Category: Big 4

If it happens at a Big 4 accounting firm, we’re talking about it here.

Who Has Questions for PwC’s Bob Moritz?

Good morning and welcome back, capital market servitudes. If you’re a PwC employee, you may or may not have heard some rumors that I might be making an appearance at the firm’s townhall meeting this week to chat up Chairman and Senior Partner Bob Moritz. Well, I’m happy to report that, despite a number (read: LOTS) of detractors and an intensive background check, I am being given 20 minutes with BoMo to ask him whatever I want. The problem is, I’m out of ideas.


Of course, that’s where you all can help. If you have questions that you’d like me to pose to Roberto, then please leave them below in the comments and we’ll add them to our current list of inquiries. Maybe you’re a PwC employee who wants to know where all the holiday cheer is. Maybe you’re wondering what Bob’s job entails when he’s not writing painful letters to auditing regulators. Maybe you’re a KPMG partner who is patiently waiting to HEAR BACK ABOUT A JOB. Whatever’s keeping you up at night, just let us know and we’ll squeeze in as many questions as time will allow.

This may be your one and only chance, so don’t let this slide. Go.

Bonus Watch ’11: PwC Tax Senior Has Nothing to Be Thankful For

This just in:

Folks at GC,

Last year, PwC announced in November Mid Year bonuses that were tax free (you did a story on this). This year, nothing so far. They need to be called out for this. Mark Mendola: WHERE THE BONUSES AT?

Love,
Tax Sr at PwC

To clarify, this is the story we did and, correct me if I’m wrong, the bonus was not “tax free” rather it was a net payment of $1,000/$500 (lower amount was for those hired after June 30). As for this year, our little Tax Senior with dirty diapers is right. We haven’t heard anything about mid-year bonuses, from Mark Mendola or anyone else. If you’ve spoken to him and know either way what the scoop is, please let us know. Someone’s Thanksgiving may be RUINED if we don’t get to the bottom of this fast.

PwC Now Picking Up Talent From a Big Law Firm

Namely, Skadden, Arps, Slate, Meagher & Flom LLP. Pamela Olson will head up PwC’s Washington National Tax Services practice when she leaves her position as Skadden’s Washington office tax group on January 1st. From the sounds of it, everyone is pretty giddy about this, mostly because Ms. Olson is kind of a big deal. “Everyone in the tax community knows Pam,” said Mark Mendola, PwC’s U.S. Tax leader. “Now our clients will be able to gain from her wisdom. In the current uncertain economic environment, the counsel she will provide to PwC clients is certain to be more invaluable than ever before.”

Why does everyone know her? Well she’s pretty good at what she does and she’s been around. She’s been an assistant secretary of tax policy with the Treasury department, chair of the American Bar Association’s Section of Taxation, a senior economic adviser to the Bush-Cheney campaign (we won’t hold that against her), a tax adviser to the National Commission on Economic Growth and Tax Reform and “repeatedly in Chambers USA: America’s Leading Lawyers for Business and The Best Lawyers in America for tax law.”

So not exactly a lightweight. All this and she never worked a day at KPMG. Amazing.

[via PwC]

Jim Turley Stepping Down as Chairman and CEO of Ernst & Young

~ Update includes statement from Ernst & Young

This morning we learned from a couple of sources that the big guy will be calling it a career officially on June 30, 2013 and the firm will announce a new CEO-elect at some point in early 2012.


Here’s JT’s message to the troops:

I have written to all our partners to let them know about my plans to retire from Ernst & Young on 30 June 2013.

Every year, our Global Executive (GE) considers the priorities and initiatives we feel Ernst & Young should focus on in the upcoming year, and these priorities are then approved by our Global Advisory Council (GAC), the top governance body of Ernst & Young.

Periodically, we also take a longer look at our strategy and vision, and involve the GAC in this as well. In July, we informed our partners that we were beginning such a long-term strategic review. The GE and I believe that our new strategy and leadership-succession plans are inextricably linked, and we agreed that June 2013 would be the right time for me to retire.

This is a normal process and the timing has worked out perfectly. I will be 58 years old, which is the normal early retirement age for many of our partners. By then, we will be implementing our new strategy and it’s right that a new leader should steer this implementation.

We are starting a robust process to identify the man or woman who will succeed me, in accordance with our regulations. We intend to identify a new Chairman and CEO elect during the first part of 2012. What I feel very good about is that we’re the type of organization that continually develops large numbers of great leaders, so I see many men and women who could lead Ernst & Young successfully into the future.

This is not a retirement letter or speech to you all, as there is much to do before June 2013. However, I wanted to be very open with you about our plans. Thank you for your continued support as we continue both our strategy and succession-planning process.

