E&Y’s annual intern conference invaded Orlando yesterday and the ‘Berg had Director of Campus Recruiting, Dan Black on to discuss Gen Y and why they are pre-tay, pret-tay, pret-tay important to the future of the firm.
Despite their technology savviness, it appears that Gen Y is still relying on rock-paper-scissors as a key decision-making tool. Apparently, darts and jigsaw puzzles are important too.
Oh, and the time you put in as a line cook at Applebees’s in college really doesn’t translate into anything useful so don’t be too concerned about that.
We do have some specific details for assurance associates in New York and they don’t sound terrible:
NYC first year associate went from $55k to $64k, associate raises [are] coming in around 11-18%
So if you’re keeping score at home (and we know you are) it appears that the partner at E&Y who prognosticated that raises at his firm would beat PwC’s Raises appears to be right in some cases but perhaps not all.
Sooo, Ernie troops – are you happy? Disappointed? Suicidal? Ready to jump ship? Or calling your friends at PwC to brag how you’re keeping the pace? Discuss.
Last time we checked in on E&Y in the comp department, convos on promotions and ratings were to have gone down by last Friday. That appears to have happened right on cue and now we’re told that starting this week, the numbers will be coming down from 5 Times Square:
Latest regarding compensation (exact $ amount) in both FSO/New York and Northeast/New York regions is discussions should start today and run for 2 weeks. Big push right now in all business units to try and appear to care about people; people advisory board members have been reaching out for ways the firm can improve.
Feel free to speculate as to why the “caring” and “reaching out” is happening at this particular time of year (and if the Facebook downloading is at all related). Also, if you’ve had the talk and have great/disappointing news to report, do share or get in touch with us.
UPDATE: Word is that meetings are still being had this week and the numbers are still good. One source (Manager) in the assurance practice reported a 5 rating and a 21% bump. Not too shabby.
Good question! In case you didn’t hear, someone – his name is Ron Bowes – created a “crawler” (resident tech expert Nick told us it’s “a bot that has directives and algorithms based on known patterns in a webpage it ‘visits’ a webpage and pull information from selected places in that structure.”) that pulled data on 100 million Facebook profiles.
Since it only pulled the data that was publicly available, you could claim that this is NBD as Nick told us, “[A]ll the crawler did was collect it and put it into a single place, presumably in a format that is searchable and very ordered.”
And Engadget agrees, “There’s nothing illegal about any of this, of course — we put our information out there into the public forum that Facebook is, after all — but there’s still something creepy about the idea of someone torrenting our profile.”
What may be even more creepy is that lots of corporations – including E&Y – are downloading the data.
Nick told us that any corporation could have done this anyway but since someone else did, these companies figured, “why the hell not?” and downloaded the data. But E&Y? Maybe it’s just some back office guy stalking ex-girlfriends, as Gizmodo suggests, or Zitor collecting names for future abductions but it certainly makes you wonder.
So much so, we emailed E&Y spokesman Charlie Perkins to ask him about it (and if nothing else, we may have introduced him to a new website!) but we haven’t heard back and we don’t have our hopes up.
Unfortunately she doesn’t name names but use your imagination:
“We have investigations in the pipeline, across products, across institutions, coming out of the financial crisis,” SEC Chairman Mary Schapiro said after testifying before a House of Representatives subcommittee hearing.
Asked if the bulk of the cases have already been brought to light, she said: “Not necessarily, not necessarily.”
So it’s a grab bag really. Although, as you may recall, Dick Fuld is on the record that E&Y was on board with whatever the dorks in accounting were doing. Or maybe MS is just messing with Congress. The situation remains fluid.
I heard some scoop and wanted to share with my fellow indentured servants in the big 4 field. Word on the street is that P-dubs gave 10% raises to staff 2s becoming senior 1s (early promote) and 16% raises to staff 3s becoming senior 1s.
However, P-dubs doesn’t hand out the 5k bonus that Uncle Ernies offers to its staff 2s becoming senior 1s. I’d like to see how EY will top this, per an earlier promise from a partner that EY raises will be higher than P-dubs (maybe can some low performing partners?). In addition, the variance between average performers and high performers at P-dubs is only .6% (not significant at all).
So if this partner’s prognostication holds up, how will they pull it off down the stretch? Seems like a good question. Conversations are going on right now and the official news will reportedly be out in a couple weeks.
Since we’ve got half of the Big 4 involved here we’ll just mention that the belly aching at KPMG is in full force on the bonus front but maybe there’s hope for a strong move down the stretch?
As for Deloitte, apparently communication has occurred for promotions but it sounds like word on comp could be more than a month out. If you’ve got the scoop get in touch with the details and discuss this four horse race but as it stands right now, it looks as if PwC has E&Y by a nose.
Confirming some discussion in the comments from last Friday’s Ernst & Young compensation post, a source got in touch with us with more details on some rankings getting chopped:
I’ll confirm what your sources are saying about reviews being available in fso. Not only that, but forced rankings are in full effect. While [there] was less pushback during roundtables earlier (which was accurrate at the time), the ratings for at least 5 people were lowered by a notch from what was agreed to by the full committee at the end of may. (5 to 4, 4 to 3) While they do say after all people are discussed they’ll assess the levels to ensure the same criteria is being used, I firmly belive its being used as a way to lower ratings (and raises). Why have the formal review committees (roundtables) if the partners are going to have the ability to act unilateraly to ‘right size’ the ratings?
