Author: Caleb Newquist

Founding editor, Going Concern.

Iowa Businessman Could Really Liven Up Your Accounting Firm’s Firings

If you’ve been in public accounting for a number years, you’ve certainly seen your share of colleagues get shown the door either due to work performance that was not up to par, “a slow down in the marketplace,” or engaging in office antics that are typically frowned upon. This is typically handled in a manner befitting of a professional accountant. That is, a very solemn conversation in a partner’s office with regrets, thanks for service, yada yada yada.

William Ernst (no relation, I’m guessing) is a Bettendorf, Iowa businessman that owns a chain of QC Mart convenience stores, and he was sick of his employees acting up. Fooling around behind the counter, bad language, smoking grass wearing hats. Poor clerking. To help make his point, Mr. Ernst decided to start a little contest and sent a memo to employees laying out the groundrules:

“New Contest – Guess The Next Cashier Who Will Be Fired!!!

To win our game, write on a piece of paper the name of the next cashier you believe will be fired. Write their name [the person who will be fired], today’s date, today’s time, and your name. Seal it in an envelope and give it to the manager to put in my envelope.

Here’s how the game will work: We are doubling our secret-shopper efforts, and your store will be visited during the day and at night several times a week. Secret shoppers will be looking for cashiers wearing a hat, talking on a cell phone, not wearing a QC Mart shirt, having someone hanging around/behind the counter, and/or a personal car parked by the pumps after 7 p.m., among other things.

If the name in your envelope has the right answer, you will win $10 CASH. Only one winner per firing unless there are multiple right answers with the exact same name, date, and time. Once we fire the person, we will open all the envelopes, award the prize, and start the contest again.

And no fair picking Mike Miller from (the Rockingham Road store). He was fired at around 11:30 a.m. today for wearing a hat and talking on his cell phone. Good luck!!!!!!!!!!”

Any firms considering cuts in the near to intermediate future, could really do well by this method. Although, since we’re dealing with a workforce that’s a little preoccupied with money, you’ll probably have to up the award to $100.

Firing contest by boss leads employees to quit [DMR]

Is This Ernst & Young Auditor the Next Character on Glee?

I don’t watch Glee. Hell, I don’t even have TV. I did flip through the GQ spread with Lea Michelle and Dianna Agron but otherwise, I’m completely unfamiliar with any of the characters on the show. ANYWAY, I hear it’s popular. It’s so popular that regular people want to be characters on the show as overblown versions of themselves and are submitting auditions for a chance to do so. One of these regular people is Nick DeSanto, an auditor at Ernst & Young.

We can’t embed Nick’s audition video from the Glee Project web page but we did find his YouTube channel so we can give you idea of his talent:


More about Nick – he worked for a couple of years at McGladrey before joining E&Y’s FSO Media & Entertainment group, where he’s been for about a year. We spoke to him over email and by phone (he “visit[s] GC almost every day”) and that this audition is his first stab at breaking into showbiz. Can you imagine if he had been involved with the In a JIT project? His singing career would already be on the fast track, winning Tonys and such.

So go over and support him at his Glee Audition page by liking his page if you feel so inclined. And even if you don’t feel the urge, go and like/vote for him anyway. Just because your dreams won’t come true, doesn’t mean you can’t support someone who’s trying to do something to achieve theirs.

Tax Refunds From ‘Secret Government Accounts’ Still Turning Out to Be Bogus

What’s most interesting about this particular scam is that it involved more people – 55 – than some accounting firms’ entire headcount.

A grand jury has indicted 55 people for participating in scams that tried to bilk the government out of more than $250 million in undeserved tax refunds, prosecutors in California said on Monday. Thirty-two indictments were returned by the grand jury accusing the people of various schemes to obtain the refunds. Millions of dollars were paid out, including a check worth almost $1.2 million, the prosecutors said. The owners of one California company were accused of making presentations that claimed customers could get tax refunds from a “secret government account” after making payments to the company and agreeing to pay a percentage of any refunds they received, the prosecutors said.

Grand jury indicts 55 for $250 million in tax scams [Reuters]

Are You a Loser If You Don’t Make Partner at a Big 4 Firm?

