Category: KPMG

Email Reminds KPMG Tax Group That You Best Remain Chargeable in the Summer-Fall Busy Season

As summer creeps to a close, that means one thing for Big 4 tax compliance folks – Busy Season 2.0. In a lot of ways, this time of year can be worse than the late winter/early spring as the drop deadlines approach and your deadbeat clients that never get you what you need on time remind you why they are your deadbeat clients.

It also means the return of mandatory 50+ hour weeks (that’s on the low end). Typically a simple communication from one of the higher-ups in your group should suffice but sometimes a few extra instructions get included. This was the case in an email sent to the troops in KPMG’s Fed Tax Group in the Dallas office yesterday afternoon:

From:

Sent: Wednesday, August 04, 2010 2:42 PM

To:

Subject: 2010 Fall Busy Season Hours

The summer-fall busy season is now upon us. Effective immediately through September 15th, all senior associates and associates in the Fed Tax practice should have a minimum of 50 hours of chargeable work per week. If you don’t have work to fill this time, please contact Elizabeth Emerson immediately with your availability and she will work to assign your time to projects. New this year, if you have any unassigned time, the expectation is that you will send a short email to your manager and copy [redacted] on a daily basis with the number of available hours (out of 10) that you have to work on projects. As you are assigned please remember that it is imperative to keep [your timesheet] updated and accurate.

Thanks in advance for all your hard work and efforts during this busy season.

The “short email” probably won’t apply to many SAs but there are probably more than a few A1s and A2s that will find gaps in their day and a quick typing of “I’m unassigned for X hours” today will probably suffice. Annoying? Yes. Necessary? Perhaps. As everyone knows, if you’re not fully chargeable, it could mean the end of your illustrious Big 4 career (and even if you are, that might not save you) and Fed Tax compliance is known a popular group for layoffs come post-October 15th.

But our source interpreted the email this way:

I guess we will have to start asking for permission to check emails and take bathroom breaks, otherwise we will have to “send a short email on a daily basis” explaining why we were unchargeable for 30 minutes a day…

So tax people – how do you read this email? A friendly reminder with a simple request or just one more thing to lump on your pile? Discuss.

The Restatement That Never Ends: KPMG Hasn’t Received Necessary Docs for Satyam

Back in June we told you about Satyam requesting just a wee bit more time to nail down their restatement of their financial statements. It wasn’t because KPMG and Deloitte weren’t working their asses off, it was more of commitment to get things right. Putting good numbers out there, repairing broken trust, so on and so forth.

Well! The three month extension ends next month but as you might expect, there’s a bit of a problem. More specifically, KPMG is now saying that they haven’t received the documentation necessary to finish the job. Unless everyone is okay with some wild-ass guesses, in which case they can proceed.

[F]or all its documents, KPMG had to depend on the [Central Bureau of Investigation (“CBI”), which is investigating the scam.

NDTV has learnt that KPMG’s analysis of the documents don’t match with the CBI’s. There is a discrepancy between the two which amounts to over [$200 million].

CBI has based its calculations on estimates of Satyam’s assets and liabilities while KPMG says they need documentation to base their estimates.

KPMG says that they didn’t get all the documents needed to make a clear assessment which is why the accounts are likely to be re-stated full of riders.

But again, if you’re cool with some double-entry hocus-pocus, that can be arranged. There’s a merger at stake after all, “This confusion in the numbers could hold up Satyam’s merger with Tech Mahindra, which needs the go ahead from market regulators in India and the US, since Satyam is also listed in the US.”

Good luck getting that U.S. approval.

Satyam accounts restatement: KPMG’s analysis differs with CBI’s [NDTV]

Compensation Watch ’10: KPMG Puts Some Ballpark Figures Out There

Since it’s Monday in late July (and many people probably had one old fashioned too many last night) we figured this day would have gotten off to a slow start. Well, we’re in luck! KPMG comes roaring out of the gate today with a little compensation update from none othercall me Rudy” Veihmeyer and Henry Keizer.

