Category: EY

(UPDATE) Ernst & Young Partner Sentenced to Prison for Role in Tax Shelter Scheme

prison.jpgIn accountants going to jail news, E&Y partner Robert Coplan was sentenced to three years in prison for his role in creating tax shelters for wealthy clients from 1998 to 2006.
In addition to the jumpsuit (denim?), Mr. Coplan was ordered to pay a $75,000 fine and peform 120 hours of community service, half of which must be counseling of tax professionals about his time as a scofflaw.


Judge Sidney Stein said that while Mr. Coplan was an otherwise all right guy, the sentence was for ‘general deterrence’ and that he understood that ‘there was pressure coming from higher-ups at Ernst & Young’.
Judge Stein is scheduled to hand out more prison time to former E&Y partner Martin Nissenbaum today, while former partners Richard Shapiro and Brian Vaughn tomorrow.
Presumably all the men have access to a toilet without too much hassle.
UPDATE, Friday 8 am: Martin Nissenbaum was sentenced to two-and-a-half years. Not sure why he got 6 months less than Coplan but we’re sure he’s thrilled with the outcome.
E&Y partner gets prison over tax shelter scheme [Reuters]

The Fortune 100 Best Companies to Work For: Ernst & Young #44

The always über-hyped Fortune 100 Best Companies to Work For is out and a handful of accounting firms make an appearance, thus, extending the number of years that firms will continue to boast about their inclusion. We’ll present each in the order they are ranked for your enjoyment/debate/debunking, starting with E&Y.

Ernst & Young #44 – Previously ranked #51. According to Fortune E&Y is great because, “E&Y is the only one of the Big Four to offer a traditional pension in addition to a 401(k). The firm is courting alumni via a new magazine, Connect.”


Other interesting stats per the snapshot:

• New Jobs (1 year): -1,111;

• % Job Growth (1 year): -4%;

• % Voluntary Turnover: 10%

• No. of Job Openings at 1/13/2010: 622

• Most common salaried job: Manager with average salary of $105,544

This is the first we’ve heard of Connect but we’re guessing Zitor makes a regular appearance. If no Zitor, we wouldn’t bother.

On a more biological note, it’s not clear is where E&Y would rank if Fortune had gotten word of someone hoarding the keys to the mens john in Jericho. We figure if they knew a sicko like that worked at E&Y it would knock them out of the top 50 at least.

Layoff Watch ’10: More Details on Ernst & Young

Thumbnail image for ey8ball.jpgWe have some additional details to share with you to supplement last Friday’s post on E&Y’s New Year layoffs.
While we were surprised at the timing, a source has indicated to us that IT Risk and Assurance layoffs have occurred at the firm each January since 2008. This is due to a serious drop off in utilization in the new year after high utilization in the fall months with the exception of especially in the audit heavy ITRA practices.
In regards to the audit practice, we spoke to another source over the weekend that told us that layoffs would not occur until after busy season but assured us that they are being planned.
Finally, in response to one comment asking about severance details, we were informed that the severance for those let go is a week’s pay for each year of service with a minimum of 4 weeks pay. This seems to be fairly standard (with a few variations) amongst the Big 4.
We’ve received word on some positions cut but we’re still awaiting further details so if you have any information or can provide more insight discuss below or get in touch and we’ll update them here.
UPDATE: A source has indicated that three IT Advisory managers in FSO in New York were included in the cuts.

Layoff Watch ’10: Ernst & Young January Edition

Confused doesn’t even begin to describe what were feeling. We are hearing tons of rumors about layoffs in the Ernstiverse this week.

We’ve heard rumors from Denver to the East-Central (fka North-Central) and New York FSO. This includes both client serving professionals and support staff. We have already confirmed that two admins were let go earlier this week in New York.

The timing is especially strange since, you know, it’s January and in some offices the mandatory hours have already rolled out. Even if it were only support staff being let go, the timing is still unheard of. Why wait until January to let people go when having cuts in November? Maybe it’s just us but if we had survived that November cut, we would have thought that our job would be safe until at least the spring.
And since the roundtables seem to be SOP you wouldn’t think they would be anything to worry about but they definitely have people talking and wondering what will go down.

So far, Ernst & Young has not responded to our request for comment.
If you hear anything about your office get in touch in with us and discuss in the comments.

Rumor Mill: New Ernst & Young Office Requires Sterile Cubes, Secure Lavatories

As you’re all aware, your working environment is crucial to your productivity (or lack thereof). The slightest change can throw off your mojo for days or weeks at time. Maybe indefinitely.

