June 19, 2018

Are the Big 4 Desperate for Audit Work?

In the latest predatory tactic from our friends at the Big 87654, we see that the recession may not be treating them so badly. Sure, non-profit busywork isn’t exactly a good time to be had by all but it pays the bills and for the Big 4, there is no such thing as bottom of the barrel.

Take what you can get, right?


Crain’s:

The financial crisis blew up many big-name clients, leaving audit firms with excess capacity. Bear Stearns Cos., Merrill Lynch & Co., Washington Mutual Inc. and Fannie Mae disappeared from Deloitte LLP. Ernst & Young saw Lehman Bros. Holdings Inc. implode, while KPMG lost Countrywide Financial Corp. and PricewaterhouseCoopers lost Freddie Mac.

Gary Boomer, a Kansas-based accounting industry consultant, says Big Four firms sometimes are bidding less than $100 an hour for non-profit and public-sector work, down from $175 to $250 for junior auditors. “What they’re doing is buying some work to keep the staff busy,” he says.

That’s hilarious, shouldn’t we stop and think about why they allowed “the financial crisis” (you mean the unstable positions of those financial firms lost in the bloody battle?) to blow up so many of their big-name clients before we let them scavenge the scrapings for a tasty morsel of audit work?

I guess it works, it’s not like you’ve got guys in the cathedral on December 31st counting saint candles.

It could be worse. Here are some really nasty audits that the Big 4 could be doing in lieu of cheap non-profit and public sector work:

Joe Stack – Think about it, KPMG, you have some awfully tall buildings, be grateful.

Blackwater expenses – They really deserve their own audit team. It’ll keep those juniors busy, ifyaknowwhatImean.

C Street – Bonus side work helping Mark Sanford convert his dollars into Argentine pesos.

Whore yourselves out however you have to, guys, even if it means a door-to-door campaign for whatever audit work you can find.

In the latest predatory tactic from our friends at the Big 87654, we see that the recession may not be treating them so badly. Sure, non-profit busywork isn’t exactly a good time to be had by all but it pays the bills and for the Big 4, there is no such thing as bottom of the barrel.

Take what you can get, right?


Crain’s:

The financial crisis blew up many big-name clients, leaving audit firms with excess capacity. Bear Stearns Cos., Merrill Lynch & Co., Washington Mutual Inc. and Fannie Mae disappeared from Deloitte LLP. Ernst & Young saw Lehman Bros. Holdings Inc. implode, while KPMG lost Countrywide Financial Corp. and PricewaterhouseCoopers lost Freddie Mac.

Gary Boomer, a Kansas-based accounting industry consultant, says Big Four firms sometimes are bidding less than $100 an hour for non-profit and public-sector work, down from $175 to $250 for junior auditors. “What they’re doing is buying some work to keep the staff busy,” he says.

That’s hilarious, shouldn’t we stop and think about why they allowed “the financial crisis” (you mean the unstable positions of those financial firms lost in the bloody battle?) to blow up so many of their big-name clients before we let them scavenge the scrapings for a tasty morsel of audit work?

I guess it works, it’s not like you’ve got guys in the cathedral on December 31st counting saint candles.

It could be worse. Here are some really nasty audits that the Big 4 could be doing in lieu of cheap non-profit and public sector work:

Joe Stack – Think about it, KPMG, you have some awfully tall buildings, be grateful.

Blackwater expenses – They really deserve their own audit team. It’ll keep those juniors busy, ifyaknowwhatImean.

C Street – Bonus side work helping Mark Sanford convert his dollars into Argentine pesos.

Whore yourselves out however you have to, guys, even if it means a door-to-door campaign for whatever audit work you can find.

Related articles

Face It People, Nothing Much Can Be Done About the Revolving Door

Revolving_Door2.jpgThere’s constant conspiracy theories bellyaching about certain companies getting their former big shots into public service and regulatory positions (we’re talking about you, Maxine Waters).
Well now there’s speculation about former Big 4 partners working at the IASB.
We get it, those who used to work at the big firms shouldn’t be writing the rules. So who the hell is going to do it? Shall we have the likes of Friehling & Horowitz appointed as the standard setters?
The large firms have the biggest pool to choose out of, so natch they’re going to have some of the better candidates to delve into this wonky rule-writing stuff. We’re probably lucky that there are people out there that actually want to serve on these boards, lots of Big 4 partners can barely turn on their computers.

Ernst & Young Is Here to Help (For a Small Fee)!

ernst_young.jpgWe thought that Ernst & Young was advising the New York Fed on the winding down of AIG out of the goodness of their hearts but it turns out it’s actually about the money.
E&Y could make as much as $60 million advising the New York Fed, which is 50% more than the initial agreement, according to Bloomberg. The NYF is also reimbursing E&Y for expenses, up to 10% of the professional fees. This occurs after the parties had initially said $40 million would be the cap but $60 mil is it, we swear, no more.
And because E&Y is solid like that, the firm is billing out partners and directors at discounted rates ($775/hour). I mean, ’cause, let’s face it, this thing’s a mess and E&Y is going to be working hard, working late, working weekends.
Ernst & Young’s Maximum Pay for AIG Advice Swells [Bloomberg]