Good morning capital market servants. Presumably, none of you were on the Brooklyn Bridge yesterday which also probably means you’ve still got a job, a career to think about, etc. etc.

How’s that going by the way? Are you on the partner track or do you have partner tracks on your back? Haven’t given it much thought lately but hey, this is what you’re doing and sure, making partner seems like a sweet gig, amiright?

Well an interesting statement from the Grumpy Old Accountants today got me to thinking about all of you hoping for a seat at the big table:

In fact, in the Big Four accounting firms today, if you don’t make partner, you often are considered a loser.


Now this little snippet comes out of a much larger discussion about why some many accountants are cheaters (it’s because everyone wants to be perceived as a “winner”). That’s a fine discussion as well, and the GOA post is worth a read, but we’ll focus on the notion that “no parter = loser.”

I certainly had my own partner aspirations for a brief point in time and many of you out there in Big 4 land have them right now. For me, my attitude changed when I observed a few partners, saw what their workload and lives were like and thought, “JESUS H. CHRIST, BEING A PARTNER SUCKS.”

The problem is, if you’re appear to be making a career for yourself at a Big 4 firm (I was quite the nomad which doesn’t really work), what is the ultimate goal? No one says to themselves, “I’d be fine with making Senior Manager in 8-10 years and then spending THE NEXT 30 in that same position.” As such, partner is a goal for many of you. However, we all know that Senior Manager is a parking lot in most service lines, so it may not be 30 years at SM but it’ll sure seem like 30. Having said that, if you like your firm, are reasonably good to FUCKING AWESOME at your job, then why wouldn’t you want to make partner? Not all Big 4 partners are created equal but if you’re on the fast track at PwC, would doing anything less than being admitted to the partnership satisfy your professional ambitions? And if you give up on career goals because…well, just because…does that not make you a L-O-S-E-R?

The answer is no. Personally, I’ve seen plenty of people with partner-level talent, hot on the partner track give it up because 1) something better comes along; 2) They want their life back; 3) SOMETHING BETTER COMES ALONG. In fact, many new partners are working harder than ever (i.e. “like a 2nd Year Senior Associate” has been overheard). Does that sound like a “winner” to you? GOA might have it exactly bassackwards. The last thing most Big 4 alums will tell you is that they feel like losers because they didn’t make partner. Quite the opposite in fact. It’s probably more accurate to say you’re a loser if you think you’ve got a shot at making partner at a Big 4 firm.

UDPATE:
Professor Ketz clarifies below (seen via Twitter) that they the GOAs were talking about the culture within the Big 4 firms rather than you individual losers:

As we said, “… IN THE BIG FOUR ACCOUNTING FIRMS TODAY, if you don’t make partner, you often are considered a loser” (emphasis added). We were discussing the culture of the large accounting firms–we were not discussing our evaluations of those who are not partners. After all, we aren’t partners and we hope we aren’t losers!!

I’ll continue my contrary narrative here and argue that this not the case either. As we know, Big 4 firms sell themselves as great places to start careers but they don’t regularly make the case that this is where you want to spend 15-20 years of your professional life. The culture inside has evolved to accept attrition as part of the formula and that younger professionals are anxious when it comes to getting ahead. In fact, things have changed so much that convincing the talented professionals to stay is part of the culture. Hearing “You’ve got a bright future here,” from a pair of partners over lunch is standard these days because they know the “winners” will leave and the “losers” don’t know when to get out.

Accounting News Roundup: PwC Jumps Deloitte with Over $29 Billion in Revenue; Cain’s 9-9-9 Deal; Groupon May Suffer From Shrinkage | 10.03.11

PwC reports record $29.2 billion revenue, regains lead [Reuters]
Growth in its consulting business helped PwC increase revenue 10 percent in fiscal 2011, allowing it to regain its position as the world’s largest accounting and consulting firm. PwC’s global network of firms reported record revenue of $29.2 billion for the year that ended June 30, up from $26.6 billion in 2010 and the strongest growth since 2008. PwC, formerly known as PricewaterhouseCoopers, also said on Monday that it plans to hire a record 20,000 graduates worldwide in fiscal 2012 and offer training internships to 10,000 students. Its staff now numbers about 169,000.

