Author: Caleb Newquist

Founding editor, Going Concern.

Jim Quigley Would Really Like It if the Big 4 Could Audit in India

Deloitte is hiring about 3,000 people in India as part of their hiring bonanza and global CEO Jim Quigley dug into his bag of boilerplate statements to express his excitement:

“India is an extremely important market for Deloitte. As…Opportunities in the new economic environment emerge in India, Deloitte with its focus on hiring, developing, and deploying the best talent in the region, will help clients capitalise on these new market initiatives,” Deloitte Global CEO Jim Quigley told reporters here.

Right. So nothing new there. However, Quigs thinks that it’d be really swell if TPTB in India would change their mind about letting the Big 4 provide audit services there:

Quigley also made a case for India to open up its market and allow global audit firms to practice here, besides providing consulting and advisory assistance.

Allowing international accounting firms to practice here would require India to negotiate and allow the service to be accessed under the World Trade Organisation (WTO). At present, India has not opened up services like audit and law for foreign practitioners.

“I urge the Indian authorities to give a serious thought to allowing global audit firms to practice here. It is for the betterment of accounting professionals. A mutual recognition is required out of foreign direct investment,” Quigley said.

See? It’s not just about the biggest firm in the known universe getting bigger, it’s for the betterment for the entire accounting race. There’s so much fun to be had. The Satyams of the world are once in a blue moon.

The Queen Would Like to Know the Staffing Situation for KPMG’s Banking Clients

If you’re a student of Kylnveldian history – and we know that you are – the fact that KPMG has been auditing the Royal Household’s accounts since before Liz was born doesn’t surprise you. For those of us that weren’t aware of this KPMG fun fact, this is just adds a little more to the blue square mysitque.

Anyway, being the classy gal that she is, Her Majesty showed up last Friday to help mark the opening of the new KPMG building in Canary Wharf. And not only was she thrilled to be there, she surprised KPMG leadership with her affability and interest in the work that non-royals do:

John Griffith Jones said: “She genuinely seemed interested in what we do, especially our charity work and the building’s green credentials. She made a funny comment about Crossrail being delayed and also asked about our role during the crisis.”

Senior partner Eddie Donaldson said the firm was in a “unique position” independently auditing the royal accounts which use public and private money. “The team already see it as a privilege to work on the accounts in the first place and then to meet the Queen was a very special moment in their careers.”

And because she’s concerned about the serious issues out there, Jones was also quoted, “she was very interested to know how many people we had working on the banks.”

The possibility that Queen Elizabeth probably knows more about KPMG than Dick Bové should not be lost on anyone.

Going Concern Reader Survey (Fall 2010)

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I’ve been assured that your answers will only be used for the forces good and that it won’t take up too much of your time.

As a show of our undying appreciation, we are offering you the chance to win a $500 gift card which could come in handy with the holidays coming up and whatnot.

Kindly follow this link to take our survey. Your time and participation are appreciated.

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IRS Unit Fully Intends to Make Rich People’s Audit Experience as Unpleasant as Possible

As you my have heard, being mega-rich these days has its disadvantages, including but not limited to – 1) governments getting overly reliant on the wealthy pitching in with revenues; 2) people giving you a hard time when you buy new toys; 3) your own kind selling you out.

Because times are tough and elected officials are having difficulty convincing anyone that higher taxes for the middle class are a good idea, the affluent are having the unfortunate luck to experience the rigor of the Global High Wealth Industry Group – a new unit within the IRS designed to perform the financial equivalent of a full rectal exam:

The reviews performed so far have been particularly harsh, say attorneys. Investors are being asked to turn over numerous hard-to-get documents in short order. These are “the audits from hell that your grandfather warned you about,” says Charles P. Rettig, a partner at Hochman, Salkin, Rettig, Toscher & Perez in Beverly Hills, Calif.

And don’t think for a second that the Service is putting scrubs on these assignments. Extra-special auditees deserve extra-special auditors:

Miriam L. Fisher, a tax attorney and partner at law firm Morgan Lewis in Washington, says the audit teams comprise “A-list examiners” drawn from around the country who are knowledgeable and experienced with various financial products and industries. The audits are so intensive that each team is handling only a few right now and they aren’t far along in the process, she says.

IRS spokeswoman Michelle Eldridge says the group is looking at “individuals who have a complex set of situations, and looking at the complete financial set up.” She acknowledged that “these cases are full audits.”

