Something?; SEC and Trading; The Fine Art of Sexting Coworkers | 02.27.14

Some restaurants got the bright idea to add an "Obamacare surcharge" to orders [CNNMoney] The SEC Should Really Start a Hedge Fund I guess a bigger question, though, is why are so many SEC employees trading stocks in the first place? The authors' sample, which runs from August 2009 through December 2011, consists of 29,081 […]

Share Your Tips For Getting Through Your Miserable Work Life!

EYStaff started it: I always try to remember to smile when on the phone. It helps make your voice & tone sound more receptive -Lys #EYQuickTip #WhatIveLearned — Life at EY (@EYstaff) January 2, 2014 Any fellow @EYstaff want to share some tips?! Comment below! #knowledge -Lys — Life at EY (@EYstaff) January 2, 2014 […]

This Year, Resolve to Finally Decide What You Want To Be When You Grow Up in Public Accounting

As best I can tell, GC brought me on board for five reasons:   Sex appeal. Sex appeal. Sex appeal. Tax knowledge. Partner experience. The first four are self-explanatory. As for the last one, Caleb and Adrienne seem to think that I might have words of wisdom to share with the unwashed masses because I’ve […]

Footnotes: Spreadsheet Addicts; Accounting is Totes Hawt; Where’s the Passion? | 09.24.13

Tim Ryan has an opinion on why accounting is still an attractive profession and you won't need to attend sexual harassment training afterward [Accounting Today] Patrick & Robinson CPAs – a firm out of Florida – is holding a contest in celebration of the 100th anniversary of the income tax. The gist of it is […]

Accounting News Roundup: Obama to Make New Offer on Corporate Taxes; Barnes & Noble’s Messy Books; Herbalife Still Feeling London Effects | 07.30.13

Obama to Offer New Deal on Corporate Taxes, Jobs [WSJ]Hoping to break an impasse, President Barack Obama today will extend a new offer to congressional Republicans in which he would back an overhaul of the corporate tax system in exchange for a guarantee that a resulting one-time windfall be used to underwrite various job creation […]

Accounting News Roundup: DOMA Decision Could End Grossing Up; IRS Loses Another Appeal; Bigger Is Better in Iowa | 03.28.13

DOMA's Elimination Could Benefit Ernst & Young, Google, Facebook By Ending 'Grossing Up' [HP]After her partner gave birth to triplets in 1998, Chris Crespo began paying closer attention to the employee benefits offered by her company, major accounting firm Ernst & Young. "I wanted to make sure that there was coverage for my children," said Crespo, […]

KPMG Is Spreading the Love With This Kuddling Kampaign

Thank you to the understandably skeptical individual who provided the following via the tip box: I received this informative health postcard in my work mailbox this morning.  No word yet on whether they will provide a cuddle partner for me.  HR must be looking for job security as I'm pretty sure cuddling in the audit […]

It’s Time To Retire the Useless Jargon

A reader sick of the clichés suggests we open the floor to discuss some overused phrases that should be retired immediately. Let's think outside of the box here, circle back and think big picture. The use of the phrase "reaching out" should be immediately discontinued! It's old jargon that people are totally sick of hearing. […]

New Accounting Club President Needs Help Trolling Peers, Firms

Need help working on your office etiquette or lack thereof? Trying to figure out how to hit on your colleague without getting dragged off to 12 weeks of sexual harassment training? We've got your back, just get in touch. I've just been elected Accounting Club President! Any suggestions on how to best troll my peers […]

Accounting News Roundup | 12.30.11

Ed. note: This is the last roundup of 2011, capital market servants. Thanks for a great year! We're taking Monday off back to a full slate on Tuesday. Have a safe New Year's and try not to do something stupid, like getting arrested or vomiting on your date's shoes. Of course if that does happen, […]

Accounting News Roundup: U.S. Companies Aren’t Ready for IFRS; Limited Liability Is a Godsend; Out with the Old GM CFO | 03.10.11

IFRS Outlook: Hurry Up and Wait [CFO]
Asked which are the most crucial accounting issues that their companies are facing in 2011, 34% of the 472 CFOs who responded to the question ranked “Convergence to IFRS,” or international financial reporting standards, as number one. Cumulatively, the respondents ranked IFRS convergence higher than any other accounting issue. Yet asked to describe their companies’ “readiness to comply with global accounting standards,” 44.2% said they hadn’t “begun to address convergence,” while 38.8% said they were preparing, “but far from ready.”