[WSJ]
The Republican presidential candidate wants to scrap the current system—with its income-tax rates as high as 35% for individuals and corporations—and replace it with a system that combines a 9% personal flat tax, a 9% corporate flat tax and a 9% national sales tax. The plan would eliminate the estate tax as well as current taxes on investment income, in an effort to boost investment and the economy. The Cain plan also would eliminate the payroll tax that hits many working-class Americans hard, and instead fund entitlement programs such as Social Security from the new revenue structure.

Financial services set to shed 8,000 jobs [FT]
The UK financial services sector is set to shed 8,000 jobs over the next three months as turmoil in global markets damps growth prospects, according to a survey by the CBI employers’ group and PwC, the professional services firm. The pace of business growth in the financial sector continued to slow in the three months to September and is expected to be slower still in the final quarter. For the first time in two years, companies expect there to be no improvement in profitability.

Salary vs sleep: Which would you pick? [WaPo]
Which would you prefer: An $80,000 job with reasonable work hours and seven and a half hours of sleep each night, or a $140,000 job with long work hours and just six hours of sleep? A new study from researchers at Cornell, to be published in the American Economic Review, found that most people would pick the higher-paying job with more hours and less sleep.

In Debt Talks, Divide on What Tax Breaks Are Worth Keeping [NYT]
The 71,000-page tax code has become loaded with dozens of obscure but economically valuable tax breaks. Nascar racetrack operators can speed up their write-offs for improvements to their facilities; makers of toy wooden arrows pay no excise tax; and Eskimo whaling captains get a charitable deduction of up to $10,000 for hunting blubber. Multibillion-dollar operations like oil refineries, Hollywood productions and hedge funds have all profited. And there is little sign that the lawmakers who helped write the breaks into the tax code are willing to back away from them. Whether any of them are scrubbed from the books may ultimately prove how serious Congress is about reducing the debt, and how adept powerful lobbies are at guarding their benefits, political analysts and tax experts say.


Groupon’s Stumbles May Force a Smaller IPO [Bloomberg]
Groupon Inc., the largest online- coupon site, may have to settle for a smaller initial public offering as management gaffes, restated results and regulatory scrutiny leave investors leery of owning the stock. The valuation might need to drop to as low as $3 billion to $5 billion to entice shareholders, said Josef Schuster, founder of IPOX Schuster LLC, which invests in IPOs. That’s a fraction of $25 billion that was said to be discussed as a potential valuation when Groupon met with underwriters earlier this year. It’s also below the $6 billion Google Inc. (GOOG) offered last year. “Interest is diminishing by the week,” said Schuster, who manages $2.5 billion in assets for the Chicago-based fund. “All the news that’s coming out underlines some form of turmoil in the company. As an IPO investor, you don’t want that.”

KPMG LLP Names Steven Hill Vice Chair — Strategic Investments [KPMG]
Replacing Mark Goodburn.

Deloitte Auditor, Contemplating a Busy Season Walkout, Concerned That Fellow Employees Aren’t as Enthused as He Is

You may have heard a few stories about a little campout going on down on Wall Street the last week or so. It’s been quite a ruckus and now Hizzoner is even getting a little tired of it. Despite the good, the bad and the hippies, all this standing up and shouting and whatnot seems to have inspired one “disenchanted” Deloitte auditor who sent u

I know that I work for my firm in an at will contract, I can quit at anytime and get another job. But I’ve been feeling so slighted for the last several months by leadership’s complete lack of concern for the well being of their workforce that I want to do something more significant. If I quit, some managers will be temporarily upset because my hours will need to be replaced, and they will find someone who doesn’t have the same experience with the client etc. They will get over it in a day, and the giant audit machine will keep turning the same as always, and employees will continue to get the worst of it.