We’ll still have to wait a couple more weeks before we find out if the forced rankings actually translate into disappointing raises, as the official communication won’t come until August but this news surely doesn’t bode well. If you got knocked down a peg, discuss below and as always, keep us updated.
Straight out of the Bubba Gump Shrimp location up the street from 5 Times Square:
Ernst & Young, Financial Services Office, NY
Received communication that our annual ratings were finalized and discussions between counselors and counselees to occur by July 30. Promotions are still not final, but promotions and compensation will start to be communicated in August (to be effective October).
BUT! In case you need a refresher on the numbers so far: 3-5% is what we last heard for those in the meaty part of the curve. No word on what top performers are getting but speculation is welcome. Keep us updated.
The PCAOB has issued its annual report on Ernst & Young having given the firm the third degree at its national office and 30 of its 80 U.S. offices. It inspected 58 audits performed by the firm but exactly who is, of course, a big secret (unless you tell us).
There were five “Issuers” that were listed in the report and some form of the word “fail” was used 25 times (that includes the footnotes).
[Issuer A] The Firm failed to adequately test the issuer’s loan loss reserves related to certain loans held for investment. Specifically, the Firm failed to reconcile certain values used in the issuer’s models with industry data, failed to test the recovery rates used in the issuer failed to test the qualitative components of the reserves.
Damn those loan loss reserves!
[Issuer C] The Firm failed to perform sufficient procedures to test the issuer’s allowance for loan losses (“ALL”). The issuer determined the general portion of its ALL estimate, which represented a significant portion of the ALL, using certain factors such as loan grades. Data for this calculation were obtained from information technology systems that reside at a third-party service organization. The Firm relied on these systems, but it failed to test the information-technology general controls (“ITGCs”) over certain of these systems, and it failed to test certain of the application controls over these systems. Further, the Firm’s testing of the controls over the assignment and monitoring of loan grades was insufficient, as the Firm failed to assess the competence of the individuals performing the control on which it relied.
This loan thing appears to be a trend…
[Issuer D] The Firm failed to sufficiently test the costing of work-in-process and finished goods inventory. Specifically, the Firm’s tests of controls over the costing of such inventory were limited to verifying that management reviewed and approved the cost allocation factors, without evaluating the review process that provided the basis for management’s approval.
Hopefully that doesn’t blow back on an A1.
Anyway, you get the picture. The whole report is below for your reading pleasure. E&Y’s got its $0.02 in, however it was short and was mostly concerned about the firm’s right to keep its response to Part II (the non-public part)…non-public:
We are enclosing our response letter to the Public Company Accounting Oversight Board regarding Part I of the draft Report on 2009 Inspection of Ernst & Young LLP (the “Report”). We also are enclosing our initial response to Part II of the draft Report.
We note that Section 104(g)(2) of the Sarbanes-Oxley Act requires that “no portions of the inspection report that deal with criticisms of or potential defects in the quality control systems of the firm under inspection shall be made public if those criticisms or defects are addressed by the firm, to the satisfaction of the Board, not later than 12 months after the date of the inspection report.” Based on this statutory provision, we understand that our comments on Part ii will be kept non-public as long as Part ii of the Report itself is non-public.
In addition, we are requesting confidential treatment of this transmittal letter.
So this doesn’t mean much other than E&Y would prefer that no one know how it managed to tell the PCAOB to fuck right off as nicely as it could.
Evergreen Energy of Denver dismissed Deloitte effective June 23rd according to the company’s 8-K filing. Hein & Associates, a local Denver firm, will take it from here.
It stands to reason that Evergreen didn’t appreciate the going concern opinions that Deloitte gave the company for its December 31, 2009 and December 31, 2008 financial statements but in cordial SEC filing fashion, there are no parting shots from the company.
Evergreen’s press release indicates that this was simply an opportunity to throw some action to another firm (most likely with lower fees), “With the sale of certain Buckeye assets and our exit from the coal mining industry, Evergreen Energy has transitioned into a green technology company. This is an ideal time to switch to a Denver-based regional accounting firm with substantial public company expertise in the clean technology and software industries that can more cost effectively meet our needs.”
Deloitte’s letter to the SEC is abruptly admits that everything is cool rather than flat out saying, “you’ll be sorry you ever ditched us, you losers.”
Similarly, Measurement Specialties, Inc. showed KPMG the door for Ernst & Young. The company says everything was hunky-dory between the two although there was a small matter of the internal controls around a significant joint venture of which the company had no control. Oh, and the effectiveness of internal controls of some recent acquisitions also couldn’t be determined. But it was cool and the company said, “it was in the best interests of the Company to change its independent registered public accounting firm.”
KPMG has NFI what that means saying in their letter, “we are not in a position to agree or disagree with Measurement Specialties, Inc.’s statements relating to the reason for changing principal accountants.”
For starters, why do you need an actor to “demonstrate what not to do in the workplace”? Couldn’t they just secretly film employees on any old regular Thursday and get the footage they need? Then you could do a candid camera type ending where Jim Turley jumps out and cans their asses.
As far as casting is concerned, David Hasselhoff immediately comes to mind but in the off-chance that the Hoff isn’t available, who picks up this gig? We imagine an in-house choice would be preferable in order to save on costs.
Evergreen Energy of Denver dismissed Deloitte effective June 23rd according to the company’s 