James S. Turley
Chairman and CEO

UPDATE: Ernst & Young provided us with the following statement:

In a communication to all Ernst & Young partners worldwide on 10 November 2011, James S. Turley, Chairman and Chief Executive Officer of Ernst & Young confirmed that he will retire as planned, aged 58, on 30 June 2013. The succession process to decide a new Chairman and CEO-elect is now underway and will conclude in early 2012, no later than April.

So after riding out Lehman, handing out a lot of trophies, and inspiring the greatest lyric in the history of Big 4 employee produced videos, (I’m sure there are other accomplishments too) Jimbo will ride off into the Black and Yellow sunset. This seems like an appropriate tribute:

Feel free to leave other well wishes below.

In Case the Tryptophan Doesn’t Work, Here Are the KPMG and PwC PCAOB Inspection Reports for Your Reading Pleasure

Actually, if you’re in to this sort of thing, it could make for some pretty interesting reading.


We pointed to a couple of reports this morning (and there are more) out there on the Board’s criticisms of the two firms, so we won’t repeat them here. The most notable thing seems to be each firm’s response to the report. KPMG went with the standard three-paragr��������������������er that promises that they’ll suck less at auditing in the future.

2011_KPMG_LLP_US


But as Floyd Norris pointed out, PwC’s Chairman and Senior Partner Bob Moritz as well as Assurance Leader Tim Ryan put their names on the firm’s response to the Board’s inspection that outlined what steps were being taken to improve the audit quality, which is a first. The firm also released this statement from BoMo, acknowledging the slight uptick in deficiencies:

PwC is built on our reputation for delivering quality. We also recognize that the role we play in the capital markets requires consistent, high-quality audit performance. We therefore are focused on the increase in the number of deficiencies in our audit performance reported in the 2010 PCAOB inspection over prior years. We are working to strengthen and sharpen the firm’s audit quality, including making investments designed to improve our performance over both the short- and long-term.

2011_PricewaterhouseCoopers_LLP

So you can all this – signatures, action plans, etc. – for what it’s worth but the messaging has certainly changed and it differentiates PwC from KPMG. Will have to wait and see if Deloitte or E&Y follow suit.

We Read This Awful Interview with Deloitte’s Joe Echevarria So You Don’t Have To

You don’t have to be Bob Woodward to recognize the formulaic nature of the CEO interview. Reporter goes to CEO’s office, asks loaded questions about the issues of the day, describes the view from the office, elaborates on the person’s exercise regimen, humble (or not so humble) beginnings, people they admire, yada yada yada. Cripes, reading these things makes you want to shave with broken glass but hey! editors get in ruts just liwe’re stuck with the puff. By extension, interviews with Big 4 CEOs are worse because they typically occur with General Counsel sitting in the next room zapping their genitals every time a question is asked that necessitates “I can’t comment on that.”

Today’s example comes courtesy of Reuters who interviewed Deloitte’s Joe Echevarria. What prompted this little chat was the PCAOB’s release of Part II of the firm’s 2008 inspection report. It wasn’t exactly a flattering portrayal of a firm who, when asked to brush up on their audit skills, basically told the PCAOB to drop dead.

Accordingly, the firm is running damage control and that involves getting Joe E. in front of some friendly reporters (read: not Jon Weil or Francine McKenna).

Recently faulted by the main U.S. auditor watchdog, Deloitte has told its professionals that skepticism should be the No. 1 focus during the upcoming auditing season for annual financial reports, CEO Joe Echevarria said.

“I know there’s a heightened awareness about professional skepticism in the firm,” he said. “It’s going to take a while for heightened awareness to manifest itself in actions and documentation because humans are involved here.”

The natural follow-up question here would be, “But Mr. Echevarria, the PCAOB asked you to fix things in 2008-2009, are you saying that you’re now just ‘manifesting itself in actions’?” but that brings out the zapper. That’s okay, we’re all used to it. You know what else we’re used to? Talking about the “expectations gap”:

There is an “expectations gap” between what auditors do and what the public expects, but auditors do have an obligation to detect and report material fraud, Echevarria said.

Echevarria is also asked about auditor rotation, IFRS and (for some odd reason) its settlement over the Adelphia fraud in 2005. Why not ask about the swinging insider trading scandal? What about Taylor, Bean & Whitaker? What about associates sneaking bloggers into the downtown W? WHAT ABOUT THIS FAUX TARA REID MARRIAGE? People want these all-important questions on the record and yet it never happens. Sigh.

By the way since it’s obvious that some of you care about these details, Joe is from the Bronx and his office is in Midtown.

