When accounting goes unaccounted for
If it happens at a Big 4 accounting firm, we’re talking about it here.
What the hell is in the water today?
FYI – “Select” resources in Northeast Advisory are getting notified that they will be getting a small holiday bonus (ranging from $500 – $2000) in their next paycheck.
Happy Holidays 🙂
If you’re not “select” feel free to get Grinchy in the comments and if you are, then go but an iPad.
This just in:
PwC West Coast just got issued the increased spot bonuses you talked about in this article:
[Bonus Watch: Pre-Turkey Spot Bonuses at PwC?]From what I have gathered, they were either $1,500 or $2,000 in amount. (I have talked to several peers about this)
This is in addition to chatter we heard last week about bonuses being awarded in New York. If your city’s office is spreading the holiday cheer, discuss below or email us the details.
UPDATE, Thursday circa 11:00 am: Another tipster begs to differ on the amount:
I haven’t checked my paycheck yet- but my bonus sure as heck wasn’t $1500-$2000. I was told I was getting about $800.
Hard to believe it’s almost been two weeks since we mentioned alleged insider trader/justice obstructer/swinger app developer Annabel McClellan but time sure flies when you’re facing criminal charges, amiright?
Annabel made an appearance in criminal court yesterday but sadly, her husband and alleged insider trading conspirator, Arnold, was nowhere to be seen. You could probably conclude that someone has to watch the kids, since no one in Pacific Heights is interested in being associated with the couple at this point.
[O]n Tuesday, Annabel McClellan was very much alone in court. Previously, she surrendered her British passport and posted $250,000 bail. If convicted of the obstruction of justice charge, she could face five years in prison. Potential damages in the SEC case could exceed $90 million.
Nanci Clarence, Annabel McClellan’s attorney, told U.S. District Court Judge William Alsup that she would need several months to adequately review the documents that U.S. federal prosecutors have handed over. As of Tuesday, the number of documents stood at 47,000.
While it’s pretty unlikely that My Nookie, the aforementioned mobil app that appears to be a Wheel of Position Fortunes, gets much attention in the documents, we can always hope. The fact that this will keep the McClellans tied up in court for months and maybe years to come, goes without saying but Ms. McClellan’s attorney – acting in her client’s best interest – opted to go there:
“This is a fairly complicated matter,” Clarence explained to Judge Alsup, who will also be presiding over the related SEC case against both McClellans. Additionally, Clarence said, there are “very extensive parallel proceedings in the United Kingdom. That proceeding [will] generate its own extensive discovery” of evidence. Assistant U.S. Attorney Adam Reeves, who is prosecuting the case, did not object to the delay.
As everyone agreed on April 5 as the next court date in the case, Alsup addressed McClellan, dressed all in black, who had stood quietly before him for the duration of the hearing, saying, “Ms. McClellan, welcome to the court. See you back in April.”
*Photo: Drew Altizer Photography via The Bay Citizen
As previously discussed, a few people are getting impatient with the lack of mid-year comp surprises at Ernst & Young and KPMG. While KPMG seems to be chewing on the idea, we couldn’t help but notice the lack of any word out of E&Y.
We had concocted several scenarios, including the firm paying people large bonuses in exchange for absolute silence but we immediately dismissed this idea as “idiotic” since Big 4 types can’t resist getting chatty when it comes to money. But the lack of kvetching is what we found to be most perplexing.
Until today that is! Finally, someone has had it with the efforts (or lack thereof) of E&Y in response to Deloitte, PwC et al. We may wrong but since there’s less than two shopping weeks left until Jesus of Nazareth’s birthday, people are, as is typical, a little irritated (something which, we’ve never really understood, this is a great time of year). Case in point – the observations we received from “Ernie Guy” in the midwest:
I recently read your article discussing the fact that E&Y and KPMG are lagging in their variable pay efforts. Well E&Y Midwest thinks they have solved the problem, but they haven’t. It seems that their response to PWC’s recent generosity is simply more of the same. They have “enhanced” the recognition program so that gift card awards can be given in more denominations (instead of just $50 or $100 they can now be $50, $150, $200, $300, $400, or $500). However, this doesn’t seem to do much as the next level of award already was eligible for $500-$2000 amounts.