So when we heard that the E&Y Long Island office had moved from Melville to Jericho we were concerned for the professionals in that office.

Brand new office in EY spirit, bright white, yellow partner and senior manager offices, orange walls in the enormous staff through manager room. We have super tiny cubes with really short walls where you just sit up an inch and you can see the person across from you. No space heaters or mini fridges allowed and you aren’t allowed to put up anything on you [sic] “cube” / “workstation” walls. They have to remain white. Oh and the bathroom requires a key in which you must walk from the far back of the office (where are seats are) to the front desk to get the key. There are 5 keys for men and 5 for women but the mens keys have dwindled down to 2 so you have to wait for someone to come back from the bathroom to go.

The team colors are a nice touch but the cube dwellers aren’t allowed to decorate? No pictures of spouses, kids, friends, dogs, cats, co-worker crush, favorite metal band allowed? What about the certificate you got from the latest in-house CPE? Can that go up? It sounds as though TPTB are insisting on the most sterile environment possible. No distractions. What about looking that person across from you dead in the eye while they’re eating with their mouth open? How’s that for a distraction?

Speaking of sterile environments, what’s with the bathroom keys? Are homeless people sneaking in and stanking up the joint? And they’re down to two keys for the men? Where did the other three keys go? What sadist is hoarding keys at the expense of other people’s excretory and digestive systems? Any ideas people? Maybe the keys just got flushed. Let’s get to the bottom of this mystery. Discuss.

Ernst & Young Extends Busy Season Two Weeks

While Deloitte rings in the new year with generosity, E&Y has apparently taken a different approach.
One of our sources in the Ernstiverse has told us that busy season is being extended by two weeks this year. The first “official” week is this week (moved up one week from its usual spot) and there will be an additional week on the back end (first week in April as we understand it). This means mandatory 55 hours weeks are in full effect, so find some work people.
Oh! And it’s also our understanding that this week, “roundtables” are going on in the audit practice. We don’t know what those are exactly but it sounds sorta serious and it’s definitely not billable, so enjoy making up the time. If you’ve had the pleasure of attending one of these sit-downs, let us know how it went and keep us updated with other details.

Rumor Mill: More Ernst & Young Offices to Become “Virtual”?

Thumbnail image for EY Ball of Useless.jpgLast month we told you about the E&Y Greensboro office shutting its doors to become a “virtual office”. All the client-serving professionals (around 60) are now reporting and being serviced out of the Raleigh office.
This followed the closure of the Manchester office that we reported on in October and that became official in November. In this particular case, there was no merging of sites and client service professionals (non-partners) were let go.
The latest speculation is that there are several small offices that are at risk of going virtual as opposed to out-right closing post busy season, using the Greensboro office as the model. Offices that are being serviced by nearby larger offices are of greatest risk as well as small offices that have a dwindling client base.
Although the virtual office seems to be the most warm and fuzzy of the two options, there would certainly be layoffs of support staff and service professionals that weren’t interested in working from an office that was a considerable distance from where they lived.
Whether or not this strategy will be utilized by other Big 4 firms is not clear but this story will continue to develop as busy season progresses. If you hear rumors about your office get in touch with us. We’ll keep you updated as we learn more.

How Does Seeing 5 Times Square on New Year’s Eve Make You Feel?

EYa.jpgWe’ve noticed a lot of chatter in the Twitterverse from soldiers in Uncle Ernie’s army regarding the E&Y sign in Times Square. As you might imagine, the reaction is mixed.
Wanting some reader input we asked around to some of our E&Y sources for their thoughts on seeing the sign on the tube while ringing in the New Year or their reaction if they saw it. So far, we’ve only heard back from one source (are people working too hard already?):

Hmmmm EY on a TV…..I’d flip the eff out!!!!!! No raises this year. I’d probably drag the TV out by its power cord. Then I would taunt it, kick it, give it cigarette burn marks and finally bury the tv alive by strapping it to a gas generator and dumping it in to a smelly landfill. I would then go home, feel bad for the tv for about 5 seconds and eat some apple pie.

For the non-E&Yers the sign may not provoke such shockingly violent images. However, if you did have any thoughts, any thoughts at all, when you saw the sign on NYE, feel free to share them here. We don’t want you to scare your therapist.