The news? Well, the promotions bonuses have caused some belly aching so the boys thought they would give you a sneak peak at what you can expect come merit increase time:

Update on Our Plans for 2010 Compensation
A Message from John Veihmeyer and Henry Keizer
8:19 AM ET, July 26, 2010

In April, we told you that there would be compensation increases for the great majority of our people and, assuming KPMG meets its FY10 plan, higher bonuses than last year for EP performers, and bonuses for higher performing SP employees as well. Now, as we head into the fourth quarter, we would like to provide you with an update on this matter. As you view this information, please keep in mind that compensation increases are determined on an individual basis, and reflect each employee’s role, skills, performance, geography, and experience, among other factors.

· Merit and Promotion Increases – For employees who are not being promoted, we expect SP performers will receive merit increases that will range from the low to the mid-single digits; EP performers will receive increases up to the high-single digits and in rare cases double digits.

In addition to any merit increases, employees who have been promoted should expect to receive a promotion increase of approximately 5 percent, with one exception: newly promoted CSD Managers should expect to receive a promotion increase of approximately 10 percent.

· Variable Compensation – The FY10 pool for variable compensation will be more than double what it was last year. This means that EP-rated employees will generally receive bonuses that are significantly higher than those of last year. In addition, approximately the top half of our SP performers will also receive variable compensation awards.

Please keep in mind this information is preliminary. Final compensation decisions will be made based upon our full-year results, so the ranges above could be adjusted based upon our firm’s performance between now and September 30. But, consistent with our commitment to keeping the lines of communication open, we wanted to share with you our best current forecast about these important matters.

In line with our compensation philosophy and our focus on a high-performance culture, we remain committed to sharing the rewards of the firm’s financial performance with our employees and providing a competitive total compensation package that differentiates exceptional performers with superior rewards. As we have said before, the strong foundation we have built within the firm, as well as our near- and longer-term business prospects, make us very optimistic. But to finish this year strong and begin FY11 on a positive track, it is critical that we continue to drive a high-performance culture by doing our best work, providing the highest-quality service to our clients, growing our business, and operating efficiently.

Thanks again for your continued hard work and for all you do to help our firm succeed!

So now that you have that to chew on for your last Monday in July, feel free to discuss the “low to the mid-single digits” for the strong and “high-single digits and in rare cases double digits” for the exceptional. And if you’ve got thoughts on the variable comp pool, you can go there too, if you like. Keep us updated.

KPMG Is Overachieving in the Green Department

Klynveldians may remember back in 2008 that the firm embarked on a divine green mission to reduce waste, its carbon footprint, so on and so forth.

Well, the firm announced today that not only has it achieved its goals in two years instead of three but it also exceeded the percent reduction goal of 25% with a 26% reduction in its carbon footprint.

• Formation of Living Green Teams to harness the passion of KPMG’s employees and partners in local offices nationwide. – See a Living Green Team member at right.

• Recycling of every laptop, monitor and printer, for both reuse and disposal of toxic materials – This is good considering all the layoffs that KPMG did from 2007-2009, there was probably a lot of laptops sitting around just collecting dust.

In all quasi-seriousness, it’s good to see the firm taking steps to put the green back in green eyeshade. Now if we could get everyone to bike or walk to work, we’d really have something. Discuss your impressions with KPMG’s treehuggery below.

NEW YORK, Jul. 21 /CSRwire/ – KPMG LLP, the U.S. audit, tax and advisory firm, today announced it achieved a 26 percent reduction in its carbon footprint from 2007 through 2009, exceeding the firm’s stated three-year commitment of a 25 percent reduction in just two years.

