Earlier this month, we mentioned a rumor we heard about PwC putting in calls to the rank
in and file of one industry group in the tax practice. The caller was just letting them know that their utilization was getting the crook eye by the partner in charge of the group. Not exactly something that would give you the warm and fuzzies Well, now have another report of P. Dubs putting people on notice:
I was recently informed that despite my good performance and strong mid-year reviews, “[my] utilization is being watched.” Its nice to know that this company values cold metrics as opposed to quality, hardworking employees.
Here’s a question: who at PwC thought that notifying employees that their utilization is being scrutinized was a good idea? Especially since Bob Mortiz sent an email to say that it’s unlikely that there will be layoffs in tax and assurance?
One email says “don’t worry, everything is fine” while someone else calls you up in order to scare the bejesus out of you by letting you know that despite your fine performance someone is watching. Can anyone explain the rationale? Our emails to PwC have gone unreturned, so we’re all ears.
Satyam wants the U.S. Courts to kindly BTFO of business that should be handled in India. Specifically these silly fraud lawsuits.
Besides, PW India has already said that they want to bury the hatchet, so they feel that this whole will be best handled in the Eastern Hemisphere:
In a court filing yesterday, the software-services provider said it was joining a motion by its auditors, Price Waterhouse and Lovelock & Lewes, to dismiss the American fraud suits brought by investors.
“This case belongs in India,” the auditors wrote. “Satyam’s alleged billion-dollar fraud, as well as the allegedly improper audit, took place in India. Virtually all of the defendants are India-domiciled companies or individuals.”
P. Dubs India and Lovelock want the whole thing dropped since they were acting on the honor system. Annnnnnnd, since PwC International doesn’t have control over any of the individual firms they’d like it very much if the judge just dropped them out of this thing too:
PricewaterhouseCoopers International Ltd. said it should be dropped from the case because the investors failed to show it had control over its Indian member, Price Waterhouse, as is required by U.S. securities law.
From the looks of it, no PwC firm wants to be responsible for anything that went wrong with Satyam even though they signed the audit report. Fine, so can we agree that audit opinion was worthless? That’d be great.
Satyam Says U.S. Fraud Suits Must Be Moved to India [Bloomberg]
Accountancy Age has a extra puffy puff piece on P. Dubs’ “head of sport” Julie Clark and how PwC will be everyone’s hero — and she’ll be a regular Einstein — if England can land the World Cup for 2018.
Sidebar: According to the piece, E&Y is sponsoring the Ryder Cup next year and Deloitte is sponsoring the Olympics in 2012. This brings up two points: A) Real original E&Y and B) What the hell, KPMG? If you want to keep up with the Joneses you better dump that always-a-bridesmaid (okay, occasional champion) golfer and get those letters on a BCS bowl or something.
Not only does Accountancy Age not give any details on Clark’s plans but they also manage to completely ignore the ingenious marketing campaign/sponsoring opportunity that would all but lock this thing up.
Need we remind everyone of our first brilliant (albeit subtle) suggestion regarding an accounting firm and a certain sponsored golfer? Working out, isn’t it?
Make no mistake, I’m sure Ms. Clark knows what she’s doing and we’re not expecting her to take our suggestion that seriously but if she blows it…We’ll be expecting a call.
Bob Moritz, the U.S. Chairman, is trying to calm everyone down, as an email has been sent to the troops letting them know that it’s unlikely that there will be layoffs in the Assurance or Tax practices. We haven’t been able to track down a copy of the email yet but that’s the gist.
While this is good news, we would be more comforable if the email would have read something like:
“We’re absolutely, 100% sure that no one in Assurance and Tax will be laid off like we just did in Advisory. Write it down. No one. Not even you, guy that dicks around in the cubicle by the window so that he can see everyone approaching. Your utilization is in the crapper but it’s cool. You’re safe.”
Or he simply could have just added the photo to the email so everyone would feel better. Nothing says, “trust me” like a fresh pair of P. Dubs tighty-whities, amiright?
We’ve received a tip that human resources for PwC has made calls to staff saying “the lead partner [of the] group is reviewing everyone’s utilization numbers one person at a time.”