Satyam Seeks SEC Approval To Shorten Period of Earnings Restatement [Dow Jones]
Satyam Computer Services Ltd. […] which is recovering from a fraud scandal, is in talks with the U.S. Securities and Exchange Commission to shorten the time frame for which the company would need to restate its earnings under U.S. accounting standards, its chairman said. A restatement of earnings under U.S. accounting standards would be one of the prerequisites for Satyam to be able to relist on the New York Stock Exchange.

Auditors would deflate accounting bubbles [FT]
But it is right for regulators to impose high standards on auditors, who in servicing big quoted companies benefit from what looks suspiciously like an oligopoly. Accountants who habitually let a little air out of inflated asset values could help avert future market crashes. In an old joke, a chief executive asks his slick FD what the profits figure is. “What would you like it to be?” comes the reply. Sceptical auditors would guard against that.

Auditors Abandon Investors On Liability Limits [Forbes]
The Big 4 audit firms have always been preoccupied with significant legal liability in the US. Managing these cases requires exorbitant amounts of the US firms’ time and money. Their international umbrella firms and, in many cases, members firms in other parts of the world are also burdened. It’s my estimate that Big 4 leadership spends 75% of their time on litigation matters.


American Apparel CEO held teen as sex slave: lawsuit [Reuters]
American Apparel Inc founder and chief executive Dov Charney is being sued for $250 million by a woman who said he treated her as a sex slave when she was a teenage sales employee at the clothing chain. Irene Morales of Brooklyn, New York, has accused Charney, 42, of sexual harassment, creating a hostile workplace, gender discrimination and retaliation. American Apparel and directors at the company have also been named as defendants in the lawsuit, filed in a New York state court on Friday. Morales accused them of failing to protect her, and said they knew or should have known that Charney was a “sexual predator.”

Marijuana IPOs Provide Investors With Gateway to Cannabis Boom [Bloomberg]
The legalization of medical marijuana — permitted in at least 15 states — has kicked off a booming economy in ancillary goods. Startups such as Peterson’s GrowOp Technology Ltd. and General Cannabis Inc. (CANA) compare the phenomenon to the California gold rush, when the people making the real money were the ones selling pick axes and shovels. Both companies are planning initial public offerings, part of an effort to remove the stigma from what’s seen as a multibillion-dollar industry.

GM Announces CFO Transition [PR Newswire]
General Motors Vice Chairman and Chief Financial Officer Chris Liddell today announced that he will leave the company April 1, 2011, having completed the largest public offering in history and stabilizing the company’s financial operations. Liddell, 52, joined GM in January, 2010 and led the company’s financial and accounting operations on a global basis. “Chris was a major contributor during a pivotal time in the company’s history,” said Dan Akerson, GM chairman and CEO. “He guided the company’s IPO process and established a good financial foundation for the future.”

What Can a New Big 4 Associate Expect Their First Week?

Welcome to the Holiday Hump Day edition of Accounting Career Emergencies. In today’s edition, a future tax associate wants to know how to prepare for the first few weeks on the job. Can we help this newbie avoid a nervous breakdown?

Need career advice? Looking for busy season survival tips? Curiosity around the dirt of our country’s diplomatic relations getting the best of you? Email us at advice@goingconcern.com and we’ll make sure you don’t end up in a room with no windows.

Back to our nervous Nellie:

Hey guys,

I apologize if this is a duplicate of a prior question; but I’ve scoured the forums and can’t seem to find an answer.

I am starting at a Big 4 firm in January as an associate in the Federal tax practice. I have a few weeks at my local office before leaving for national training.

Could anyone give me an idea of what to expect from the first few weeks? Like most new associates, I feel like HR’s oversight. I really want to give myself the best possible chance to not look like a complete idiot. What can I do to prepare for my first few weeks at work? What am I expected to know or not know going in?

Constructive comments (I’ve heard all the “get ready to have no life”, “you are a slave” comments already) would be much appreciated.

Thanks,
Booker T. Nervousman

Dear Booker T.,

Constructive comments? Where do you think you are? If you want real help, call Dr. Phil (the real Dr. Phil, not his Deloitte doppelgänger).

