This could be what PwC’s Talent Leader was talking about she said that poaching, “[Has] always been a place we like to stay competitive.”
Mr. Henry, a tax partner who has spent more than 25 years in public accounting, most recently at KPMG, has extensive experience in all areas of state and local taxation. He is best known for his work in the credits and incentives space, both domestically and worldwide. His experience in maximizing global incentives for large multinational corporations in the United States, Europe, Asia and Africa will enable both US-based and non-US-based multinational companies to benefit from his counsel when entering into economic incentives negotiations.
Welcome to the where-the-hell-is-Bahrain? edition of Accounting Career Emergencies. In today’s edition, a future E&Y tax associate wants the lowdown on the black and yellow ladder. How high are these rungs, anyway?
I will be starting in the tax dept of a Big Four soon.
How long would it take to move up the tax ladder? (Yes, yes I know your response will be to start first before I start thinking about promotions… But I am thinking ahead…)
What is the minimum number of years typically required at each level? Are exceptions ever made? What goes into promotion decisions? How long would it take to get to the partner/director level? Is the promotion criteria generally standard across all Big Four or is there some variation?
Thanks,
Ms. Thinking Ahead
Dear Ms TA,
You’re quite the eager….errr, go-getter aren’t you? That’s good, I like my accountants ambitious. We’re not intimately familiar with the ladder at E&Y but we’ll give it a go and let the bean gallery fill in the gaps.
Typically, you can expect to be an associate two to three years before being promoted to senior. Depending on the needs of your practice group and your performance, this could be shorter or longer. In order to get the bump to manager, you can expect another three years at a minimum, again, subject to the needs of your group and whether or not you’re impressing the pants off the brass. From there, you can expect at least two years at manager, another two to three as a senior manager and then, if you’re lucky and you have a good business case, TPTB might start looking at your for admittance to the partnership. Altogether, you’re looking at a bare minimum of nine years before you can even get a whiff of partner and twelve to fifteen is probably a more realistic time frame. There are exceptions of course but that’s more or less the timeline.
Because tax doesn’t have the same fee pressure as their audit counterparts the wait might not be as long but don’t forget, not just anyone gets into the partnership. You need to be a performer and be able to win new clients. The benefit of tax is that it has more diverse career paths available, so if you find discover that you’re a wizard at transfer pricing or M&A, you might see a quicker ascension.
This presupposes the fact that you obtain your CPA in a timely fashion as most tax practices will not promote you to manager without a CPA, a JD or EA. How about it black and yellow tax troops? Dispel with the gory details as necessary.
AS PREDICTED! Republican Congressman Todd Akin of Missouri could barely wait 48 hours before falsely asserting that the new 5,000 employees at the IRS will all be agents that will be breaking down the doors of every freedom loving American to fleece them for every last dime.
The back-and-forth began after Akin questioned Geithner about President Obama’s fiscal 2012 budget, which includes spending increases for the IRS that could reportedly lead to thousands of more staffers at the agency. The Missouri congressman said he thought energy might be better spent simplifying the tax code. “Not to mention the fact that it’d make us all look better if we don’t have a goon squad of 5,000 IRS agents tromping around the country with the economy the way it is,” Akin said.
Right. Because you looking good is what’s most important, right Congressman? Geithner, not really impressed with a two-bit fly-over representative giving people in his house shit, tried explaining to him that most of the new employees would work in “customer service or information technology [rather] than enforcement” but this fell on deaf ears:
[T]hat argument did not assuage Akin very much. “’I’m from the IRS. I’m here to help you,’” the congressman said. “That’s hard to sell in the state of Missouri.”
Akin probably didn’t think to ask the employees of the nine IRS locations in Missouri about this. Maybe some of them would be able to explain how, you know, working for the IRS is how they put food on the table, put clothes on their kids, etc. etc. etc. You know, the rhetoric you like to use, Congressman.
Hey gang, the ad folks who run this laugh factory have asked that you take this short survey. I’ve been assured that it’s harmless, so kindly oblige them and we’ll never have to speak about it again.
Supposedly there are some fantastic swag in it for a few lucky few of you, so make haste.
We now return to your regularly scheduled inflammatory nonsense.
SEC, CFTC and IRS Make Case for Thousands of Hires in 2012 [FINS]
The documents submitted to Congress by the SEC, CFTC and IRS explain the ways in which they’ll use funds that were proposed in the Obama administration’s budget. Collectively, the agencies plan on increasing headcount by just over 6,200 in 2012 and their budgets by $1.5 billion to ensure investment firms are in compliance with new regulations, oversee the derivatives market and curtail tax evasion, among other things. The hiring plans are contingent upon Congress passing the budget.