Deloitte pressing for more skeptical audits (God, the headline is even awful) [Reuters]

Deloitte Associate Who Supports Occupy Wall Street Admits That His Idea of Camping is the W Hotel

[caption id="attachment_51784" align="alignright" width="260" caption="Source: NYP"][/caption]

As you know, a number of people in Lower Manhattan have spent the last two months Occupying Wall Street by way of camping out in Zuccotti Park. While September and October proved to be unseasonably warm, thus allowing Occupiers to exercise their 1st Amendment rights in relative comfort, November has brought cooler temps which has caused some relative discomfort among the campers. Oh, and Mayor Bloomberg was sorta sick of the mess and had everyone’s tents forcibly removed.

While many protesters have had to seek less squalid accommodations, other supporters of the movement have been able to find quarters that are more suitable for their tastes. This includes Deloitte associate Brad Spitzer who has been traveling to New York from California for work and has taken the opportunity to get his occupy on. And while he’s enthusiastic about the cause, Spitzer isn’t exactly down for park living:

“Tents are not for me,” he confessed, when confronted in the sleek black lobby of the Washington Street hotel where sources described him as a “repeat” guest.

Spitzer, 24, an associate at financial-services giant Deloitte, which netted $29 billion in revenue last year, admitted he joined the protest at Zuccotti Park several times.

“I’m staying here for work,” said Spitzer, dressed down in a company T-shirt and holding a backpack and his suitcase. “I do finance, but I support it still.”

You guys understand. There are just certain comforts that a Green Dot employee gets accustomed to – a soft mattress, a hot shower, room service – no matter how good of a drum circle you find.

Occupy Wall Street protesters stay at $700-a-night hotel [NYP]

PwC Sustainability Partner Blames His Dull Job for Not Rocking “Green” Shoes

If you’re a sustainability professional, people might make the assumption that you are a tree hugger. A green weenie. A dirty hippie. A person who has as much need for a pair of wing tips or business appropriate pumps as a fully loaded H2. Well you can put those suspicions to bed my friends.

Above is PUMA CEO Jochen Zeitz along with a couple of guys from environmental consulting firm Trucost and PwC sustainability partner Alan McGill. As you can see, Mr. Zeitz and the Trucost boys opted for some “green” sneakers to go with their Brooks Brothers. Mr. McGill, on the other hand, is in the standard issue Allen Edmonds. The reason for not getting on board with the hip skids? He’s lame:

The firm’s sustainability partner jokingly suggested his job was too dull to warrant a jazzy pair of sneakers.

Sceptic Tank reports that a PwC spokeswoman clarified the meaning of “dull” to be “PwC can’t be seen to be promoting their clients products in any way.” Which probably also explains why McGill wore a tie as well. Can’t be too careful about these things.

PwC and the fashion faux pas [The Sceptic Tank]

Former KPMG Partner Wants a Job That Is Worse Than Being a KPMG Partner

I kid, I kid. There are plenty of KPMG partners who couldn’t be happier if they were PwC partners. ANYWAY, that’s beside the point. What is the point is that former House of Klynveld partner Leslie Coolidge is running for U.S. Congress in Illinois’ Sixth District. Why would a seemingly normal person CPA opt for a career in the dungeon asylum hellhole that is the House of Representatives? Well, she has her reasons:

“Like many of us, I have become increasingly dismayed by the apparent unwillingness of our current Congress to address the critical issues facing our country today,” Coolidge, 52, said. “As I watched the brinksmanship this summer as Congress actually considered letting our country go into financial default, I knew I could no longer sit on the sidelines. As a CPA, I can delve into and understand complex financial matters and create innovative solutions that make sense. In addition, much of my career was spent negotiating among parties with divergent views to find ways to successfully move forward, something Congress is not doing.”

An agent of change! A uniter, not a divider! All that crap! How could it go wrong?

Coolidge announces candidacy for Congress [NS]

Interns, Here’s the Lowdown on Ernst & Young’s FSO Assurance Practice in NYC

Ed. note: Have a question for the career advice brain trust? Email us at advice@goingconcern.com with your problem(s) but only if you’re comfortable being mocked in an older sibling kind of way.

GC,

I know my question is somewhat specific but I just accepted an Internship offer for E&Y FSO Assurance in NYC and was interested in gaining some insight into the 3 divisions within FSO Assurance. First, I would love to hear your opinion on the pros and cons of each of the three sectors (Asset Management, Banking, & Insurance) including which EY is best known for. I was also wondering if there was a clear leader in each of those sectors in NYC and was wondering which of the Big Four was bestnks so much for your help. I know I am still a year away from having to actually select one of those options but gaining people’s opinions never hurt. Thanks so much.


Congratulations on landing a sweet summer gig with Uncle Ernie. You’ll be working for a great firm in a great city making a great salary while fetching great coffee for your superiors. Cheers!