But this is America, we are champions of workers’ rights. Can’t we do a little better than this for ourselves? I understand that with unemployment currently so high this isn’t really a time when workers’ rights are a high priority, but we still deserve better treatment. With Deloitte still swelling based on last weeks’ figures, and loving the attention in the media for being a model of a growing global enterprise their vulnerability becomes clear. They would hate bad press or anything that would stunt growth.

This is why I think an organized but non-unionized strike/walkout, perhaps around, I dunno, the upcoming busy season, would be very effective at getting leadership’s attention. I know I’m no Cesar Chavez, and a white collar walkout it rare thing, as white collar unions are uncommon, and that this is something that would be difficult for generally conservative accounts who are typically anti-union to get done. But I figure, if there is any forum where this sort of movement would/could begin it would be on Going Concern where people are more openly cynical and feel just as disappointed with Deloitte’s version of an audit practice as I do. Not sure who would actually put their careers on the line because I doubt most really believe in the cause, but I think they feel the same sentiment. It would be interesting to hear the true anonymous thoughts of others on this idea, and if there are any brighter ideas on reminding firm leadership whose backs they are standing on to potentially improve the livelihood of those backs. What do you recommend?

Well, Cesar, I do have a few recommendations for your planned walkout. First – take pictures. Lots of them. And then send them to us. Secondly, get a noisy instrument. Preferably a drum or vuvuzela. If you have to do this mission solo like you think you will, you’ll need some help in the noise department. Third – a costume of some sort – I’m thinking Benji Bankes – would advisable and then be sure to incorporate suggestion number one. Fourth – read Adrienne’s post from this summer on why this is an awful idea. The whole thing is worth a read but here’s a taste:

I think part of the reason why anyone you suggest this to might think you’re one tax season away from the funny farm is that CPAs already have a large, powerful trade association which allegedly exists to serve its interests. Granted, the AICPA does more lobbying in Washington than it does to accounting firm partners about easing up on you poor shlubs who have to do all the work, but it’s still a trade association.[…] [T]hough it may not feel like it, most of you are paid pretty fairly compared to, say, McDonald’s cashiers, Starbucks baristas and Walmart greeters. It may not feel fair based on the service you provide (understandably) but in the big picture, making $50,000 a year fresh out of school in middle America ain’t too bad of a gig. You get vacations, safe work conditions, bonuses, insurance and even free CPA review materials if you’re lucky. I bet OSHA has never seen the inside of a Big 4 office to investigate a fatal Excel accident or random intern decapitation at the coffee machine.

Maybe I’m wrong but the leaders of these firms would love – LOVE! – if you wrote them an email about your concerns. If the response you get sounds canned, then there’s nothing wrong with saying so. Your partner may catch some heat (that will eventually blow back on you) but Dr. Phil and JoeE aren’t really doing their jobs if they simply dismiss the widely held concerns of the Green Dot community. If you’re feeling inspired enough to rally some fellow opiners, make some signs and sit on the sidewalk shouting, then by all means do so but do keep in mind that you will end up in these pages, may be permanently confined to a JIT or straight up lose your job. Just some things to mull over.

Warren Buffett Would Like to Clarify His Feelings on The Buffett Rule

“It isn’t [my idea] to have the rich pay more taxes. It’s to have the ultra-rich pay more,” he said on Bloomberg Television Friday. “It isn’t to have the rich pay more taxes. It’s to have the ultra-rich who are paying very low tax rates pay more taxes. There’s all kinds of ultra-rich who pay normal taxes, but there is a small segment–but you can find them very easily–who pay very low taxes, including me. People who make money with money only pay very low taxes at very high levels of income. … What I’m talking about would probably apply to 50,000 people out of 310 million in the country. [BBR/The Hill]

Take the Going Concern Fall Survey for a Chance to Win an iPad

Happiest of Friday, capital market servants. All the scary news out there got you down? It’s tough, I know. Unfortunately, there’s very little we here at Going Concern can do about it. Adrienne has yelled at everyone imaginable but still things are sucky.

The good news is that the TPTB here are still neck-deep in their never-ending quest for world domination and they need you to take our reader survey. Because we know your time is valuable (or at least it should be), we’re giving you a chance to win an iPad just for humoring us.