In 2008, KPMG embarked on an ambitious environmental program in the United States called “Living Green” to support the firm’s commitment to reduce the amount of waste it generates, the volume of natural resources it consumes, and to reduce its carbon footprint. When it was announced, KPMG’s Living Green program targeted a 25 percent reduction in the U.S. firm’s overall carbon footprint by 2010.

The firm’s 26 percent reduction from 2007 through 2009 is based on the results of a recent analysis by KPMG’s Climate Change and Sustainability Services group that shows KPMG reduced its carbon footprint by 20 percent between 2008 and 2009, and 7 percent between 2007 and 2008.

“Living Green at KPMG has helped us better understand the need to adapt to climate change and invest in sustainable, eco-friendly business initiatives,” says Steve Clemente, KPMG principal and leader of the Living Green program. “Thanks to the commitment of our firm and the support of our 20,000 plus people nationwide, we are helping change the environment in which we live and work for the better.”

During the course of its Living Green program, the U.S. firm has reduced its electricity consumption by 9 percent and reduced paper consumption by 33 percent, while having increased the percentage of recycled paper used by 85 percent.

“KPMG’s successful carbon reductions represent the kind of corporate leadership we need at this time of environmental and economic crisis,” says Matt Petersen, president and CEO of Global Green USA, a national environmental non-profit organization dedicated to implementing solutions to global climate change. “KPMG is establishing – and beating ahead of time – reduction goals that save money and resources while reducing the carbon pollution that causes global warming.”

In achieving these results, KPMG is identifying leading practices and establishing new programs and processes at both the local office and national levels. They include:

• Formation of Living Green Teams to harness the passion of KPMG’s employees and partners in local offices nationwide. These teams implement the Living Green program at a grassroots level, driving innovation and making a difference through initiatives such as local specialized recycling programs, engagement with city-wide environmental programs, and hosting volunteer events with organizations dedicated to sustainability during KPMG’s annual Living Green week which is held each year in conjunction with Earth Day.

• Completion of a KPMG data technology center that uses multiple sources of electrical power, but features gas micro-turbines as its centerpiece. The natural gas-powered units provide exceptional energy efficiency, helping generate more than 70 percent of the power needed to run the facility and produce ultra-low carbon dioxide and particulate emissions.

• Recycling of every laptop, monitor and printer, for both reuse and disposal of toxic materials, while implementing server virtualization, which involves using one computer server to do the work of many. Server virtualization has prevented the emission of over 1,000 tons of carbon dioxide.

• In 2009, KPMG’s new Nashville office became the first firm office to be Leadership in Energy and Environmental Design (LEED) certified by the U.S. Green Building Council (USGBC), followed by offices in San Diego and Orange County, California. Recently, firm offices in Boston and Charlotte received gold-level LEED certification.

“Being a responsible corporate citizen is a key driver of KPMG’s business, affecting our relationships with clients, shaping the experiences of our people, and inspiring us to be a positive force in our communities,” says Kathy Hannan, KPMG national managing partner, diversity and corporate social responsibility.

Exodus Watch: Some Are Concerned About the Direction of KPMG’s Headcount

Granted, this does not take into effect the 23 soon-to-be KPMG Kampers jumping over from Grant Thornton but at least one Klynveldian was concerned enough to send us this:

Our source told us, “Linkedin.com gives these updates to those listed as KPMG employees.” Thinking this over, this may be trailing the movement we’ve seen over the last couple of months (since no one updates their LinkedIn accounts). Or this could just be the latest round of ship jumpers. With comp adjustments coming up relatively soon, you’d think people would sit tight for just a smidge longer to see how things shake out. OR maybe these LinkedIn numbers are just a bunch of malarkey and our source is going ape for no reason. We’re not really at liberty to say.

Discuss the latest bodycount in your office.

KPMG Acquires Grant Thornton’s Supply Chain Advisory Services Practice

KPMG’s Advisory practice will take over Grant Thornton’s Supply Chain Advisory Services practice, the firm announced today, in a deal that closed on July 16th. The purchase includes “the addition of 23 highly-skilled, experienced professionals to KPMG” and the firm will also take over the existing projects “at select Fortune 500 companies.”