But really, welcome to New York. You’re smart in thinking ahead to the fact that where you start with your internship will lead to a fulltime offer with the same group. This is because internships are essentially training camp for your first year – make it through the summer successfully and you’re in the club. I did a little digging within my professional circle to uncover some of the EY clients that you’d have the potential of working on, as well as my own two Lincolns.

Insurance – Let’s start with this one because I have a feeling that the group consensus will be unanimous: DO NOT JOIN THIS GROUP. Sure, it is a small, “family-like” practice in the financial services industry, but you’re not coming to work for the warm and fuzzies (if you are, avoid public accounting altogether). You’re coming to make yourself a valuable asset to future employers – one, three, or ten years from now. Can you receive accelerated responsibilities and extensive interaction with your clients? Yeah, but that’s because your co-workers are jumping ship and no one within the firm wants to transfer to the Insurance group. Unless you have an absolute passion for the industry (which you don’t, since you emailed us), I would avoid this group. Stay in this group for five years (you know, to make the dream promo to manager) and you’re setting yourself up for a career working for an insurance (or re-insurance) firm.

Banking and Capital Markets – This group is bigger and more prominent than the Insurance group. It’s taken its hit in recent years because…ummm…the banking industry is in turmoil, but some of the pain has been buoyed by their growing Broker Dealer client base (also falls into this group). Potential clients include Bank of America (*gulp*), UBS Wealth Management (the shining star in the UBS sky), Icahn Securities, JG Wentworth, ING Financial Holdings, and Cantor “run for the hills” Fitzgerald. Sources tell me audit staff are constantly trying to take rotations to the asset management group, so take that for what it’s worth. Career advancement outside of public can take you to either a banking or hedge fund depending on your client exposure, but have you read the papers recently? Banking ain’t the hottest date to the prom to these days.

Asset Management – this is EY’s money train in New York when it comes to audit (and even tax) services. EY and PwC dominate this market in New York, and depending on whom you ask EY has a more rounded client base (blue chip and start ups). Premier clients include Eton Park, Reservoir Capital, Anchorage Capital, and Och Ziff Capital (do some Googling to get an idea about these firms). The exposure to different investment strategies and financial products you will see will be second to none. Don’t forget that you can count the relevant investment banks left standing on two hands, whereas there are thousands of hedge funds and private equity firms in the country (most of which are in the greater NYC area, too). Your easiest and most lucrative path out of audit and into the private sector will be with a background in asset management. Absolutely, positively, 100%.

So there you have it. As always, GC’er please chime in below with your comments.

Deloitte Taking Precautions for Possible Unwelcome Guests

This just in:

WFC Update
Zuccotti Park Evacuation

As a result of the evacuation of protestors in Zuccotti Park early this morning, there will be limited access into 1 and 2 WFC until further notice.

Currently, the walkway bridge that connects 1 and 2 WFC will be closed. All building tenants must present identification to gain access. For visitors, the name of the tenant and person visiting will need to be provided to building security.

Access restrictions are subject to change, as information and updates from building management are changing rapidly.

We appreciate your cooperation and will continue to keep you informed through this mailbox. If you have any questions or concerns please do not hesitate to reach out to myself [redacted email] or [redacted].

[Guy who gets to deal with these sorts of things]

Area Operations Manager

Deloitte Services LP

Your Ernst & Young Entrepreneurs Of The Year Include the Dude From Groupon, Patrick Byrne

We really don’t pay much attention to the E&Y Entrepreneur thingamajigs because, well, it’s boring. Sure, we like entrepreneurs just fine but c’mon. These guys are filthy rich and successful and E&Y gives them trophies? Is this sort of commercial circle jerk really necessary? Regardless of our personal feelings, the awards are a big deal – Jay Leno hosted this year’s event for crissakes – and the Google News feed for E&Y is constantly clogged with stories about people advancing to the next round of voting like some sort of capitalist March Madness.

Anyway, Casa de Turley officially announced this year’s winners over the weekend and Reid Hoffman and Jeff Weiner, founders of Facebook for Suits LinkedIn, are your entrepreneuriest entrepreneurs.


In addition to the dynamic duo there are quite a few guys you’ve never heard of that are doing well for themselves including Roger Linquist and Jose R. Mas. See? Never heard of them, have you?

There are also some winners that you have heard of including Andrew Mason, one of the co-founders of virtual clipfest and increasingly looking insolvent Groupon. As well as Patrick Byrne, the founder of Overstock.com. You know, the guy on the Segway. The guy who Sam Antar can’t help to poke and prod every chance he gets. The guy whose company is being sued by seven California counties thanks to a Walmart sticker. The guy who may have had some weirdo trolling a bunch of bloggers’ Facebook friends. Yes, that Patrick Byrne.

But HEY! not every entrepreneur can be squeaky clean. It’s not like he’s Pete Rose or anything. Unless you count this.

[via E&Y]