It’s a completely ad hoc process anyway, and does not at all ensure that high performers are rewarded for their work. On top of it all is the fact that I’ve heard that many award nominations have been pending approval for the last month. How great would that be if a bonus meant for Christmas (and remember, they are mostly gift cards, which would be ideal for Christmas shopping/gifts) doesn’t arrive until January 17th!
Needless to say, I AM ANNOYED.
Thanks,
Ernie Guy
We’d add more here but it doesn’t seem necessary. Discuss the efforts of E&Y to date and if there is a pleasant holiday surprise coming your way, email us the details.
From the mailbag:
Hey Caleb,
Was with a [Midwest city] KPMG Advisory partner this weekend. She said that employees are dropping like flies because KPMG finally unveiled raises after 2 yrs without. Only EP’s were awarded (less than 5%). She said the numbers were in the double digits. What the hell did they expect?
If this sounds a little confusing, it was. We asked our tipster to clarify:
[A]re you saying that she’s under the impression that people are just now leaving because they are upset that they didn’t get raises for two years? And she’s surprised because the raises in the double digits when they were actually in the single digits?
And their response:
[S]he is surprised that so many are leaving especially given the unemployment rate in [midwest city] regardless of how long it’s been since raises were given. It’s not a secret that the other big four have not only given raises but as you report, awarded mid-yr bonus/raises as well.
We went back to some of this year’s KPMG comp threads and the 5% sounds a little suspect, as those rated as “exceptional” were pulling much better increases than that but then again, maybe there were some exceptions that weren’t reported. Also, it seems a little strange that a partner would be so clueless about raises but anything is possible, s’pose.
And as far as the gnashing of teeth because mid-year raises and bonuses are being handed out at other firms, keep in mind that KPMG isn’t even out of their first quarter yet. The rest of those firms have fiscal years that end prior to KPMG’s and they know how the first half of the year is shaping up. Expecting KPMG to start throwing money at people with less than three months in the books is a little ridiculous. At this point, the rumors around the idea of a mid-year surprise should keep you hopeful (but don’t go expecting anything).
It’s been no secret that people have exiting the House of Klynveld (and other firms) – regardless of the unemployment situation – prior to the end of the year (as is typical this time of year). Frankly, people we talk to are pretty optimistic about the job situation for most Big 4 types looking for something new, so this partner may be even more clueless than we thought.
Whatever the case, only 17 shopping days until those left will likely settle for sitting tight through another busy season. If we’re way off base here (or right on the money), feel free to jump in.
Because we’re more or less a family here at Going Concern, when someone needs our help spreading the word about anything from compensation news to winning a ski getaway, we’re happy to help.
Today’s accountant-in-need is Larry Chou (a partner who was desperate for a pianist, basically challenged his entire office to step up to the plate and, ultimately, had his prayers answered.
ANYWAY, as you can see, Larry has bigger fish to fry. Here’s his audition:
He also passed along some instructions just so you can get this ball rolling:
How do I vote?
1) It only takes 5 seconds! Between December 10-17 (inclusive), please follow the link below to watch my video and vote for Larry Chou (lchou008). You may have to scroll halfway down the page to get to my video.
(Note: You do NOT need a Youtube user account to vote. Just follow the link!)
I’ve voted…now what?
2) Vote some more! The voting period extends from December 10-17, and you can vote once every day. That means you can vote 8 times if you remember to do it every day. This competition is on Eastern time, so each “voting day” on Pacific time technically runs from 9pm to 8:59pm of the following day. Additional votes from the same user on the same day are thrown out.
3) Check out my Facebook group page or my Facebook fan page.