Kidding aside – it’s pretty difficult for us to predict what your first couple of weeks as a newbie will be like (our personal experience was as an experienced hire) but we’ll give it a shot. You’re likely to get a whole lot of mindless training thrown at you – diversity, sexual harassment, the ushe. This will be useful when you’re sitting around with nothing to do, while a SA or manager tries to drum up some work for you. Like everyone, you’ll get the office tour but since you’re in tax, you’ll want to pay close attention because you are going to spend all your time at the office; our guess is that you’ll have a cubicle waiting for you.

Things to keep an eye out for – a) bathrooms with lighter foot traffic; b) hotties (regardless of proximity to where you sit); c) easily accessible stairs so you can avoid awkward elevator encounters; d) break rooms with real coffee (not that Flavia garbage).

You’re likely to get some work in your first couple weeks leading up to your national training but it’s not like you have to memorize Bittker & Eustice before starting work. Chances are your seniors will assume you don’t know jack and in some respects they’re right. Hopefully, they’ll walk you through exactly what they need from you but remind them that you do have training coming up so you don’t have work sitting on your desk for the better part of a week. Keep in mind that if you had an internship with the firm and will be working with a lot of the same people, they may have higher expectations for you than if you end up on a brand new team.

Ultimately, your first-ish week(s) will be hectic but you’ll be fine. Make like an eager beaver but not too eager. Oh, and look sharp. Nothing worse than sloppily dressed newbie.

Surely we’re missing some things here, some chime with appropriate insight, keeping in mind that Booker T is already aware that their life is about to come to end.

Memo to the AICPA: You Don’t Have To Be In High School To Come Up With Juvenile Acronyms

Some of you seemed less than enthused when we shared an AccountingWEB piece on the AICPA’s new “Clearly Pretty Awesome” campaign two weeks ago so I’m here to get a good hoo-RAH out of you in the hopes that you, our brilliant, bitter and oftentimes inappropriate Going Concern readers, might have 2 or 3 cents to add.


Here’s the deal, the AICPA is giving away cash and prizes (to be used strictly for educational purposes, that is) for whomever (between ages 15 – 19) can come up with the best made-up job title using those all important three letters: C P A. Since the efforts of both the Obama administration and Ben Bernanke seem to be useless in creating jobs, perhaps high schoolers can boast a better success rate in creating new jobs. Sorry, Certified Public Asshole is already taken and frankly, kind of played out. But that doesn’t mean you can’t have similar ideas for made-up jobs, though whether or not anyone actually becomes a Chief Private Asshat remains to be seen.

The obvious inspiration behind the campaign is to plant the seed of public accounting in young little future beancounters’ brains when they are still pliable and easily influenced. After all, it’s easier to get them now, as opposed to later on down the road when they’re bitter and pissed off, overworked and saddled with a family and a career. While we admire the AICPA’s efforts in painting the profession in as cool a light as possible given the circumstances, we don’t quite see the point in rewarding whomever makes up “city park accordionist”.

Instead, here’s what I propose: take your high school student to work day for CPAs. Cops do it, why can’t we? Invite high school students to go on a ride-along to the client and hell, while they’re there why not have them partake in such exciting awesomeness as inventory counts? It will look great on their résumés when the job market looks up in 3 – 7 years!

Or better, encourage students to become forensic accountants by taking them to a real prison to follow a day in the life of Jeff Skilling complete with orange uniform and over-aggressive cellmate. That kills two birds with one stone as the impressionable youngsters could also get a great lesson in sexual harassment from a tattooed dude named Spike and save themselves an employee training or two down the road. Perfect!

So, go on then, what do you think CPA could stand for?

American Apparel Subpoenaed Over Auditor Switcheroo

American Apparel’s downward spiral continues as Bloomberg reports that the company has been subpoenaed by the U.S. Attorney for the SDNY over the company’s “change in accounting firms.”

If you’re justl started with Deloitte quitting as the auditors of APP late last month. At that time, Deloitte warned that the ’09 financial statements may not (read: definitely are not) reliable and that they were getting the hell out of Dov.