Rumor Mill: More Ernst & Young Restructuring Details

Thumbnail image for ey8ball.jpgWe’ve got a follow up to our post yesterday about E&Y’s restructuring plans for the North Central and Pacific regions.
A source has informed us that the Financial Services Office (“FSO”) began nationalizing non-audit banking and asset management clients earlier this year. Insurance clients are also going to be under FSO, which will centralize all non-audit financial services clients. Our source has further indicated that the next step is to nationalize the audit clients. The ulitmate goal is to slim the firm down to five total regions (West, Central, Southeast, Northeast, and FSO).
We asked a couple of sources about this particular rumor to get some opinions:

I do hope this is not true, as [FSO] can’t audit their way out of a paper bag. I’m not sure why they would make an interim step as they’re making now if there’s an ultimate goal of five sub-areas

Another view:

Running FSO out of NYC seems like a good call from an overhead…cost standpoint but that’s about it. I have heard horror stories about the kind of hours FSO staff typically pull year round. I don’t see this making the “people in the trenches” any happier. Having all the work routed to one place makes it easier…to make sure that work is getting done…Of course I think this is just going to turn FSO into more of a meat grinder than it already is since they are going to do everything they can to get as much work in the pipeline as possible to keep that group busy.

As we mentioned yesterday, E&Y would not comment on internal firm matters.
If you’re in the FSO practice and can attest or refute any of the above details (horror stories, meat grinders, auditing out of paper bags) or even if you’re not and have an opinion share your thoughts below.

In Better Late Than Never News…

Thumbnail image for Thumbnail image for two thumbs up.jpegHey gang, we’ll just take a moment of your time to point out the bang-up job that’s being done at the The Business Journal of the greater Triad Area. They’re not in the class of the CNNs of the world but we figure some recognition is appropriate.
They ran a story dated Friday the 18th entitled, “Ernst & Young merging sites, making Triad virtual office” which is kinda, sorta similar to a post we did on December 10th.
Maybe we’re hung up on little stuff like choice of words and timing but we’ll be damned if we see “first reported by Going Concern” anywhere.

…roughly 60 client-serving professionals based in the Greensboro office at 202 Centreport Drive will remain with the firm, with most staying in the Triad to work remotely. They will report to and receive support services from the Raleigh office…
The statement did not specify the impact of the move on Triad support and administrative staff, including whether there are any transfers or layoffs occurring.

If the TBJ is curious, we know the impact on the support staff. You can email us here if you’re still wondering.
We also don’t see any mention of the Manchester closing either but that’s in a whole other state, so it’s probably not relevant.

Ernst & Young Restructuring Plans Affect North Central, Pacific Regions

Thumbnail image for ey8ball.jpgWe received several reports over the weekend and today about regional restructuring at Ernst & Young that will go into effect on January 1.
The majority of the North Central region will combine with the Mid-Atlantic region to form the new “East-Central” region, while the Toledo and Detroit offices will join the Midwest region. One source has told GC that this move is “an effort to reduce infrastructure and we should not be distracted from our client serving duties.”
We have also confirmed that the Pacific Northwest and Pacific Southwest regions will combine into a single “West” region. Again, sources indicating this move is an attempt to reduce overhead costs, saying “Lots a current senior leadership will be moved around,” as a result of this consolidation.
Both regions have seen significant layoffs just in the past month, and reports as recently as December 9th for the North Central. Some may go so far to say that the layoffs were a precursor to these plans but that’s speculative sport on our part.
We reached out to an E&Y Spokesperson who said that the firm prefers not to comment on internal matters.
E&Y’s restructuring follows a major restructuring at KPMG that we reported on earlier this year which saw several leadership changes and rumors of the firm consolidating down to two regions in the U.S.
One of our sources indicated that more news is expected this week so if you have any further details on these changes, get in touch with us, and discuss your thoughts in the comments.

The Day After: KPMG and E&Y Holiday Party Report

Thumbnail image for HolidayParty.jpgWe were reminded that not only was E&Y FSO raging at a tourist trap last night, KPMG’s Financial Services practice was also tying one on at Jim Brady’s in the FiDi. This particular fiesta is the first major get-down we’ve heard of KPMG hosting so it’s good to know that there’s a little bit holiday cheer at every firm.
The Jim Brady’s party has been a popular event in the past and it’s a partner-free party so it’s a perfect opportunity for Klynveldians to blow off some steam, pants optional.
One source told us that it was well attended again this year despite being beer and wine only. We’re confident that was supplemented by flasks and other treats as another told us that the party was a “blast”. Safe to say that there was plenty of ass-grabbing as well as being an all-around bitch-about-KPMG fest.
Considering we haven’t heard a peep about E&Y’s get-down at TOTG, we can only assume that it was also epic.
Hopefully your cocktail flues have subsided to the point that you can tell us about the great night. If you remember anything, share the highlights or get in touch.