4) Spread the word! I’m going to need every man, woman, and child to get in on this. Tell your friends, your family, your significant other, your co-workers, your classmates, your barber, your gardener, and your waiter/waitress! Just kidding (but not really, I’m going to need all the help I can get).
Thank you for your support!!
Well. What are you waiting for? ‘Tis the season to help other people out or something or other.
Welcome to the aren’t-you-glad-healthcare-reform-is-back-in-the-news? edition of Accounting Career Emergencies. In today’s edition, should an incoming associate expect a salary adjustment on day one or they doomed to a pittance?
Find yourself in a jam at work? Do you have eight hours to spare and aren’t sure how to best spend this rare free time? Wondering what you should get Sharon Allen for a retirement gift? Email us at advice@goingconcern.com and we’ll make sure you stay away from vacuum cleaners.
Returning to our Big 4 in waiting:
Can I expect to have my salary adjusted to market when I start employment? I will be starting in 2011. Reading through some of the articles and comments on here, it seems that new hires easily start with a salary above $50K. I received three offers from three Big 4 firms but all offered salaries were relatively far from $50K.
Each firm was within 1K-1.5K range from each other though. I know that starting salaries have even decreased in my area overall. I am not enjoying the thought of making less than what these firms have proven to have the potential to offer, or even making less than what another firm had to offer (although I knew that was the outcome by choosing this firm). I personally do not think it is worth asking for a raise or a salary adjustment since I feel that would only hurt my future annual raises. Should I just wait it out and see?
[Doubled over, catching breath, holding up hand with ‘I need a minute’]
Oh, dear. We had to take a break for a second, in fact our face hurts from laughing uncontrollably. Sorry about that.
Look friend, we don’t mean to make light of your question but a reality check is necessary here. There is virtually no chance that your firm will adjust to your salary when you start. You write, “I am not enjoying the thought of making less than what these firms have proven to have the potential to offer, or even making less than what another firm had to offer (although I knew that was the outcome by choosing this firm).”
We find this confusing for a couple of reasons – 1) obviously the Big 4 have “proven to have the potential” to pay more than $50k. It just happens this is occurring in a place where you don’t currently reside. If you did reside in one these places, your starting salary would eclipse the magical $50k. Were you expecting a big city salary for your mid-sized city lifestyle? 2) if you don’t like the idea of earning less money, why did you go with the firm that offered you less money? This simply doesn’t compute.
If making $50,000 is such a sticking point for you, move to a city with a higher cost of living so that you can eclipse the magic number you so desperately desire. If that’s not reasonable, then the best you can hope for is a pleasant surprise like PwC gave its recently hired peeps ($500 bonus for those hired post-June 30, 2010).
This may sound crazy but don’t get too caught up in what your salary is at the beginning of your career. So, to answer your question – sit tight and start your career. It’s a little early to be bitching about being underpaid when you haven’t billed a single hour.
Most people choosing the art of debits and credits as a career path, likely had aspirations for working for one of the illustrious Big 4. Fame, prestige, working with only the finest accountants that Omaha Steaks can buy, are all par for the course. This has been accepted as truth for many years.
But now – if you can believe this – this truth is being called into question in the UK – a part of the world that you might not expect.
Accountancy Age reports that a recent survey has found that young accountants (less than three years experience) are not as hung up on working at a Big 4 firm:
Only 40% of accountants with less than three years’ experience surveyed by recruiter Marks Sattin said it was important to work for a big firm — compared to an average of 67% for all of the 450 accountants surveyed in practice and industry.
“We are entering a new era in financial services…in which candidates want to sell themselves not by reeling off lists of FTSE 100 clients, but on their experience on smaller accounts providing higher levels of responsibility,” said Laura Wilson, associate director of the professional services division at Marks Sattin.
Granted, this is the pulse of the UK but there’s always been a large firm vs. small firm debate and this a trend that makes its way to the States (if it hasn’t already).