Ex-Freddie Mac C.F.O. May Face Civil Charges [DealBook]
Anthony Piszel, known as Buddy, who was Freddie Mac’s chief financial officer from 2006 to 2008, received a so-called Wells notice from the Securities and Exchange Commission, an indication that the agency was considering an enforcement action against him.
State-by-State Ranking of Prisoner Tax Fraud [TaxProf Blog]
Florida ran away with it – $12.6 million, $9 million more than second-place Georgia.
Accounting firm could help D.C. schools find savings, new money sources [WaPo]
The city spends more than $1 billion a year on K-12 education – $750 million for 123 public schools and $400 million for 52 public charter schools – by far its biggest ticket item. Gray said in a brief interview that Deloitte, which will do the analysis on a pro bono basis, will look for “savings to be had and money to be found.”
Panamericano Accounting Loss Hits 4.3 Billion Reais [Bloomberg]
Banco Panamericano SA, the Brazilian lender under investigation for alleged fraud, said its loss from “significant accounting distortions” reached 4.3 billion reais ($2.6 billion), exceeding its initial 2.5 billion-real estimate.
Eleven cool mobile apps for running your practice [AW]
Dirty Birds isn’t one of them.
A radical thought about governance [IIA]
Some ‘What ifs’ from Norman Marks.
If you recall, Hector Sanchez swiped $40k from his church to spend in “casinos and restaurants” which is arguably the lamest thing you could do with forty large of a God’s money. What about spending it on a facial to soften that nice bone structure? Yeesh.
Auditor musical chairs isn’t something that happens too often but Reuters reports that more and more U.S. companies are looking to save a little extra scratch on their audit fees:
Bucking a long-standing preference by most companies to stick with the same auditor for years, some companies are putting their audit work out for competitive bids to win better deals on fees, or to get fresh teams looking at their books. “It’s a change in the competitive landscape among the audit firms where they have the ability and desire to take on more clients,” said Mark Grothe, an analyst at consulting firm Glass Lewis. Public companies also seem to be more willing to switch auditors, as long as one of the “Big Four” firms will be doing the work, he said.
The article cites Apple (dropped KPMG for E&Y) and Tysons (kicked E&Y to the curb in favor of PwC) as two prominent examples. We’re also aware that Credit Suisse is slowly transitioning a good portion of the audits performed by KPMG to PwC, according to sources familiar with the situation. Companies of this size willing to change their auditors demonstrates that some companies aren’t too concerned with the learning curve that may face their new auditors. In fact, some CFOs are more than okay with it, including Linster Fox of Shuffle Master who claims, “There’s no degradation in service — the service is actually higher.”
PwC’s Tim Ryan, however, doesn’t buy the idea that fees are the driving force behind the auditor switcheroo, “When a company does go through a change, it is almost always driven by something other than fees,” he told Reuters. Instead, a change is more likely to happen when, for example, a major fraud gets missed or there’s a difference of opinion on a crucial issue OR the CEO is a finicky characterOR some other mysterious reason unbeknownst to all of us.
Regardless, the real concern is that all this auditor swapping puts a lot of pressure on fees:
Fee pressure has been intense worldwide, but especially in the United States, according to the International Accounting Bulletin, which tracks global audit fees. “The U.S. is a very competitive market, easily the largest audit market in the world, and the Big Four have competition from a much larger pool of firms,” said IAB editor Arvind Hickman. “Last year we received reports of fees being cut between 5 and 15 percent on average on audit work, and there were extreme cases where fees were being cut up to 40 percent,” he said. Fee pressure appears to be easing somewhat, “but there will still be fee pressure this year and we don’t predict it will go away any time soon,” he said.
Taxes are a touchy subject with Americans. This is known. On the one hand, a Tennessee CPA combined his love for 1040s and firearms, issues coupons to clients who, in their jubilation, can spend their refunds at his gun shop. Even if someone were not due a refund, it wouldn’t be tough to convince someone in small-town Tennessee that purchasing a gun is bound to make you feel better about the IRS impending on your freedom. For others, finding out that their sophisticated tax planning didn’t go as intended, may just cause them to grab the nearest bottle of hooch and try to forget their troubles for awhile.
Thanks to Kay Bell, we have learned that one liquor store in Delaware has made this latter scenario more convenient for its customers:
Because we were curious to know more, we called up Steve’s to find out the situation. We spoke to someone who said that returns start at $65 but the lady in charge was out and could call us back with the details. We’ll have the lowdown for you when we hear back from her.