I know, our generosity is overwhelming at times but don’t get the impression that we equate love with cool-ass gadgets. Wait…maybe we do. Anyway, just take a few minutes to take our survey and you’ll have a chance to win.

Thanks for your continued support of Going Concern.

Accounting News Roundup: DOJ Poking Around Chinese Accounting; Most Investors Okay with Buffett Rule; FASB Revisiting Going Concern | 09.30.11

Justice Department probing Chinese accounting [Reuters]
The Justice Department is investigating accounting irregularities at Chinese companies listed on U.S. stock exchanges, said an official with the Securities and Exchange Commission, suggesting criminal charges may be brought in addition to civil proceedings. “There are parts of the Justice Department that are actively engaged in this area,” Robert Khuzami, director of enforcement at the SEC, said in an interview conducted on Tuesday and published on Thursday. A number of federal prosecutors around the United States were taking part in the investigation, he told Reuters, them.

FBI Probing Solyndra for Possible Accounting Fraud [Bloomberg]
Solyndra LLC, the solar-panel maker that filed for bankruptcy protection two months after executives extolled its prospects, is being investigated by the FBI for accounting fraud, an agency official said. The FBI is examining possible misrepresentations in financial statements submitted to the Energy Department, according to the official, who requested anonymity because the investigation is continuing. Disclosure of the fraud probe is likely to heighten Republican criticism of the Obama administration for its approval of a $535 million U.S. loan guarantee, which the company used to build a $733 million factory in Fremont, California, that opened in January.

Banks to Make Customers Pay Fee for Using Debit Cards [NYT]
Bank of America, the nation’s biggest bank, said on Thursday that it planned to start charging customers a $5 monthly fee when they used their debit cards for purchases. It was just one of several new charges expected to hit consumers as new regulations crimp banks’ profits. Wells Fargo and Chase are testing $3 monthly debit card fees. Regions Financial, based in Birmingham, Ala., plans to start charging a $4 fee next month, while SunTrust, another regional powerhouse, is charging a $5 fee. The round of new charges stems from a rule, which takes effect on Saturday, that limits the fees that banks can levy on merchants every time a consumer uses a debit card to make a purchase. The rule, known as the Durbin amendment, after its sponsor Senator Richard J. Durbin, is a crucial part of the Dodd-Frank financial overhaul law.

Canceled Flights in U.S. at 10-Year High [Bloomberg]
United Continental Holdings Inc. (UAL), Delta Air Lines Inc. (DAL) and other large carriers have scrubbed almost 104,000 flights this year through Sept. 21, or 2.36 percent of the scheduled total. A full-year rate at that level would be the highest since 2001, according to the U.S. Bureau of Transportation Statistics. The disruptions stem from a combination of foul weather in major markets such as New York and seating-capacity cutbacks to curb costs. When Hurricane Irene struck the East Coast in August, Cameron C. McCulloch faced a weeklong wait for a new ticket — so he drove the 3,000 miles from Seattle to Yale University to catch the start of classes. “There was too much uncertainty with the flights,” said McCulloch, 21, a Yale junior. “At least with driving I knew I’d be there on time and that I could control all the factors.”

You’re tax-exempt? That doesn’t always mean you’re tax-exempt [Tax Update]
Joe Kristan explains the riddle.

Obama’s Buffett Rule Backed by 63% of Investors [Bloomberg]
By a margin of 63 percent to 32 percent, respondents in a Bloomberg Global Poll approved of the president’s proposal, known as the “Buffett rule” in a nod to Warren Buffett, the chairman of Berkshire Hathaway Inc., who has said it is wrong that he pays a smaller share of his income in taxes than does his secretary.

Long Island Rail Road Expects ‘Near-Normal’ Morning Service [City Room/NYT]
Aka “typically awful.”


Pa. man frustrated with IRS sentenced for threat [HC]
64-year-old Leonard Mackey pleaded guilty on Thursday to threatening to use a weapon of mass destruction. Mackey says his frustration stemmed from a one-digit error in another person’s Social Security number. That led to a mistaken claim that his wife owed $80,000 to the IRS. On Feb. 28, Mackey told an agency worker in Bethlehem that he wanted to build a monument to the man who flew a plane into an IRS building in Texas last year.