The reason for young accountants’ attitude, it turns out, is that they don’t care if they are working on prestigious clients; they are looking for more expansive professional experience:
“Whether it’s true or not, candidates think they’ll be doing work that is more involved at an early stage in their careers by joining a smaller firm. The perception is counting against the Big Four because candidates think that smaller firms offer more variety and more autonomy – and candidates are increasingly willing to sacrifice exposure to the FTSE 100 to get it.”
According to one person quoted in the article, part of this is a generational attitude but we’re not convinced that’s entirely the case. Sure, Gen Y wants to have more responsibility as quickly as possible but it’s not as though the Big 4 are taking on the same number of new recruits each year. As a result, a competitive recruiting process has made smaller firms a very good option. Plus, news about layoffs and a slow climb up the corporate ladder at the largest firms might have some students looking for opportunities.
Make no mistake, working at a Big 4 firm will always be goal number one for a lot of students and young CPAs. Regardless of what any survey says, many still have ambitions to be a partner in one of the largest firms or to work in some of the world’s prestigious companies. But the more informed students and young professionals are about career options, the perceived need for Big 4 experience on your résumé will be less compulsory.
Young accountants shun Big Four firms [Accountancy Age]
~ Update includes email sent to all KPMG employees and further details on communication within PwC.
Confirming some chatter in last Friday’s post on the banishment of WikiLeaks at Deloitte, notification at Grant Thornton was sent out late on Friday.
So not even after a long, hard day doing Stephen Chipman’s lowed to read catty messages between diplomats or war logs on your personal computer. What’s next? Firmwide emails instructing lonely accountants not to visit Fleshbot (NSFW)?
Personal time aside, judging by the conversation on the Deloitte post, it appears that KPMG has also communicated ‘no peeky at wiki’ but we haven’t seen the official communiqué. And since all the major firms have contracts with the Feds, we decided to call around to see find out the scoop. So far, a source at PwC did inform us that the WikiLeaks website is accessible but no official policy on accessing the site has been communicated to the firm at large.
[UPDATE: We have learned that PwC’s Washington Federal Practice did receive communication prohibiting access, downloading, etc. etc. to WikiLeaks, however, as we’ve updated above, a firm-wide communication was not sent.]
Messages with E&Y and KPMG were not immediately returned. If there has been official lines have been drawn in the cyber-sand, kindly email us with any communication.
Earlier:
What if Accounting Firms Had Their Own Version of WikiLeaks?
UPDATE: The message from KPMG, courtesy of the sagacious Judge Sven Erik Holmes:
Date:December 10, 2010
To:All KPMG Personnel
From: Sven Erik Holmes, Vice Chair, Legal and Compliance
Subject:Government Notice Regarding Web site AccessPLEASE DO NOT DELETE THIS E-MAIL WITHOUT READING
In response to the recent well-publicized release of government documents on the WikiLeaks Web site, the federal government has begun notifying its contractors regarding restrictions on accessing classified documents included in that release. As a provider of services to several federal agencies, KPMG is a federal government contractor and has begun receiving such notices from its federal agency clients. This e-mail contains important instructions regarding access to such classified information, which are applicable to all firm personnel.
KPMG personnel should not access information marked or labeled as classified (including material publicly available on the WikiLeaks Web site or other Web sites) using government or KPMG computers or other devices that access the Web (such as PDAs or Smartphones) as doing so risks placing material that is still classified on non-classified systems. This restriction does not limit employee or contractor access to nonclassified, publicly available news reports (and other nonclassified material) that in turn reference classified material, as opposed to the underlying classified material itself (whether or not in the public domain).
The government’s notices remind us that federal contractors are obligated to protect classified information pursuant to all applicable federal laws, and to use government information systems, whether classified or unclassified, appropriately. Unauthorized disclosures of classified documents (whether in print, on a blog, or on a Web site) do not alter the documents’ classified status or automatically result in declassification of the documents. To the contrary, classified information, whether or not already posted on public Web sites or disclosed to the media, remains classified, and must be treated as such by federal employees and contractors, until it is declassified by an appropriate U.S. government authority.