Former APP auditor Marcum – for reasons unbeknownst to us – went back to their old client to try and help them straighten things out. Here’s the latest from the “preliminary results” for the second quarter, while thetardy 10-Q remains elusive. These prelims (i.e. a wild stab?), that were filed today warn that things are likely to get worse before they get better:

Potential Restatement of previously issued financial statements

Effective July 22, 2010, Deloitte resigned as our independent registered public accounting firm. On July 26, 2010, we engaged Marcum as our independent registered public accounting firm. On July 28, 2010, we reported on a Form 8-K that we had been advised by Deloitte that certain information had come to Deloitte’s attention that if further investigated may materially impact the reliability of either Deloitte’s previously issued audit report or the underlying consolidated financial statements as of and for the year ended December 31, 2009 included in our Annual Report on Form 10-K for the year ended December 31, 2009. Deloitte has requested that we provide Deloitte with the additional information Deloitte believes it is necessary to review before any conclusions can be reached as to the reliability of the previously issued consolidated financial statements as of and for the year ended December 31, 2009 and auditors’ report thereon.

Depending on the outcome of this review, a restatement of our financial statements as of and for the year ended December 31, 2009 could be required. Any restatement may subject us to significant costs in the form of accounting, legal fees and similar professional fees, in addition to the substantial diversion of time and attention of our Chief Financial Officer, our other officers and directors and members of our accounting department in preparing and reviewing the restatement. Any such restatement could adversely affect our business, our ability to access the capital markets or the market price of our common stock. We might also face litigation, and there can be no assurance that any such litigation, either against us specifically or as part of a class, would not materially adversely affect our business, financial condition or the market price of our common stock.

But that’s not all! The company discusses a few more issues, “We are subject to regulatory inquiries, investigations, claims and suits. We are currently defending one wage and hour suit, one sexual harassment suit and responding to several allegations of discrimination and/or harassment that have been filed with the Equal Employment Opportunity Commission or state counterpart agencies.”

At that point, the filing finally gets to the problem du jour:

In addition, in connection with our previously disclosed change in auditors, on July 30, 2010, we received a grand jury subpoena from the United States Attorney’s Office for the Southern District of New York for the production of documents relating to the circumstances surrounding the change in our auditors. We have also received inquiries from the Securities and Exchange Commission regarding this matter. We intend to cooperate fully with these requests and any related inquiries.

If consider all that, plus the fact that the company is spending cash like Pacman Jones at a strip club and that they’re likely to be in noncompliance with a major debt covenants at September 30th, it’s no surprise that the stock is off even more than when Deloitte first quit as auditors.

American Apparel Drops After Receiving Subpoena on Change in Accountants [Bloomberg]
10-Q [SEC]

(UPDATE) Apparently You Can Also Be Too Hot to Work at PwC

~ Update includes statement from PricewaterhouseCoopers spokesman

By now you’ve probably heard about Debrahlee Lorenzana, who was claiming that being an über-hottie caused her to get fired from her job at Citi.

The Big 4, having its share of hotties, now is facing allegations of its own discriminatory behavior. We were sent the following email that has been making the rounds at PwC about a young associate who was shown the door last Friday. Bravely, the author of the email included her name and phone number, which we’ve redacted:

I have been following the story about the banker in NYC who was fired for her “appearance”. I was just fired today [June 11th] froerhouseCoopers. I am a graduate of Lehigh University, I have been with the firm since September 2009. I would like to think I am competent enough to hold a job – I recently studied 8 hours for a CPA exam and passed. A test that I have watched my peers struggle with – studying for months and failing multiple times. I have 3 of 4 CPA exams completed, and I am 3-3 in my testing.

Anyway, I was placed on an engagement with an all-male team and one female partner. I was given a poor review on this engagement, however, my work received glowing reviews. On all my other teams I have gotten feedback that I am a pleasure to work with, intelligent, hard-working etc.etc. Per my performance review, they noted that the reason I performed below expectation was because I had a negative attitude with my team and the other piece of feedback I received, from this female partner, is that I was dressed inappropriately because I didn’t wear tights with my skirts in the winter. This is during a time we lived out of a hotel, working from 9am-4am, 7 days a week, and the last thing on anyone’s mind is clothes. I am a 22 year old girl, and I definitely do not “look the part” of an accountant. While on my team with all males, I received constant harassment about how I should “sleep with the senior manager (who was very disliked) to make him cooler” or “you have to go talk to the client cause you are hot”. My mentor from the firm was on my team as well, and every day would comment on my appearance, such as, “Did you lose weight? You look good” or “Your legs look fabulous today”. I was also told that my senior on the team was “in-love with me” and that I should “hook-up with him”. During this period I had a boyfriend whom I expressed my deep deep frustration on this with. Since my employment at the firm, I have been constantly harassed by the partner who hired me. I received such e-mails as, “I am home alone in my hot tub, you should come” or text messages like “So what color underwear are you wearing?” which, I kept my mouth shut about. Keep in mind this individual is married, with kids. Eventually I went to HR when I received my performance review because obviously there was a major disconnect. Of course, they “fully investigated” with the team of all males, and today I was told that I was fired, for under-performance. I was denied a copy of my performance reviews (which as our review policy goes – are given back to each individual at the firm). I inquired as to whether HR had spoken to other individuals I had worked with, and they told me “it was irrelevant” and that my review was contingent only upon “this one engagement (as referred to above)”. Bear in mind that I have worked on 5 other clients since September 2009, and these reviews were thrown to the wayside.