FASB weighs ‘going concern’ self-test for US firms [Reuters]
U.S. accounting rulemakers are expected to revisit soon a 2008 proposal that would address the knotty issue of “going concern” warnings, seeking to better assure that alarms are sounded before companies fail. At issue are the standard warnings that auditors are required to include in annual reports when they have substantial doubt that a company will survive. With lucrative audit fees on the line, auditors have been accused of failing to flag going concern doubts, though some proposed changes could create new frictions between auditors and managers, some experts have said.

PwC Won’t Allow an Upset in Vault’s Prestige Rankings

Earlier this week, we learned that Grant Thornton was the new numero uno on Vault’s Accounting 50. The VA50 is determined by a number metrics that are weighted to come up with an overall score as to which firm is the best of the best. According to Vault, Grant Thornton was able to leverage their better work-life balance for employees to overcome their lack of prestige to pull this off.

For many people in the accounting world, however, this is meaningless. Reputation is everything and if you’re not working for one of the firms that are of highest regard, you’re simply a chump. Accordingly, Vault still presents a prestige ranking and while there aren’t many surprises, for many, this is the list. And the top firm on the list? P. Dubs.

1 (1) PwC
2 (3) Deloitte
3 (2) Ernst & Young
4 (4) KPMG
5 (5) Grant Thornton


6 (7) McGladrey
7 (6) BDO
8 (8) Moss Adams
9 (10) J.H. Cohn
10 (9) Plante & Moran
11 (13) Crowe Horwath
12 (12) Clifton Gunderson
13 (11) EisnerAmper
14 (22) LarsonAllen
15 (14) Rothstein Kass
16 (15) BKD
17 (18) Baker Tilly Virchow Krause
18 (16) Reznick Group
19 (21) Dixon Hughes Goodman
20 (19) Cherry Bekaert & Holland
21 (24) Anchin, Block & Anchin
22 (17) WeiserMazars
23 (23) CBIZ/Mayer Hoffman McCann
24 (29) ParenteBeard
25 (28) Wipfli
26 (31) Friedman
27 (27) Marcum
28 (34) Berdon
29 (35) Citrin Cooperman & Co.
30 (36) Eide Bailly
31 (26) UHY Advisors
32 (37) WithumSmith + Brown
33 (32) Elliot Davis
34 (38) Margolin, Winer & Evens
35 (33) Marks Paneth & Shron
36 (40) Blackman Kallick
37 (25) Novogradac & Company
38 (49) RubinBrown
39 (NR) Schonbraun McCann Group
40 (50) Kaufman, Rossin & Co.
41 (NR) Lattimore Black Morgan & Cain
42 (45) Frank Rimerman & Co.
42 (48) Habif, Arogeti & Wynne
43 (NR) Buff Pilger Mayer, Inc.
44 (NR) Horne
45 (NR) Rehmann
46 (NR) Schenck SC
46 (NR) Suby, Von Haden & Associates
46 (NR) Ehrhardt Keefe Steiner & Hottman
47 (41) Aronson & Company
48 (NR) SingerLewak
49 (47) SS&G Financial Services
50 (NR) Katz, Sapper & Miller

Oh! and probably most importantly, the prestige ranking is what we use to seed the brackets for the Coolest Accounting Firm in the spring, so it’s doubly important. Commence bickering.

AICPA Ballparking Future Releases of CPA Exam Scores

Over the past month, many of you anxiously anticipated the release of your CPA Exam score like Ralphie and his Red Ryder. The waiting part isn’t so unlike an eternity in hellfire and when NASBA finally does put the official Tweet, there’s no guarantee that your score will be included especially if you’re in one of those pesky non-NASBA states. It’s agony, really.

Because the AICPA feels your anguish (and frankly, they’re sick of the hysterics), they’ve announced a new score release timeline:

Starting in the fourth quarter of 2011 the U.S. CPA Exam will begin releasing scores earlier and more predictably. Initially this may not seem very interesting; however, the change will mark a major shift in the U.S. CPA Exam experience and the strategies that prospective CPAs employ as they work toward passing the exam.