If you believe that you may have downloaded classified information to a government or KPMG computer or other device that accesses the Web (such as a PDA or Smartphone), please contact [a KPMG lawyer who will ask you a ton of questions and probably scold you] in OGC at [lawyer’sname]@kpmg.com.
KPMG personnel are also reminded that firm policy requires personnel to maintain the confidentiality of any information that they obtain from a client in connection with a client engagement. It is important that the confidentiality of any such information be maintained.
Funny how slow TPTB were to react this (message is dated today). Assange isn’t even haunting our dreams any more. Nevertheless, NO. PEEKY. And if you’ve already taken a look, you need to report yourself, ASAP.
ALERT: New federal government guidance on accessing or downloading classified information
Published: 10-Dec-10
The following is a message from [redacted], chief quality officer.
In the wake of the recent WikiLeaks disclosures of U.S. classified information, the U.S. Office of Management & Budget (OMB) and the Department of Defense (DoD) published guidance that prohibits federal government employees and federal contractor personnel from accessing the WikiLeaks website to view or download classified information. As federal contractors, the Deloitte U.S. Firms and their professionals are obligated to protect the integrity of classified information.
This notice is designed to facilitate compliance with the OMB and DoD guidance. All personnel should note the following:
Despite the unauthorized public disclosure by WikiLeaks, the information disclosed retains its classified status. The decision to remove classified status must be rendered by a government classification authority. In short, the information remains classified in spite of any public disclosure.
The access or download of classified information could be determined to be a security violation that requires immediate remediation, including removal of such information from our systems. A security violation could pose risks to the operations of Deloitte’s Federal practice and could negatively affect our client service capabilities.
You should not attempt to access the classified information on the WikiLeaks website or any related website. If you previously visited the WikiLeaks site or any related website to view or download classified information, you should immediately report a “Federal DOS Incident” via 1 800 Deloitte (option 5).
If you possess a security clearance, keep in mind that you are personally obligated to uphold the requirements for appropriate handling and dissemination of classified information, as outlined in your respective Classified Information Non-Disclosure Statement.
If you have any questions, please send them by e-mail to [redacted: presumably someone inside Deloitte who is familiar with these sorts of things].
[redacted]
Chief Quality Officer
Deloitte LLP
We were a little surprised to learn that both KPMG and PwC had brief mentions in the WikiLeaks cables, however it is far less surprising that they were quite humdrum and didn’t bring anything new to light.
[…]
Wikileaks also published (09LONDON2598, for official use only, originating from U.S. Embassy in London, created November 11, 2009) KPMG’s sceptical reaction on the Queen’s opening speech in Parliament on November 18, 2009, where Her Majesty sets out one of the priorities for new legislative session – to develop a new Financial Services Bill, requiring form systemically important banks to establish plans for recovery and resolution, that ensure banks’ financial continuity, later called by journalists “living wills”.
Like we said – meh.
Now, what happens within a Big 4 or other large accounting firm is rarely a matter of national security (Francine may disagree with us) but there’s little doubt that firm CEOs, partners and other notables have said things that would range from the slightly embarrassing to the absolutely mortifying. Consequently, reactions to those statements would also range widely from mere chuckles to ”OH NO YOU DI’INT!” Because our imagination has a tendency to run wild, we’ll dispel a few of our own scenarios that we imagine being in the Big 4/mid-tier version of WikiLeaks:
• Prior to the unveiling, Bob Moritz emails Tim Ryan, “Between you and me, the new logo looks like a half-finished Lego™ project.”
• Barry Salzberg and Jim Quigley are known inside some Deloitte circles as “Team Propecia.”