I have been following the story in the news about the woman banker fired in NYC, and have received multiple comments from my co-workers such as, “I can see them doing this to you” or “this is probably why the female partner doesn’t like you – cause you are hot”. Obviously, there seems to be an underlying theme here.

I graduated with a 3.4 from Lehigh, majoring in Accounting and minoring in writing. I got a 1410 on my SAT’s, a near perfect split of 710 Verbal and 700 Math. Throughout my life, the one thing I was sure of was my ability to compete intelligence-wise with my peers, and often exceed far above. So you can understand my extreme confusion and frustration that I could be capable of under-performing, at a firm, where there is documented proof on paper I perform well above my peer group.

So I come to you, whomever may be concerned, as this is an issue I am bringing to light and will hire an attorney for. I was wrongfully terminated – without a fair reason. I have saved all of my work performed while at PwC to provide as evidence of comparison with my peers. If this type of story strikes interest with anyone over at the NYT, I am more than happy to share more information. Like they say, Big Fours are “slave-drivers”, and yet again, they perpetuate this image.

I can be reached by telephone at [redacted]. I live in Stamford, CT and worked on clients from NYC to NJ to CT. Thank you for taking the time to read this – I am a bit flustered still from today’s events, but find no better way to vent than by writing.

SO! That’s a lot to digest. Being a fan of fantastic gams (who isn’t, amiright?) is one thing but verbalizing it in the middle of internal controls testwork is entirely another. That being said, a text requesting the hue of undies is whole other level of awkward.

Our calls, emails, telegrams, and messages by carrier pigeon to PwC have not been returned.

UDPATE: PwC spokesman Jon Stoner provided us with the following statement:

As a matter of policy and practice, PricewaterhouseCoopers is fully committed to maintaining a workplace free of sexual harassment. We take any complaints about sexual harassment seriously, and investigate any such claim thoroughly and confidentially. That is exactly what we did in this case, and we did not find any basis to the allegations.

Firm Watch: PwC

pwclogo.thumbnail.jpgThis week we’re putting together a series of posts on the six largest accounting firms to give you an idea what their latest image seems to be based on the latest news and rumors we’ve read or heard about them. At the end of the week we’ll wrap up with a completely unscientific and probably unfair ranking which you will be allowed expected to take exception with.
We’ll start with P. Dubs because they seem to have had the uncanny ability to attract bad news lately:
Get the gory details, after the jump


Satyam Fraud in India – $1b fraud, two auditors rotting in jail, Satyam throwing the Firm under the bus every chance it gets. This is the story that will definitely not go away.
Discrimination Suit in London – GBP 40 million lawsuit, including alleged sexual harassment. P. Dubs is saying the lawsuit is “without merit” but at the very least there are a number of bigots working there.
• Rumors of PwC interns working 60 hour weeks in the New York office. Might as well give them an idea of what they’re in for, right?
• Chosen to take a suicide mission contract in Somalia to monitor the incoming aid
Wage and hour lawsuits in California – Listed as defendant in three cases
Huron Consulting Restatement – P. Dubs isn’t mentioned in this debacle. YET.
Madoff exposure – listed as a defendant in over a dozen lawsuits.
As for layoffs, we haven’t heard much lately. There was a rumor that the PwC Denver office had let some associates go in the past few weeks but we don’t have any more details than that. Layoffs that have occurred in the past year at PwC we’re rumored to be of the stealth variety and not related to the recession which nobody really believes.
So, that does it for P. Dubya for now. What are we missing? Whatever office you work out of, send us the latest scoop on layoffs, performance reviews, promotions, pay raises, bonuses, juicy gossip, scandalous stories, etc. to tips@goingconcern.com and we’ll update the posts appropriately throughout the week.