This is certainly appears to be a nice little boost for KPMG’s Advisory practiceclear whether this will be a big part of the advisory practice or an area for potential growth in jobs and revenues, TPTB seem pretty excited about it (see boilerplate after the jump).


But we think the more interesting aspect of this particular deal is the strategy of Grant Thornton. Back in January when Stephen Chipman gave his first firmwide call to the troops, he discussed many things including the not so subtle warning that some people would not be “joining us on the next stage of our journey.” That’s a pretty clear message but nowhere in the message to the firm was the slightest indication given that this, dare we say, firesale would be occurring.

This is the fifth major move that we have covered involving Grant Thornton just this year. We have reported on sales of GT’s Albuquerque, Honolulu offices as well as the closure of the Madison and Greensboro offices.

This is the first sale of a practice that we have covered and KPMG is the largest firm to be involved in one of these transactions. Moss Adams purchased GT’s Albuquerque office and partners in the Honolulu office purchased the practice to become an affiliate of PKF.

Perhaps this part of the journey was too sensitive to share with the troops or maybe it was communicated in code that could only be deciphered with a secret book with all the definitions OR maybe the majority of people at GT weren’t paying attention to anything SC said unless it included the words “compensation,” “promotion,” or “bonus.” We can’t really say.

That being said, we are still hearing rumors of other office sales by GT. Nothing we’re permitted to share with you now but if you are aware of any talk about a possible sale in your city, get in touch with us. And if you’ve got thoughts or knowledge on this particular deal – from the perspective of either firm – share below.

NEW YORK, July 19 /PRNewswire/ — KPMG LLP, the U.S. audit, tax and advisory firm, today announced it has expanded its restructuring capabilities through acquisition of the Supply Chain Advisory Services practice of Grant Thornton LLP, U.S. member firm of Grant Thornton International Ltd.

The acquisition strengthens KPMG’s existing restructuring services practice in the automotive, pharmaceuticals, aerospace and defense and other manufacturing industries by expanding current capabilities in financial and operational restructuring, supply chain advisory, supplier services, technology and performance improvement. The transaction also includes Grant Thornton LLP’s Vontik software system.

“As organizations continue to reinvigorate their focus on growth, they are facing unprecedented pressures to transform their finance and operations functions,” said John Veihmeyer, Chairman and Chief Executive Officer, KPMG LLP. “This acquisition will enhance KPMG’s ability to help businesses address the four key drivers of business transformation: people, process, risk and control, and technology.”

The transaction, which closed on July 16, includes the addition of 23 highly-skilled, experienced professionals to KPMG. KPMG will also take over existing Grant Thornton LLP projects at select Fortune 500 companies.

“As the already strong demand for large scale transformation and restructuring assistance continues to grow, this acquisition helps us provide the functional breadth and depth needed by large organizations across several key industry sectors,” said Mark A. Goodburn, Vice Chairman and Head of Advisory, for KPMG LLP. “It’s also consistent with our continuing strategy to build superior large-scale transformation capabilities to serve the world’s top organizations.”

“Adding these tactical, operational restructuring and supply chain skills to KPMG’s strategic market position is a great fit, at the right time,” added Drew Koecher, partner and head of restructuring for KPMG LLP. “With the addition of this group, we broaden and deepen our client base and add to our already extensive advisory capabilities to serve businesses as they transform their business models to be successful in this new economy.”

Attention KPMG Kampers – Phil Mickelson Needs Your Help!

We’re dispensing with QOTD today to bring you an opportunity of a lifetime. Phil’s cozy little love nest in Santa Fe, CA is up for grabs and we think it’s a grand idea for a few Klynveldians to pool their resources together to take it off his hands. It’s been on the market for two years so obviously T Fly isn’t up for it an the freshly minted honchos.