• After the OT loss to Michigan State, John Veihmeyer is so upset that he sends an email to Henry Keizer stating, “THAT’S IT! NO RAISES THIS YEAR.” Keizer responds to JV, reminding him that ‘if that punk Jimmy Clausen had stuck around’ they wouldn’t be in this situation and he shouldn’t take it out on the firm’s employees.
• Emails between two Ernst & Young partners in Jericho, reveal that they’ve been hoarding the extra bathroom keys because they can’t stand asking the receptionist.
• Various Deloitte partners are quaking because it is common knowledge that Arnie and Annabel McClellan have an elaborate spreadsheet detailing their various fetishes.
• In numerous exchanges Stephen Chipman begs Ed Nusbaum to let him ‘drop this ridiculous accent’ just like Ross did on Friends.
• High-level executives at McGladrey considered putting ecstasy in the punch so people would be happier but ultimately decided against it (Phoenix/Vegas went their own way) because it would have resulted in too many accountants dancing for no apparent reason.
• Jack Weisbaum = The Most Interesting Man in the World. (Just like several actual WikiLeaks, everyone knew this to be true but it was not discussed openly.)
Perhaps you have your own theories or documentation regarding other exchanges. Please share with the group at this time or email us.
Sharon Allen has spent 38 years at Deloitte. Doing the math on that, it probably feels more like a millennia. Accordingly, Ms. Allen has decided to hang up her green dot and chillax in Pasadena (Q&A with Accounting Today and we’ve picked out some of the highlights, including yes, a par-tay.
For starters, Sharon is a closer!
It’s a good time to leave when you’re on a high. I feel very confident in future leadership and the direction of our organization, and I think it’s just absolutely the right time to turn the reins over to others and proudly watch them continue to lead the firm in a good direction.
There will be a retirement rager, natch.
I’m going to have a big party. Yes.
Retirement will involve quality time with the hubby (but not so much that he goes nuts) and leading the Village People.
First of all I plan to spend a lot more time with my husband, family and friends, but of course there will probably be a limit on how much togetherness he can stand.[…] I have already committed to becoming the chairman of the board of the national YMCA board, which is an organization I’ve been involved with for over 25 years. I’m sure I will find ways to keep productively busy.
In case you weren’t aware, she doesn’t have a Y chromosome.
I am proud of many firsts that are in front of the titles I have carried. I was fortunate to be the first woman to become an office managing partner, the first woman to become a regional managing partner, the first woman to be elected to the board at Deloitte, and that’s been some years ago now. But I have to say my proudest accomplishment, I believe, was to have been elected as the first independent chairman of Deloitte’s board of directors. We separated our chairman and CEO role and created a full-time independent executive chairman of the board. It is an elected position by our partners, and I was very proud to be elected to that role. I always say, “Oh, by the way, I’m a woman.” It’s a very important distinction for me.
She’s more like you than you think – she got passed up for a manager promotion because her supervisor was clueless!
[P]erhaps one of the most important challenges that I had as I was coming up through my career also turned out to be one of my best lessons. That was when I was about four years into the firm and I expected an early promotion to manager, and I was passed over for that promotion. Interestingly, as I walked into my supervisor’s office and clicked off all the reasons why I thought I should have had the promotion and had earned it, he kind of sat back in his chair and looked at me and said, “I didn’t even know you did all those things.”
What about this boys club mentality?
I do think that there still is an underrepresentation of women in senior leadership in business generally and certainly in the board room of corporate organizations today. I do believe that organizations need to examine how they are recruiting, how they assure women are proportionally given the best assignments.
You know, back in the day, we basically had to come to work in drag.
There is a very big difference between today’s women and women of my era when I started in the profession because, in those days, honestly, you almost had to pretend there were no differences. I came up in the business world of wearing a suit and a little bow tie and trying to dress like the men and, of course, fortunately, men and women both can acknowledge the difference and benefit from that.
Leave Sharon your well wishes (or food and entertainment requests) below and if you get invited to this party, email us the pictures.