Although you would never expect an IRS audit to be as delightful as, say, your average weekend in the Hamptons but haven’t rich people suffered enough? The least the IRS examiners could do is bring something from Maison du Chocolat to bring the tension down a notch.

[via TaxProf]

Do I Have Public Accounting Burnout?

Good morning and welcome back as we return with another accounting career quagmire. In today’s edition, an experienced associate at a California regional has a bad case of burnout and is weighing some options – including the IRS.

Caught in a dicey situation at work? Want to incorporate your love for your firm on your vanity plates but need some suggestions? Have some extra money to throw around and need help with ideas on how to best use it to your advantage? Email us at advice@goingconcl make sure you spend it wisely.

Back to the burnout at hand:

I am a second-year associate at a regional firm in California and I am considering getting out to go somewhere else, but I’m not sure where. I’ll start by saying that I have some big issues with the way the firm is run and I don’t trust anyone except for people in my office and maybe two people in the main office. Multiple people in my office have recently notified the firm that they will be leaving including multiple staff, a manager, senior manager, and a partner. Most of them are leaving due to the frustration related to the way things run around here. The partner and managers were basically rendered powerless by the CEO and main office for the entire time they were here and I think the growth of our office has suffered because of it.

I don’t have my CPA license and I’m not sure I care about it anymore, but then again, I’m not sure if working here has just beat me down to the point where I am pessimistic about the rest of my life spent in accounting. I do somewhat enjoy auditing, but I feel I would be better suited for forensics or consulting, a path that I inquired about at my current firm to which I received a reply similar to “not if you want to keep your job”. Could the grass be greener at another accounting firm? I had a good amount of personal interaction with the partner, but I am not sure it’s enough where I could ask him if he wants to bring me along when he jumps ship and swims to his new firm. Or should I be looking for a larger, more well-established firm with more interesting clients?

That being said, I’m pretty burnt-out and not even sure if I want to stay in public accounting. I don’t want to go private at this point, but might instead want to go work for the IRS. My brother is a revenue agent, enjoys it, and said he’d keep his ears open for job opportunities. It seems like it is less frustrating, fairly interesting work that fits into my more investigative mind-set. So could the better hours, more centrally located audit locations, great benefits, and lot’s o’ federal holidays be worth making the switch?

Thanks for your help,

Big-Time Burnout

Dear BTB,

Autocratic management? A quasi-exodus? Your professional interests are meaningless? How you’ve managed to last two years in this joint is nothing short of miraculous. How the firm convinced you to take the job in the first place is also a mystery but let’s focus on the future shall we?

From the sounds of it, you are suffering from a severe case of burnout but we’re not convinced that it’s because of public accounting. You ask, “Could the grass be greener at another accounting firm?” and considering the fact that grass you’re currently grazing is brown and the dog shit hasn’t been picked up for weeks, it wouldn’t be hard to find a better firm. The risk is that if you do have public accounting burnout then you’re doing yourself a disservice by making another run at it when your heart isn’t in it. Plus, your “meh” attitude about the CPA doesn’t do much for your prospects at another firm.

If you’re interested in forensics and consulting, the IRS may be a good route for you. Follow up on your lead and make it known that you are very interested in any opportunities. But since the IRS gig doesn’t sound like a guarantee, you should find a recruiter to help you get out of your current gig. Don’t make yourself look like you’re desperate but definitely communicate why you are looking. A good recruiter will help you find a cultural fit as well possibilities to satisfy your intellectual curiosities.

So while you’re showing severe symptoms of public accounting burnout, it’s not a clear-cut case. Your career aspirations would be best served if you could find another firm more willing to cater to your interests in forensics and consulting. If an opportunity at the IRS comes up and you’re still interested, go for it. In the meantime, take some vacation (if your firm will let you, yeesh).

Insight from the peanut gallery? Help the poor guy out.

Accounting News Roundup: Rangel’s Hearing Begins; Looking at the Odds on Tax Cuts; Baucus to Introduce Repeal of 1099 Requirement | 11.15.10

White House: No Permanent Tax Cut on Rich [WSJ]
Senior White House adviser David Axelrod said Sunday the president wouldn’t support a permanent extension of tax cuts for wealthy Americans but declined to say whether the White House would support a temporary extension.

Mr. Axelrod also reaffirmed President Barack Obama’s commitment to securing an extension of tax cuts for the middle class, saying this group of Americans has “taken a terrible beating.”