So we leave it up to you, men and women of KPMG. Get some friends together and make the man an offer. It’s currently listed at just a shade under $9 mil so it’s completely unreasonable. What you do to celebrate your new home after the close is up to you. If you’ve got suggestions for theme parties, technical accounting trainings or simply a shrine to man himself, give your best shot in the comments. But of course take a gander first….


[caption id="attachment_14359" align="aligncenter" width="560" caption="Helicopter not included"][/caption]

[caption id="attachment_14362" align="aligncenter" width="560" caption="Come on in!"][/caption]

[caption id="attachment_14363" align="aligncenter" width="560" caption="When he gets sick of Five Guys (rare occurrence)"][/caption]

[caption id="attachment_14364" align="aligncenter" width="560" caption="The Phil is great room"][/caption]

[caption id="attachment_14370" align="aligncenter" width="560" caption="Where the magic happens"][/caption]

[caption id="attachment_14371" align="aligncenter" width="560" caption="Plenty of room for Tiger\'s friends"][/caption]

All photos: Redfin

KPMG’s Risk Management Ad Jumps, Climbs and Flies but Misses the Point

Just as Washington is finally passing a bill that will reduce unnecessary risk-taking by financial institutions, here comes this commercial from KPMG in the UK doing the opposite. KPMG parties like it was 2005 and sub-prime was a bad cut of steaks. The commercial celebrates risk-taking in a manner that only a BP executive could rationalize deepwater offshore drilling.

Almost everything is wrong with this commercial:


Its heroes, a man and a woman, presumably KPMG employees, are living in a risky world. Risk is all around them, from the moment they get up. But don’t worry. These two nitwits know how to engage in risk management. Mostly in jingle and parkour, in fact.

Wikipedia tells us that Parkour “is where participants jump, vault, and climb over obstacles in a fluid manner. Skills such as jumping and climbing, or the more specific parkour moves are employed. The object of parkour is to get from one place to another using only the human body and the objects in the environment. The obstacles can be anything in one’s environment but parkour is often seen practiced in urban areas because of the many suitable public structures available such as buildings and rails.”

The two heroes run, jump, flip over and take maniacal risks along the way to the office. Along the way the tag line, “Turn Risk Into Advantage”, is reinforced by embedded messages, in case we did not get the main theme”: “Know Risk, Know Reward”, “Do You Have The Risk Appetite For Success?” “Always Be Ready For The Unexpected.”

I actually like the “Turn Risk Into Advantage.” It is clever, memorable, and summarizes nicely what corporations are seeking in risk management advice. Yet it is completely overshadowed by the flip execution and the manner that suggests that KPMG employees, and by extension KPMG, take risks haphazardly.

Besides being out of context and lacking a narrative, the commercial ends on a cheesy note: upon arriving into the KPMG office and performing obligatory back flips, the couple race up the stairs, looks over the rail, look at each other, smile, and decide not to jump and take the elevator instead. This is a sensible move, perhaps the first one in this commercial.

Risk management is an essential practice, and perhaps as this advertising suggests, more in need than ever. Yet, it is not clear to me why the issue cannot be addressed heads on and intelligently. The irrelevant “packaging” simply detracts from the appeal of the practice.

Avi Dan is President & CEO of Avidan Strategies, a New York based consultancy specialized in advising professional service companies on marketing and business development. Mr. Dan was previously a board member with two leading advertising agencies and managed another.

Lots of Appointing Going on at KPMG Today

Namely Jim Liddy the new Vice Chair – Audit; Tom Duffy – National Managing Partner – Audit; Scott Ozanus Vice Chair – Tax; and Jeff LeSage National Managing Partner – Tax.


And on such a grand occasion, John Veihmeyer gets to say lots of nice things about all these guys even though at least one of these guys is probably gunning for his position.

