Friday Footnotes: KPMG Switcheroo; Deloitte’s Gender Pay Problem; Death to The Big 4 Oligopoly | 9.27.19

KPMG switches 820 UK staff from advisory to audit [Financial Times] KPMG has moved 800 staff and about 20 partners from its advisory division into its audit department in preparation for a possible forced break-up. Any consultant who spends more than 10 per cent of their time advising auditors will now sit within the audit department in a move towards a “more separate future”, according to a person briefed on the firm’s internal communications.

PwC Considers Changes to U.K. Auditor Pay to Avoid Conflicts of Interest [Wall Street Journal] PricewaterhouseCoopers LLP is considering changes to how its U.K. audit partners are being remunerated to avoid potential conflicts of interest. The potential changes to auditor partners’ pay and bonuses are part of a wider review of how its U.K. business is operating.

Mylan Misled Investors Over EpiPen Pricing Probe, SEC Says [Bloomberg] Mylan NV misled investors for at least a year about a Justice Department investigation into the allergy shot EpiPen that would eventually cost the company nearly $500 million, the U.S. Securities and Exchange Commission said Friday. The settlement appears to close one part of a long-running saga over a product that boosted Mylan’s sales but also brought controversy. Under the agreement with the SEC, first disclosed as a settlement in principle by Mylan in July, the drugmaker will pay $30 million.

Judge: Former Mason mayor, Ohio lawmaker can seek CPA license he lost after conviction [Dayton Daily News] A Warren County judge said Thursday that a former Mason mayor and Ohio lawmaker is allowed to again seek the CPA license he lost four years ago after being convicted on felony theft, perjury and securities-related charges. Pete Beck, 66, of Mason, petitioned the Warren County Common Pleas Court for a Certificate of Qualification of Employment (CQE), which is the process for a person convicted of a felony or misdemeanor to apply to the court to lift the collateral sanction barring him or her from consideration of employment in a certain field.

Big Four accountants facing changing times [Financial Times] The Big Four accountants have enjoyed an oligopoly over the audits of the largest listed companies in the UK and US, with some relationships dating back more than a century. But amid increasing scrutiny from politicians and regulators in the wake of high-profile corporate collapses, structural change, at least in the UK, looks certain.

Deloitte total gender earnings gap is 39.3% [economia] Deloitte’s 2019 mean pay gap is 18.7% (18.1% in 2018) and the median pay gap is 16.1%, same as last year. The firm’s median bonus gap is 35.1%, down from 37.5% in 2018 and its mean bonus gap is 51.1% (52.3% in 2018). In 2019, 41% of all partner promotions were women and 34% of director promotions were women. Less than a quarter (21%) of partners are women and less than a third (30%) of directors are women.

The future is now for audit [Accounting Today] One important guiding principle to remember: technology must enhance professional judgement, but not replace it.

Prosecutors agree to pause in subpoena for Trump tax returns [CNBC] In a letter Thursday to Manhattan federal court Judge Victor Marrero, a prosecutor in DA Cyrus Vance Jr.’s office wrote that “the parties have reached a temporary agreement” to “forbear enforcement” of the subpoena to produce years of Trump’s financial documents. Prosecutors will hold off trying to enforce the subpoena until Oct. 7 at 1 p.m. ET — or until two business days after the judge rules on whether subpoeane should be permanently barred or whether it can be enforced over Trump’s objection.

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