This is occurring in at least one industry group in the New York tax practice. Although our source stated that it was not unexpected for utilization to be scrutinized, it seemed unusual for a lead partner to be examining so many individual utilization numbers. Then again, PwC isn’t really known for a transparent performance review process.
Since the forced ranking trend seems to be in full effect, this could be the new standard operating procedure. The timing also seems dubious in the wake of (or during) last week’s layoffs in the advisory practice.
If you’ve recently been informed that your utilization rate is getting a close eye (and this comes as surprise) or if you know of the motivation behind such close inspection, email us at email@example.com.
We’ve confirmed that the layoffs have started.
The first casualty that we know of was out of the Boston office and worked in Forensic services. No severance details as of yet. Kindly update us with your office, service line and severance details.
Maybe it’s just an informational sit-down for the new P. Dubs tighty-whities that you’re all going to be expected to wear but our contributor, Francine McKenna had this ominous tweet:
Apparently someone else may have an itchy trigger finger. According to the comments over at RTA the emails have gone out to an office on the east coast but nothing more specific than that.
Keep us updated if you get a notice or if you know someone who gets a notice, or you know someone who knows someone, etc.
Hey, any win is a good win, right?
A has judge ruled that there was no evidence that the Delhi office had anything to do with the actions of the Bangalore office, the statutory auditors of Satyam.
The Institute of Chartered Accountants of India (ICAI) — the AICPA of India — had brought actions against PwC offices in Delhi, Kolkata, and Bangalore but the judge isn’t buying that they are related:
“They are separate partnership firms with separate balancesheets. There is no inter-connection (between PW Delhi, PW Bangalore and PW Kolkata [ Images ]) and profit and loss of one cannot be shared by others. You cannot say that the Banglore firm which was statutory auditor of Satyam has anything to do with Delhi firm,” said Justice Sanjiv Khanna.
The court did indicate that if the ICAI wanted to take another shot at Delhi — you know, with some evidence — if it so chose.
P. Dubs has to be happy with the small victory but would probably prefer if their previous suggestion to just forget this whole thing would start getting some traction.
We’re not going to say that the pending endorsement of Becks’ undies has anything to do with it but that guy doesn’t come cheap.
I’ve just received word: There was a PwC Advisory partners emergency conference call tonight announcing upcoming involuntary staff reductions.
(This time the source is impeccable.)
New US Advisory Leader, Dana McIlwain laid out the bad news: The time has come to cut. Average utilization is hovering at 69%. Cash collections are millions short. Campus recruiting for Advisory has been stopped cold. Business sucks and then there’s the 800+ BearingPoint folks to absorb.
On November 11th the rank and file partners, fortified after training and coaching by HR via a webcast in the next few days, will chop 300+ professionals from PwC Advisory, at all levels, all geographies, all practices. Most have already seen the writing on the wall via forced ranking.
Well, crap. We’re not talking Lotus Notes developers this time around. If the guillotine does indeed drop next week, it probably won’t come as a surprise with the less-than exciting revenue numbers and the rumors that the firm was phoning in no raises for fiscal year 2010.
We’ll keep our ear to the ground on this but in the meantime, let us know if you’ve got more details on these rumored layoffs or if you get an unexpected email much earlier than next Wednesday. It’s been known to happen.
Veteran’s Day In PwC Advisory: Say Auf Wiedersehen [Re: The Auditors]
Nothing is official with Becks of course but PwC has signed on as the first sponsor of England’s bid to host the World Cup in 2018.
Seriously, P. Dubs. Think about it. With the sole exception of RSM McGladrey, accounting firms are totally rejecting the “sex sells” mantra. This is your opportunity.
PWC backs England’s World Cup bid [BBC]
P. Dubs India wants to avoid having a long, tedious, legal battle over this whole thing. Nobody wants that. So they offered a consent application to the Securities and Exchange Board of India (SEBI) to say sorry about the mixup and let’s just forget the whole thing ever happened.
Not that burying the hatchet won’t take time. The SEBI seems to have an even more dense bureaucracy than the SEC:
The application will be looked at by the Internal Committee of SEBI. If the committee feels that there is merit in this consent, both sides are willing to come to a certain point, it goes to a high power committee on consent proceedings which is headed by a retired Bombay High Court Judge.
