In the past, we’ve poked fun at Deloitte’s tendency for boasting. For awhile there, the firm liked to claim that it was more exclusive than Harvard, but then again, so are a lot of things.
One of the firm’s other frequent brags is that it hires lots of people. Only Donald Trump goes on more needlessly about the number of jobs he’s created. We get it, Deloitte. You’re doing well.
Anyway, it’s an annual revenue humblebrag, Deloitte drops its most recent binge:
In FY2017, Deloitte increased its workforce in all geographic regions and businesses, with nearly 70,000 new professionals, an increase of 8 percent from FY2016 – the equivalent of 1 person hired every 8 minutes.
I’m not great with numbers, but something’s not right here. As anyone who’s seen Rent can tell you, there are 525,600 minutes in a (non-leap) year. And yes, if you divide 525,600 by 70,000, you get about 8 minutes.
But where stuff gets weird, is when you look at Deloitte’s numbers for last year. The “increase of 8 percent from FY2016” is in its total headcount, from 244,400 to 263,900. That difference isn’t 70,000; it’s 19,500. So yes, Deloitte hired 70,000, but about 50,000 people also left — the equivalent of one person leaving every 10 minutes. Put in a different light, if one new person is walking in Deloitte’s door every 8 minutes, then one person is walking out two minutes later.
None of this complicated, which is why I don’t understand why Deloitte continues to pretend that we all don’t see what they’re doing. This is accounting, after all; you have to count the ins and the outs. That’s how you measure a year.
In his investigation to ExxonMobil, New York Attorney General Eric Schneiderman has subpoenaed PwC audit workpapers that could reveal climate change’s impact on Exxon’s business. Exxon has been claiming accountant-client privilege, but it hasn’t been working. And, hey, it still isn’t working:
Exxon Mobil Corp.’s attempt to use “accountant-client privilege” to avoid handing over audit documents in a politically charged climate-change probe was dealt a final blow by New York’s top court.
The finding on Tuesday affirms a 2016 ruling that Exxon must comply with a subpoena by New York Attorney General Eric Schneiderman, who is investigating whether investors were misled about the possible impact of climate change on the energy company’s business.
KPMG South Africa
Back in July, we mentioned that KPMG was in a bit of a bind over work it did for a wealthy family, the Guptas, who has the South African president in their pocket. To make matters only slightly worse, the firm’s former CEO Moses Kgosana and some other partners attended a lavish Gupta wedding possibly funded with South African taxpayer money that Kgosana called “an event of the millennium.”
Well, there have been some developments:
Global auditor KPMG cleared out its South African leadership on Friday after damning findings from an internal investigation into work done for the Guptas, businessmen friends of President Jacob Zuma accused of improperly influencing government contracts.
KPMG’s investigation did not identify any evidence of illegal behaviour or corruption but it did find that work done for Gupta family firms “fell considerably short of KPMG’s standards”, the auditor said in a statement.
KPMG SA’s Chairman, CEO, COO and “five senior partners” have all resigned, according to Reuters. The firm also said it would donate the fees it earned (around USD 3 million) from the Guptas to charity.
This scandal has already brought down a PR firm, and speculation is rampant as to whether KPMG could lose its license to practice in South Africa.
Who will be the next PCAOB chair? No one knows for sure, but there’s a name floating around:
William Duhnke, a veteran staff member for former Senate Banking Committee Chairman Richard Shelby, is on track to be selected to become chairman of the Public Company Accounting Oversight Board, according to four people familiar with the matter. An announcement by Securities and Exchange Commission Chairman Jay Clayton could be made in the coming weeks, said one of the people, who like the others asked that they not be named discussing the plan.
Duhnke’s name has been mentioned for awhile as a possible replacement for Doty, although I heard a rumor that this could be a plant to get investor advocates worked up. I guess we’ll know soon enough.
Previously, on Going Concern…
A former PwC auditor settled insider trading charges with the SEC.
In other news:
- If you were on the Tube this morning, hope you’re okay.
- Elizabeth Warren Sets Her Sights on Equifax
- Martin Shkreli’s $2 Million Wu-Tang Album Might Not Be a Wu-Tang Album
- Zero is old.
- Cassini’s final moments: Nasa spacecraft sends last signals on Saturn death plunge
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