Welcome back to another installment of “GC Shits on Legitimate Accounting Publications For Writing Stupid Advice.” I’m your host Adrienne. In today’s episode, we’re going to destroy this recent Journal of Accountancy article about how to improve cross-generational communication in a professional setting. Now that Generation Z has entered the workforce, colleagues at a single […]
Over the last few months, Facebook has been relentlessly pushing its Workplace by Facebook platform, expanding the app’s feature list while ramping up its marketing. Its most recent PR blitz occurred this past June, as Facebook unveiled the company’s new Workplace for Good program, touting free access to Workplace Premium for nonprofits and educational institutions among […]
If you like to work remotely, you’ll need to use virtual communication apps to stay in touch with workers and clients, keep everyone on the same page, and ensure key benchmarks are being met on time. But with the wealth of virtual communication app options available, how do you know which ones to choose? We […]
When my daughters, ages 10 and 8, are asked what they want to be when they grow up, my oldest says a professional basketball player, and my youngest wants to be a chef. Both good choices. No kid in their right mind would say accountant, journalist, or chief financial officer. As children, Bill Brundage had […]
Since Marsha tackled listening on Friday, I thought I’d share this post on writing I scribbled awhile back for Accountingfly’s blog. Writing is part of my job, so I take it pretty seriously. I write every day. I read well-written articles from a variety of sources. I like to read about writing as a craft. […]
You’ve seen the commercial where the clueless Millennial is being interviewed for a job. When the guy says, “We’ll call you” the phone rings. It’s the Millennial across his desk following up after the interview. There’s a fine line between efficient follow-up and being a pest. Business owners and managers respect efficient follow-up. They avoid […]
Think you can do that? If so, that'd be great. A new Interact survey conducted online by Harris Poll with 2,058 U.S. adults — 1,120 of them were employed, and 616 of the employed people were managers — showed that a stunning majority (69%) of the managers said that they’re often uncomfortable communicating with employees. […]
It’s busy season and most accountants are feeling the physical and emotional pain of long hours. While cryptic underhanded messages are the last thing you need, there’s no stopping anyone from sending mixed messages. I’ve been there and it takes time to fully understand what people are saying to you. For all you newbies, […]
Our well-behaved cousins over at AccountingWEB published an interesting article today with 10 questions young CPAs should ask firm partners. This is important because a lot of you are completely awkward and don't even know how to make small talk with recruiters (Exhibit A: Reddit), much less partners. Here's Phyllis Weiss Haserot's list: What do […]
Let's discuss: Every company, at some level, has a purpose. How well you are able to communicate yours internally could have a major effect on your employees' engagement levels. That's one of the more striking findings from a new survey from Deloitte. To put it in terms of numbers, 73 percent of employees who say […]
Yesterday we discussed the Vault business outlook rankings for public accounting firms. In general, I thought that mid-tier firms have a sunnier horizon than the Big 4 firms, with the obvious exception of PwC. That exception seemed odd to me, so I shot a question over to Derek Loosvelt who did the write-up on the Accounting […]
For some of you, this marks your first busy season. That's pretty relatively exciting. You'll learn many things along the way but communicating effectively with your peers and superiors will be one of the most important learning curves you'll climb in your young career. Likewise, for the veterans out there, it's imperative that you communicate […]
Last week the PCAOB announced that it was getting serious about audit committee communication after it was revealed that Ernst & Young kinda sorta didn’t think the Repo 105 sitch was worth brining up to the Lehman Brothers audit committee. Granted, Dick Fuld is pretty scary dude and has probably eaten plenty of Big 4 partners for breakfast in his day but avoiding the awkward convo this time around almost resulted in everyone fighting over stale hot dog buns in the street.
Oh sure, the PCAOB has been kicking this around for awhile but something needed to happen to get their motors going and it appears that the LEH/E&Y fallout has done the trick. We might be completely wrong on this but it’s becoming increasingly obvious that the PCAOB has lost faith in auditors to do their jobs and will continue to inundate them with rules until they get an “Uncle.”
How about that statement? It’s the typical press release whathaveyou including quotes from the bigshots:
“The proposed standard on audit committee communications is intended to enhance the relevance and effectiveness of the communications between an auditor and audit committee throughout the course of an engagement,” said PCAOB Acting Chairman Daniel L. Goelzer.
“The proposed standard contains appropriate requirements to achieve effective, two-way communication between the auditor and the audit committee, which we believe would improve audit quality,” said Chief Auditor, Martin F. Baumann.
So if we take Goelzer and Baumann at their word, audit committee communication has been pretty ineffective up to this point? That’s good to know.
And here’s the gist of the required communication:
• Communication of an overview of the audit strategy, including a discussion of significant risks, the use of the internal audit function; and the roles, responsibilities, and location of firms participating in the audit;
• Communication regarding critical accounting polices, practices, and estimates;
• Communication regarding the auditor’s evaluation of a company’s ability to continue as a going concern; and,
• Evaluation by the auditor of the adequacy of the two-way communications.
So there’s your checklist people. Sorry to ask but were these items not being discussed previously? One could assume that since these items are on the list, they weren’t always being discussed in practice. Does standard audit committee communication revolve around Gossip Girl? Tiger Woods’ mistresses?
This really appears to be an example of the PCAOB taking away auditors’ “professional judgment” and making them “professional inquisitors.” Further, as Jim Peterson has pointed out, checking off required communication will do nothing to protect auditors from liability in the future, “there is no legal defense or ‘safe harbor’ in American law based on proof of compliance with professional standards – box ticked or otherwise.”
In other words, make all the professional requirements you want, auditors are still going to get sued and claiming “But we checked the box!” will not work as a defense. So the rationale must have been checklists are fun and easy to follow? Sigh. You’ve got until May 27th to get your thoughts in on this thing before it gets rubber stamped. Get on it.
Press Release [PCAOB]
Last month we had a couple of posts on the year that was in Crowe Horwath layoffs. After learning about three rounds of layoffs and a CH exodus, we figured we had exhausted the details on 2009 for Crowe.
Not so! The latest on CH is that, like everyone else, the firm is gearing up for busy season desperately shortstaffed despite the end of their “Alternative Staffing Program”.
We’ve also learned that there were pay freezes across the board at CH last year. This included a couple of instances where newly promoted managers had their pay frozen despite being told “substantial changes in duties would be exempt from pay freeze.”
Right now our sources aren’t sure what to expect from CH in 2010 as communication from their leadership has been minimal. So all in all, it doesn’t sound like Crowe is all that different from the Big 4 despite claiming to be “a unique alternative” to them. Good luck to all the professionals at the firm in 2010 and keep us updated with all the happenings during your busy season.