Jimbo: “Jim Liddy has a remarkable record of providing deep insights to financial service clients and companies in other sectors about their businesses and growth strategies, and is a proven leader. I’m confident that with his intense focus on audit quality, Jim will build on the strong audit practice that Henry Keizer created over the past five years to help ensure KPMG’s continued success.”

Tom: “As the newly named national managing partner – audit, Tom Duffy will team with Jim Liddy to lead our audit practice. Tom has considerable industry experience and a proven track record of delivering audit quality and exceptional service to our clients.”

Scottie: “We’re looking forward to Scott’s leadership during this important period for our tax practice and KPMG’s clients – as companies cope with legislative and regulatory changes, and seek clarity in complex challenges related to transfer pricing, restructuring, renewable energy and a variety of other areas.”

Jeff: “As the new national managing partner – tax, Jeff LeSage will team with Scott Ozanus to lead tax, bringing global tax experience, industry insight and outstanding client service skills to this important role.”

Congrats gentlemen. Not sure if these particular positions get you 18 with Phil or not but we’re sure they are sweet gigs all the same.

KPMG Appoints Jim Liddy Vice Chair – Audit [PR Newswire]
KPMG LLP Appoints Scott Ozanus Vice Chair – Tax [PR Newswire]

KPMG Partner Thinks It’s Really Unfair That Audit Firms Keep Getting Sued

You know what sucks? Getting sued. Ask Bill Michael, KPMG’s UK head of FS. He’s pretty sick and tired of all the sue-happiness going on in the world today. Sure, the financial crisis nearly destroyed the world as we know it but dammit, blaming auditors is downright ludicrous. Why? Because it’s unfair.

Bill Michael, UK head of financial services at KPMG, attacked what he described as “unfair”, “deep pocket” lawsuits which pay “little or no attention to the balance of responsibility between auditor and management”.

“We operate in a highly litigious environment where the balance of risk and reward has driven us to a world of caveats,” said Mr Michael. “Any corporate failure or financial loss invariably carries with it the risk of suing the auditor.”

Right. Because in law school they teach future litigators to “pay attention to the balance of responsibility between auditor and management.” Supposedly Bill Mike would like everyone to start respecting the Big 4 business model and leave them alone to do their work. Because in case you hadn’t heard, this is a life and death matter for accounting firms, you know:

“I can tell you, we are acutely aware of risk management and its consequences from both an individual and a firm perspective.

“You only have to look at what happened to a great firm like Arthur Anderson after its audit of Enron,” said Mr Michael. Arthur Anderson was eventually cleared after its audit of the collapsed energy trader, but the accountancy has already folded as a result.

He also criticised the “enormous rewards for failure” in the banking industry, drawing attention to the way some of those responsible for the collapse of major firms were able to move to other banks or hedge funds.

“The risk-reward relationship is not only lop-sided; it impairs our ability to provide broader observations,” said Mr Michael.

Describing the sometimes tense relationship between accountants and the firms they are auditing, he said that each review often started with the premise of “we don’t trust you”.

So in other words, get your witch hunt on with the banks and hedgies but leave us the hell alone. Nobody likes us the way it is.

Litigation culture is ‘unfair’ warns KPMG accounting head [Telegraph]

Bonus Watch ’10: There are Some Unhappy KPMG Kampers in California

At least it was a short week!

Looks like promotion bonuses are available to view under Self Service Connection for those who got promoted. 2nd year promote to senior (high SP rated) in specialty advisory (N. California) = 1.25% or $700 in my case. What a fucking joke…working for 2 years and I’ve been making progressively less and less money every year when you factor in a signing bonus in 2008 and a CPA bonus in 2009.

Keep in mind that the promotion bonuses are only for the “stub period” of July-September until the full year bonus/raise come into effect. I’ve also been told by numerous people not to extrapolate the stub period amount to a full year amount. Good thing they said that cause if 5% is my full year raise after 2 years of nothing, I’m out of here before you can spell GAAP.