Category: Big 4

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

Ex-KPMG Senior Manager Convicted of Selling Tax Shelters Is 50% Less Poorer Today

A win is a win and the U.S. Second Circuit Court of Appeals handed one to John Larson, one of three defendants sentenced last year for selling illegal tax shelters. The Court “found Larson’s [$6 million] fine too high, citing a lack of jury findings to support a fine above $3 million. It returned that part of the case to the lower court to recalculate any fine.”


That’s more or less where the good news ends. The court did uphold the convictions of Larson and his two co-defendants – ex-KPMG Partner Robert Pfaff and ex-Brown & Wood partner Raymond Ruble. Larson was sentenced to a 10 year prison term last year. Pfaff received 8 years and Ruble 6-1/2 years.

Appeals court upholds KPMG tax shelter convictions [Reuters]

Deloitte’s New San Francisco Office Will Be Cooler Than Yours

Sayeth San Fran managing partner Mark Edmunds.


He told the SF Business Times, “The cool factor will be very high,” so maybe we’re taking his statement slightly out of context. Presumably, “high cool factor” not only means that there won’t be tight security on bathrooms and they’ll allow pictures in your respective cube but it sounds as though there will be a faux-Starbucks available and a theater so you can listen to Barry Salzberg talk about diversity in surround sound.

The new office — nine floors in San Francisco’s newest office tower — represents not only a change in address, but an evolving philosophical transformation in how Deloitte serves its clients. Instead of private sanctuaries where partners retreat to pore over financial statements, the new environment will be all about collaborative spaces, Starbucks-like cafes and enclaves with the latest video conferencing technology. There will be a theater-style “learning center” that can hold groups of up to 200.

Deloitte recalculates headquarters [SF Business Times (partial subscription required)]

KPMG Ireland Associate Pleads with U.S. Counterparts to Help Him and His Bros Win Ski Getaway

The good ole US of A is always here to help its friends in times of need (whether it’s right or wrong is another matter completely). This reverberates all the way down to the multi-national companies that enjoy expansive networks in the U.S.

Getting to the point: from the mailbag:

I (along with EVERY associate and senior associate in the US) got this email this morning from some idiot staff in KPMG Ireland asking us to vote for him to win a vacation courtesy of Coors Light. I’ve never heard of this guy but apparently thinks he knows all of us well enough to ask us to vote for his stupid beer vacation.

I kid you not — he actually looked up every associate and sr associate distribution list for every region/office and practice. He’s listed as a “Trainee” in the global address book under KPMG Ireland FS Audit (whatever that means). This idiot needs to be taught some email common sense…


But when matters of utmost importance – such as a winning a ski getaway to British Columbia – there is only one place to turn…The United States:

Hey everybody!

Me and 2 friends have entered a competition to win a free ski trip to Whistler, Canada. It just depends on who gets the most votes in a week. If you could follow the link and vote for us I’d really appreciate it.

http://www.coorslight.ie/destination/profile/cde76g7p

It only takes about 10 seconds and no registration / email needed. You just enter your D.O.B to enter the main site (or any DOB that makes you over 18) then just hit the ‘vote for us’ tab on our profile –
Ri-Skii Business. If you can forward this to some friends or contacts in your different offices it could really help to put us out in front!

Thanks!

Here’s the plea from the Ri-Skii Business page:

Idiot? Or sheer genius? We’ll let you debate that one. In any case, help the dudes out and go vote. They’re just looking for the next adrenaline rush.

There Are More Than a Few Texans Who Aren’t Impressed with Ernst & Young’s Auditing Abilities

And this has nothing to do with Lehman Brothers.

Attorneys from Houston’s Ahmad, Zavitsanos & Anaipakos are representing a group of investors in a lawsuit filed against hedge fund auditors Ernst & Young after the group lost more than $17 million following the collapse of a Plano, Texas-based hedge fund that promised low-risk investments.

The lawsuit focuses on two funds sold by Plano’s Parkcentral Global and was filed on behalf of Houston financial consultant Gus H. Comiskey and four Tucson, Ariz.-based entities, including the Thomas R. Brown Family Private Foundation. The now-defunct Parkcentral Global was operated by affiliates of billionaire and former presidential candidate H. Ross Perot before closing its doors after losing a total of more than $2.6 billion.

“Our clients were told that an investment in Parkcentral was designed to preserve capital. Instead, they lost every penny in record time. E&Y was supposed to be auditing Parkcentral, but the audited financial statements never once warned Parkcentral’s investors of their impending doom,” says attorney Demetrios Anaipakos, who will try the case with Amir H. Alavi.


Did you hear that E&Y? RECORD TIME! But why the Ross Perot mention, Ahmad, Zavitsanos & Anaipakos? Got something against eccentric Texas billionaires that like explaining complex things with charts? Sadly, the BPR does not elaborate.