UPDATE: We just got off the phone with Yvette Nidwik, who does the tax prep over at Steve’s and she shared with us a few more details. Unfortunately, the answer to the question on everyone’s mind, “Do we get a discount on booze?” is a flat “No.” Apparently it’s illegal in Delaware law to give discounts on liquor associated with another service (or something). Be that as it may, we were surprised when Yvette told us that she has a lot of “church people” as clients despite the proximity to the Devil’s brew. Yvette has been preparing tax returns for eleven years, five of those at Steve’s. She is not a CPA but plans on becoming an Enrolled Agent soon. She also doesn’t have a problem with the IRS’s forthcoming preparer regulations, saying, “it’s a good thing,” and that she’s “a fixer” meaning she has lots of clients who come in with prior year returns and she find lots of mistakes (especially from discount preparers that will remain nameless).
So if you’re in the area and don’t have the time or willingness to do your own, look Yvette up at Steve’s but she’s a busy lady, so no messin’ about and she’d probably prefer if you stopped in the liquor store after speaking with her.
Last week, we told you about Wells Fargo’s announcement that their CFO gave himself an early birthday gift by throwing a retirement party for himself. As previously mentioned, Howard Atkins’s departure was a little mysterio and no one had any theories (crackpot or otherwise) on the Atkins’s march in. That all changed yesterday when Christopher Whalen, an analyst at Institutional Risk Analytics issued a report that stated that he, for one, wasn’t buying the “personal issues” story put out by the bank:
“The departure of Atkins, we are led to believe, was not merely the result of personal issues, but reflects an ongoing internal dispute within [Wells Fargo’s] executive suite regarding the bank’s disclosure,” he writes.
Whalen then goes on to argue that Wells Fargo’s “public behavior suggests significant problems in the bank’s internal systems and controls as defined by the Sarbanes-Oxley law. We further understand that some officials of [Wells Fargo], increasingly uncomfortable with the bank’s aggressive public disclosure regime, have reached out to regulators because of concerns regarding accounting issues.”
The Stagecoach Gang, for their part, is sticking to their story citing the “personal reasons” and their spokesman dismissed Whalen’s report with “pfffft” and a wave of the hand, saying, “I haven’t heard anything like that. It’s speculation. I’m not going to comment on it.”
[A]ccording to a report by PriceWaterhouseCoopers (PwC), those lessons don’t relate well to a generation of broadband mobile users who still prefer to go searching for free content rather than pay even the smallest price.
“Many consumers who say they commit online piracy are enticed by free content” despite having access to “an astonishing variety of movies videos and television shows–on multiple platforms–faster than ever before,” the report concludes.
The report’s key findings are topped by the fact that 81 percent of surveyed consumers say they will continue pirating video despite concerns about computer viruses, the legality of their actions and inferior quality/fidelity of the content. It also reported a crossover effect in that “40 percent of those who report pirating content via traditional methods said they will probably also pirate on mobile devices within the next six months.”
From Prison, Madoff Says Banks ‘Had to Know’ of Fraud [NYT]
In many ways, however, Mr. Madoff seemed unchanged. He spoke with great intensity and fluency about his dealings with various banks and hedge funds, pointing to their “willful blindness” and their failure to examine discrepancies between his regulatory filings and other information available to them. “They had to know,” Mr. Madoff said. “But the attitude was sort of, ‘If you’re doing something wrong, we don’t want to know.’ ”
Why It’s Worth Paying for a Tax Pro [WSJ]
To save money last year, Anthony Fasano tried preparing his new business’s first tax return on his own. Then reality sank in. “I realized I really had no understanding of the tax laws from a business standpoint,” says Mr. Fasano, founder of Powerful Purpose Associates, an executive-coaching company he runs out of his home in Ridgewood, N.J. “I was just winging it.”
Nonprofits and International Financial Reporting Standards [AW]
Anyone who has looked at a nonprofit financial statement over the past two years might recognize the term “Fair Value Measurements” in the footnotes. This is just one example of how a joint project between the FASB and IASB has affected the reporting of U.S. nonprofit organizations. On an ongoing basis, U.S. nonprofits can expect to see changes in U.S. GAAP that will impact their reporting requirements for years to come.
Replace the Big Four with Audits by Government? More Heat in the Kitchen — and Less Light [Re:Balance]
An excellent column from Jim Peterson although I feel like he missed an opportunity to include a cockroaches metaphor.
Should Faculty be Required to Fill Out Time Sheets? [TaxProf Blog]
The billable hour goes to school.