Based on the committee’s decision, both sides will sit across the table and decide whether or not they agree with the punishment that could be meted out. As per the consent agreement, there is no acknowledgement of wrong doing.
Oh right, did they mention that last part? There’s nothing to gained by pointing fingers at any one responsible individual or company. PWI would just prefer that they come to an agreement where
they aren’t no one is to blame. Problem solved!
PwC hands out olive branch to SEBI in Satyam case [Money Control]
That’s right! We’ve confirmed that PwC’s annual employee survey went out Monday and unlike other firms, the rank and file at P. Dubs are more than happy to tell TPTB exactly how they feel without being bribed (but it would be nice).
It appears that Overland Storage’s audit committee was pissed off enough about a second consecutive going concern audit opinion that they just up and fired PwC last week.
San Diego-based Overland filed the 8-K, notifying the Commission of the dismissal, on October 16th which also named Moss Adams as the new auditors. At the request of Overland, PwC sent a two sentence letter to the SEC stating that they “agree with the statements concerning our Firm in such Form 8-K.”
The Register states that Overland was all bent out of shape because PwC didn’t explain why they issued the going concern opinions:
While even accountants are entitled to a view about the state of the struggling business, Overland was upset because PwC didn’t actually identify any specific factor in the accounts that led them to that conclusion.
Presumably PwC was expressing a view based on such business events as Overland avoiding running out of cash by factoring arrangements, repeated staff headcount reductions, Nasdaq delisting, declining revenues and losses. Overland’s thinking is that, if so, it shouldn’t have.
The most recent 10-K has all the gory details and as The Register pointed out, Overland didn’t think all those negative things really matter, so obviously, firing the auditors was the next logical step. Moss Adams will get the esteemed pleasure of holding Overland’s hand to the bitter, tragic end.
Whores PwC employees in Romania are being sent on mandatory vacay starting this month through June 2010. The leave will be for fifteen days and will be unpaid, according to Ziarul Financiar, a daily financial newspaper published in Bucharest.
We were hoping that the firm would require everyone to take the same fifteen days off in order to participate in a firm wide charity event but instead PwC Romania has asked to employees to take turns being quasi-unemployed for half a month and will simply do more with less.
This is not a measure that we have heard about occurring Stateside but there have been delayed start dates and sabbaticals which some may say are close enough. However, the innate ability for Big 4 types in the U.S. to show up to work when they aren’t supposed to would certainly foil any potential cost savings. Until, of course, someone reminds them, “Aren’t you supposed to be on vacation?” to which the glutton for punishment replies, “Oh, I’m not charging the time.”
Oh sure, anything is possible. However, on top of everyone not called Fox News calling P. Dubs the most shameless whore ever to issue a report on anything, Jonathan Weil at Bloomberg is now calling out some of P. Dubs’s (and KPMG probably for good measure) banking clients’ less-than consistent use of mark-to-whatever-the-hell-we-like.
Weil names three PwC clients (Midwest Banc Holdings, First Bancorp, BB&T Corp.) as showing loans with fair values greater than their carrying values as of June 30th. Midwest and First Bancorp’s stock prices are trading far below book value while BB&T’s stock price trades above book value.
As Weil points out, WTFK if these values are right or not? What is obvious is it seem like some banks are legitimately making a run at fair value and others are still using a dart board. Oh, and the PwC audit teams are okay with that. Nevermind comparability, Dow is above 10k bitches! Onward!
Mark-to-Make-Believe Turns Junk Loans to Gold [Bloomberg/Jonathan Weil]
We’ll assume everybody is down with the KPMG Pomeranian and Uncle Dangle for Deloitte. If not, speak now or shut your pieholes.
There’s some resistance to the idea of famous Governor banger, Ashley Dupre, being worthy of the PwC Mascot.
Frankly, since P. Dubs has made some feel like prosties already and has also shown that, as firm, they don’t mind whoring themselves out for some scratch, the argument can easily be made that Ashley is the perfect mascot. On the other hand, the point has been made, and is duly noted, that high-priced call girls are much cooler than any accounting firm.
So you see the problem here but it’s not our decision. We’ll leave it up to you. State your submission for the PwC mascot and give a brief explanation for said suggestion in the comments.
Keep it clever people, mascots already assigned to any other team or organization will be ignored with extreme prejudice. On with it then.