After several days in which U.S. lawmakers have attempted to gauge the White House’s willingness to compromise on tax-cut extensions, Mr. Axelrod said on NBC’s “Meet The Press” that there would be “no bend” on the president’s opposition to permanent cuts for couples making more than $250,000 a year and individuals making more than $200,000.

Rangel’s Hearing Set to Begin, but Details Are Few [NYT]
After two years of investigations and political recriminations, Mr. Rangel is scheduled to appear before a hearing of the House ethics committee on Monday to formally rebut charges that his fund-raising and personal finances violated Congressional rules.

Congress holds public ethics hearings so rarely — the last was in 2002 for Representative James A. Traficant, an Ohio Democrat who had been convicted of criminal charges — that the proceedings will open amid an air of novelty and uncertainty. Neither committee investigators nor Mr. Rangel will discuss who or how many people are on their witness lists, so it is unclear whether the case will end quickly or drag on for days.

What Are the Odds of an Obama Compromise on Bush Rates? [Tax Update Blog]
It’s not Vegas but this should help you get a feel for what the tax rates will be next year.

Accounting for Grant Thornton’s Accountants [China RealTime Report/WSJ]
The Journal takes another stab at the BDO/Grant Thornton jumble in Hong Kong and appears to have straightened things out.

Baucus will introduce legislation to repeal 1099 requirement [On the Money/The Hill]
Senate Finance Committee Chairman Max Baucus (D-Mont.) said Friday that he intends to introduce legislation to repeal requirements that businesses file 1099 forms for purchases of $600 or more made from suppliers.

“I have heard small businesses loud and clear, and I am responding to their concerns,” Baucus said in a statement.

Nancy Pelosi Will Have You Know That She Wasn’t Responsible for the New 1099 Requirement Sneaking into Healthcare Reform

“One item that I think we all agree on that was in the Senate bill, not in the House bill, but became part of the law was 1099, which affects small businesses and small contractors and how they report their transactions. They know what it means, and they know they’d like to see it go. I think that’s probably the first place we could go together.”

~ The soon-to-be former Speaker of the House is willing to talk about this one.

Clifton Gunderson Plays Hardball with KPMG, Other Audit Firms By Pitching a Low Ball

Meanwhile, back in the world of where people actually do work – a friend of GC sent us the following:

I heard an amazing price war story from a very reputable source. Thought you would enjoy.

A KPMG audit client in the Virginia Beach area went out to bid. KPMG bid approx $85K, a regional firm bid mid-60K, another firm approximately 40K, and Clifton Gunderson undercut everyone by bidding $19K on the audit. 19K! How in the hell is that possible? This is a prime example of what is happening out there.

Don’t know if this is SOP at Clifton but that price has to make for some horrendous realization or it’s simply staffed by an entry-level associate and a partner. Other theories on how they plan to pull this off without completely losing their shirts are welcome.

Grant Thornton Employees in Chicago Feeling the Heat to Join Big 4

After reporting rumors that PwC was chasing Deloitte seniors in Chicago, now comes another report out of the House of Chipman:

Is it just me or is pwc trying really hard to bring in seniors in Chicago? The other day at GT, the same pwc recruiter called every S1 in audit asking if we’d be interested in moving over.

A few of us actually answered just to see what he had to say and he was pushing real hard in getting people to accept that if we made a move, we’d have to take a step down (S1 to move over to A3), and that they’d be making a large investment in keeping us long-term (at least through a promotion to manager). This is after we lost a S2 and an A2 who both moved to pwc. Plus, we’ve received several emails from other outside recruiters gauging our interest in the Big 4, not to mention my friends at the Big 4 trying to get me to send them my resume so they can refer me (for a much larger referral bonus, I’m assume). Not sure if this is juicy enough information, but that’s pretty much what’s happening right now over at G to the T.

Here’s the deal people – all the firms need people at the Senior Associate level. All the firms have made it known that they are hiring aggressively, both experienced and entry-level employees and the recruiters within the firms have jobs too. Besides, where are they supposed to look for the appropriate talent to fill their empty positions? Dunkin’ Donuts?

Grant Thornton, believe or not, has plenty of talented people and the Big 4 will take those people if they can get them. Management probably gets tired of all the bellyaching by employees about how short-staffed they are so the pressure is on the recruiters to get asses in the seats.

If you don’t want to be hassled by Big 4 recruiters, simply say, “I’m not interested, thanks,” and go on your merry way. But judging by all the complaining at GT, lots of employees are probably happy to entertain some options.