Is Your Employee’s Cell Phone a Security Breach Waiting to Happen? [CPA Trendlines]
Not to mention the sexting!
A Question for the CFO of Green Mountain Coffee Roasters [White Collar Fraud]
Sam Antar is puzzled: “How was Green Mountain Coffee Roasters able to report income before taxes in its Timothy’s Coffee of the World Inc. subsidiary that exceeded revenues in the thirteen-weeks ended June 26, 2010?”
Trump and the Mets? Anything Is Possible [NYT]
Or running for President. Whichever.
Cheating IRS nets inmates $39 million [DFP]
Crime Pays!
~ Update below with link to audio of the proceedings
Last month we caught you up on Campbell v. PricewaterhouseCoopers, the wage and hour lawsuit filed by employees of the firm, claiming to be non-exempt and thus available for overtime. Oral arguments were heard today at the 9th Circuit Court of Appeals in San Francisco and it marks the most recent step in a case that could have wide repercussions in California. Francine McKenna has a good rundown over at Forbes, including sta��������������������rshaw, the plaintiffs’ attorney. PwC and their lead counsel, Dan Thomasch of Orrick, have declined to comment at this time.
In today’s proceedings, both sides were allowed to make their arguments and answered questions from a three-judge panel. We’ve obtained the briefs for both sides and we’ll give you a taste of each. First, from the plaintiffs:
PwC argues that Attest Associates satisfy the Professional Exemption because—notwithstanding the routine and nondiscretionary nature of their work—PwC claims that they are functionally indistinguishable from fully licensed accountants, doctors, lawyers, and engineers. As a matter of law, however, the text, structure, and drafting history of the Professional Exemption limit its application to licensed accountants, and Associates are not licensed. Second, PwC argues that Attest Associates satisfy the Wage Order’s Administrative Exemption because they work “under only general supervision” despite up to six layers of managers who are responsible for Associates’ work. That argument fails, however, because PwC has not pointed to sufficient evidence to create a triable issue of fact that Associates “work along specialized or technical lines”—much less that they do so “under only general supervision”—as required by the Administrative Exemption.
The argument goes into detail from there addressing three key arguments: 1) The Professional Exemption Does Not Apply to Attest Associates; 2) The Administrative Exemption Does Not Apply to Attest Associates; 3) The Rules Governing Professions Other Than Accounting Do Not Help PwC. You can see the brief in its entirety on the next pages.
PwC addresses all three arguments in their brief; this is a portion from the brief’s introduction:
Put simply, nothing in the Wage Order precludes unlicensed accountants from being shown to be exempt under subsection (b) of the Professional Exemption. Plaintiffs’ argument that the “drafting history” of the wage order at issue shows an intention on the part of the [Industrial Welfare Commission] to prohibit unlicensed accountants from being professionally exempt should be rejected, because the language and structure of the Professional Exemption are not ambiguous, and contain no such prohibition. Even the District Court did not accept Plaintiffs’ tortured reading of the text of the Professional Exemption, or claim to find unambiguous intent on the part of the [Industrial Welfare Commission] to exclude from eligibility for the Professional Exemption all unlicensed members of the accounting profession — and inevitably by extension, all unlicensed lawyers, doctors, dentists, optometrists, architects, engineers, and teachers. Doing so is flatly contrary to the overriding principle governing application of exemptions from overtime provisions, which is to consider individual employees’ work duties.
And their brief outlines a direct counter to the plaintiffs’ brief: 1) Plaintiffs’ Argument That Accountants Can Only Qualify for a Professional Exemption Under Subsection (a) Is Unsupportable 2) PwC Is Entitled to Show That Its Attest Associates Satisfy the “General Supervision” Requirement of the Administrative Exemption; 3) The Impact of the District Court’s Order Is Not Limited to the Profession of Accounting.
So what we’ve got here is…failure to agree on how the ambiguous (or not) California law is and how it applies specifically to unlicensed audit associates. Are they really just cogs in the wheel, bowing to their superiors as the plaintiffs argue? Or are they responsible professionals who are engaged in a challenging occupation that warrants exemption? The 9th Circuit will have transcripts and audio from the proceedings available on its website at some point tomorrow and we’ll update this post with them when they’re available. As for a resolution, it will be several months before we find out what the 9th Circuit rules and then, there’s still a trial to be had. Stay tuned.
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Hey gang, the ad folks who run this laugh factory have asked that you take this 
SEC, CFTC and IRS Make Case for Thousands of Hires in 2012 [