The AICPA “initially” thought this wouldn’t be too interesting but when they took a microsecond to remember the post that Adrienne wrote a post back in March that garnered 162 comments, half of them bitching about this very topic and the other half accusing of AG of being a good-for-nothing shill for the AICPA/NASBA that’s never taken the exam, they realized that yeah, people would be interested to know when their scores are released.

ANYWAY, here’s the schedule:

Everyone can relax now. I’m sure scores will be out like clockwork going forward.

New Score Release Timeline for the CPA Exam [AICPA]

Accounting News Roundup: E&Y Has a Sour Outlook on Greece; Snoop Dogg Smokes Tax Lien; The iPad Debate | 09.29.11

The best way to tackle the Big Four [FT]
Michel Barnier has shocked the Big Four accounting firms. The European Union internal market commissioner wants to ban them from operating as consultants as well as auditors, force them to work jointly with others, and set time limits on how long they can audit each company. It could be the biggest shake-up of accounting since the collapse of Enron laid low Arthur Andersen and led to the 2002 Sarbanes-Oxley Act. Yet it will not amount to much unless the industry’s looming disaster – the failure of another audit firm and contraction to a Big Three – can be avoided.

E&Y Says Greek Defau [Bloomberg]
“The euro zone sovereign-debt crisis shows no sign of abating,” E&Y said in an e-mailed report in London [Wednesday]. “A default on Greek government debt now seems unavoidable. The key question is when this default will occur and how it will be managed.”

To Ease the Crisis, Tax Financial Transactions [NYT]
Governments, both rich and poor, urgently need a way to calm speculation in the financial markets and to raise revenue. On Wednesday, the European Commission president, José Manuel Barroso, proposed a tax on financial transactions. Such a measure, already supported by the German chancellor, Angela Merkel, and the French president, Nicolas Sarkozy, is long overdue. Indeed, a tax of just 0.05 percent levied on each stock, bond, derivative or currency transaction would be aimed at financial institutions’ casino-style trading, which helped precipitate the economic crisis. Because these markets are so vast, the tax could raise hundreds of billions of dollars a year globally for cash-strapped governments and could increase development aid.

D.C. tax employee’s arrest followed years of warnings [WaPo]
[F]ederal prosecutors charged a D.C. tax office employee with stealing about $414,000 from the city coffers. Mary Ayers-Zander did it, charging papers state, by making fraudulent manual adjustments to legitimate taxpayers’ income tax withholding, resulting in payments to personal accounts she had set up. In other words, Ayers-Zander found a weakness in the system and exploited it, finding a way to enrich herself because the internal controls within the Office of Tax and Revenue were not up to par, according to court records.

Snoop Dogg tax debt goes up in smoke [TW]
Robert Snell’s celeb tax scoop du jour.

Mr. Buffett’s Tax Secrets [WSJ]
[T]he opportunity to educate the public would be even greater if Mr. Buffett would let everyone else in on his secrets of tax avoidance by releasing his tax returns. Going only by Mr. Buffett’s unverified claims, his federal taxes in 2010 amounted to 17.4% of his taxable income, probably because much of his income was from capital gains and dividends. It’s also likely that he took significant deductions for charitable donations. No doubt the millions of Americans who could end up paying more because of this claim would love to see the details.


Medicis, its auditor will pay $18 mil to settle suit [Arizona Republic]
Medicis Pharmaceutical Corp. and its auditing firm, Ernst & Young, have agreed to pay $18 million to settle a shareholder class-action lawsuit stemming from the pharmaceutical company’s financial statements. Scottsdale-based Medicis would pay $11 million and Ernst & Young would pay $7 million under terms of a settlement agreement filed last week in U.S. District Court in Phoenix.

The iPad Decision [JofA]
Ask one CPA, the managing partner of a 160-employee firm, what he thinks of using the iPad in his work, and he tells you “there’s no other way to practice right now.” Ask another, the IT head of a 400-employee firm, and he tells you that his iPad is no more useful than a paperweight.