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Big 4
KPMG faces staff uproar as job cuts expose communication breakdown [City AM]
Big Four audit firm KPMG is facing something of an internal comms meltdown, City AM understands, amid complaints of a lack of communication during a ‘mismanaged’ redundancy round. One source within the scope of the consultation told City AM that there was initially a lack of internal communication about the cuts. “We only got [news of] the advisory side, so when the news came out that it was 600 jobs…oh, audit has been hit as well.” They added that KPMG “didn’t do like a firm‑wide email being like ‘this is what’s happening with the firm’.”
Offshoring
Global Tax Returns Now Have A Gujarat Stopover [Times of India] Somewhere in an office block in Ahmedabad, a chartered accountant is preparing the tax return of one of the most famous basketball players who ever lived. Down the corridor, a colleague is sorting out the finances of a talk show host whose name is known in every English-speaking household on the planet. The names stay off the record. The work, however, is real. The clients are as A-list as it gets, and the people handling their finances are based in Gujarat. While the city’s reputation rests on its industrial heritage and a certain brand of Gujarati entrepreneurial instinct, a second economy has been growing in its office spaces — one built not on goods, but on numbers, and on serving foreign clients.
Audit
U.S. Audit Watchdog Should Rescind Its Independence Rules, SEC Official Says [Wall Street Journal]
The U.S. audit watchdog should rescind its rules around conflicts of interest for auditors and their clients and follow the Securities and Exchange Commission’s rules, which the securities regulator may change, an SEC official said. The SEC plans to weigh revising auditor independence rules over the next year, starting with releasing informal, nonbinding guidance based on companies’ recurring questions, Chief Accountant Kurt Hohl said backstage at a conference Thursday.
Grant Thornton launches new audit platform in US [International Accounting Bulletin]
Grant Thornton’s US member business, Grant Thornton LLP, has rolled out a new technology platform, gtap, aimed at reshaping how the company conducts audits. The system – short for Grant Thornton Analytics and Automation Platform – integrates analytics, automation and AI into each phase of the audit cycle.
AI
A new dashboard tracks how much KPMG workers use AI. They say it’s easy to game the system. [Business Insider]
Business Insider reviewed screenshots of KPMG’s dashboard and spoke about it with two employees, who asked that their names not be used because they did not have permission to speak to the media. These employees said that while the dashboard is designed to incentivize AI adoption, it’s easy to manipulate and may not accurately reflect the true extent of AI use in their day-to-day work.
Pentagon to lean on AI to achieve audit goals [DefenseScoop]
“We’ve got a mandate. Congress passed a law that says that we need to get a clean opinion by our FY28 agency-wide financial statements. If not, they’re going to start taking money from us, significant amounts of money,” Tom Harker, deputy CFO in the Department of Defense comptroller’s office, said Tuesday at the UiPath Fusion conference, presented by FedScoop. “Substantive test work is onerous, painful. It’s pulling data, it’s doing large sampling across the enterprise. It takes a lot of work. It’s non-value-added work in that it only helps you with regards to auditing, and doesn’t give you better insights, doesn’t give you better information to make decisions,” he said. “What we’re adding into it is AI [and] automation.”
Education
Three Students, Similar Paths [CPA Journal]
Sustainability accounting and reporting (SAR) is reshaping how students view the accounting profession, broadening the accountant’s role to guide an organization’s sustainability initiatives and communicate their outcomes. In this article, three college students reflect on how sustainability concepts have influenced their emerging professional goals and identities.
Firm Watch
Forvis Mazars UK CEO: We have what others are trying to buy [City AM]
The UK boss pushed back on the idea that AI is the primary driver of pressure in the professional services sector, stating that he sees geopolitics and macro‑economics as the bigger drivers. “Part of me thinks that narrative is used as a rationale to explain why results aren’t where they should be when there are different reasons.” He added: “I would put [slower growth] much more down to geopolitics, economic uncertainty as a whole”.
Large accounting firm will open new KC office at H&R Block’s downtown HQ [Kansas City Business Journal]
RubinBrown recently leased new Kansas City office space in H&R Block’s world headquarters, keeping the accounting and consulting firm in the Central Business District.
Tax
CP53E notice tied to paper-check transition causes confusion [Journal of Accountancy]
Fraudulent or legitimate? In error or correct? Those are among the questions taxpayers and tax professionals are asking after the IRS sent over a million CP53E notices to taxpayers advising them to update their bank information within 30 days for a direct deposit. Some are skeptical because the notices include a QR code, and some practitioners say their clients owe money and are not due a refund.
The tax treatment of tariff refunds for inventory [JD Supra]
Following the Supreme Court of the United States’ decision invalidating most tariffs imposed under the International Emergency Economic Powers Act of 1977, many companies expect to receive tariff refunds with respect to inventory. Companies that receive refunds must determine how these refunds are treated for tax purposes, which depends on whether the underlying tariff costs already have reduced the company’s income through cost of goods sold.
States move to shut door on startup tax break expanded under Trump’s OBBBA [InvestmentNews]
A federal tax incentive long favored by venture capitalists and startup founders is drawing fresh fire from state governments, tax policy analysts, and critics who argue it overwhelmingly benefits the ultra-wealthy while adding unnecessary bloat to the tax code.
Taxing Advertising Would Modernize State Sales Tax Bases for the Information Age [Institute on Taxation and Economic Policy]
Advertising is an example of a service that has long been exempt from nearly every state’s sales tax. In the last two decades, however, the entire field of advertising has changed, with profound impacts on consumers, so it is worth reconsidering whether this exemption is still sound policy (if it ever was). The big change is that most advertising today is delivered to individual consumers based on data about their characteristics, behaviors, or interests, rather than showing the same ad to everyone. Such targeted advertising has not only displaced most traditional advertising, but it is also one of the fastest-growing segments of the economy.
You May Be Owed a Tax Refund From the Covid Era [New York Times]
The regular 2026 tax filing season ended last month, and many taxpayers have already received their refunds. But tens of millions of Americans may also be due refunds of a different sort — on tax penalties and interest charged during the Covid-19 pandemic. The refunds aren’t guaranteed, because they result from a court decision that the government may still appeal, according to Erin M. Collins, the national taxpayer advocate. She heads a group within the Internal Revenue Service that works on behalf of taxpayers. But to preserve your eligibility should the court ruling stand, you must file refund claims with the I.R.S. by July 10, Ms. Collins said in blog posts aimed at making people aware of the situation. “At the center of this issue are taxpayers who may be entitled to refunds but will never claim them,” she said in an email.