The lawsuit includes claims that New York-based Ernst & Young falsely represented that the company fairly audited Parkcentral Global and the auditor failed in its “watchdog” [Ed. note: These quotation marks appear to be unnecessary. Also, the “watchdog” thing, sucks as metaphor.] role to warn relying investors of the risk of fraud and noncompliance by management. The suit accuses Ernst & Young of fraud, negligent misrepresentation, securities fraud and conspiracy.

This month, Brown Investment Management, L.P., one of the plaintiffs in this suit against Ernst & Young, won a Delaware Supreme Court ruling that requires Parkcentral Global to disclose its former investors. Those investors could be added to the new Houston lawsuit.

The investments of the Brown foundation, Brown Investment Management and the two other family-related ventures totaled $16 million and were lost within 90 days despite a “worst case loss” estimate of 5 percent. Mr. Comiskey, like his fellow investors, lost 100 percent of his investment when Parkcentral Global went under.

Mr. Anaipakos and Mr. Alavi have handled disputes against hedge funds and private equity firms for more than a decade. This lawsuit is separate from a class action filed in the U.S. District Court for the Northern District of Texas against Parkcentral Global.

Marin County Scrapping SAP System That Deloitte ‘Neophytes’ Slapped Together

Earlier in the summer, we told you about Marin County California, who was pretty displeased with Deloitte throwing a bunch of ‘neophytes’ at their ERP implementation project or in the County’s words ‘a trial-and-error training ground.’

As a result of Deloitte’s amateur hour, the SAP system – that Deloitte claims was just fine and dandy where they left it – is now being thrown to the scrap heap by the county because fixing it will cost more than replacing the whole system. And God knows Arnie won’t be helping them out with the bill, so they have to save on costs where they can.

The system is the subject of a lawsuit Marin County filed against system integrator Deloitte Consulting earlier this year. Deloitte used the project as “a trial-and-error training ground” for inexperienced employees, and the result was a “costly computer system far worse than the legacy systems it was intended to replace,” according to the county’s complaint.

Deloitte has filed motions against Marin County’s “completely unfounded allegations,” as well as a complaint seeking unpaid fees, a spokesman said via e-mail. The system “was working properly and could perform all the tasks consistently with the standards set forth in the written contract,” according to a Deloitte court filing.

Marin County tells a different story. The SAP implementation dates to 2006, but today only 50 percent of the functionality is in place and working properly, according to a county report.

The county hasn’t decided on who they’re going with for the new system but if you’ve got a one-person shop with no experience and present your RFP using overhead transparencies, you’ll still have an edge on Deloitte.

County will rip and replace ailing SAP system [Reuters]

Ernst & Young Partner Might Be Hiding Emmy Results Under His Pillow, Fails to Land Groupies

On Sunday, The Emmys will be handed out to several cast and crew of Mad Men and a few other people. In order to give these proceedings some legitimacy, Ernst & Young partner Andy Sale (and possibly a few others) counts these votes and certify the results.

The L.A. Times published a Q&A with Sale today since the big day is nearly here and we took the liberty of bringing you the highlights.


For starters, Andy understands that the MSM could really get two shits about accountants except when there are audit failures or celebrities involved:

How cool is it to walk on the red carpet?

It’s one of those things where for at least one day a year, being an accountant is something the press wants to shine a light on.

He also doesn’t appreciate the LAT’s presumption that being an accountant is boring:

Is it the one day of the year it’s fun to be an accountant?

I think it’s fun to be an accountant every day.

Cool fact: if one of the presenters is Mel Gibson-drunk and just blurts out a name that is completely wrong, Andy must sprint on stage give the presenter a roundhouse uppercut and state unequivocally who correct winner is. Fortunately, that has happened…yet:

Has anyone ever screwed up reading a winner?

Part of our role is to ensure the appropriate name is read onstage. If a name was omitted or read inappropriately, we would be duty-bound to go onstage and correct it. It’s never happened. We hope to continue that streak.

The security around these events has to be tight and Sale and the team have to keep things creative when hiding the results. That means the results could be anywhere – a vault, his underwear drawer, Jon Hamm’s pants:

Let’s talk security. After you’ve finished counting the votes, where do they go?

Where they are secured and how they are secured changes every year. It can be in a vault. It can be under a pillow. We have multiple sets of envelopes and those multiple sets of envelopes arrive at the Nokia Theatre by different means. For security reasons, I can’t divulge those specific means. They’re delivered by a means both conventional and unconventional, and that’s all I’ll say on that.

And as glamorous as this gig is, it still not getting Andy as much action as he would like:

Do you get groupies out of this?

I can’t say I’ve seen a lot in the way of groupies.

Andy Sale is counting on Emmy Awards [Los Angeles Times]

Deloitte Poll: One-Third of Companies Don’t Have the First Damn Clue About Business Analytics

You can try to blame the Obama Administration’s anti-business policies but you really only have yourself to blame. Get with it people.

Business analytics represents the ability to rapidly harness massive amounts of data for modeling complex situations and predicting potential outcomes and alternatives. This presents enormous potential value for business leaders to make more informed, fact-based and ultimately better business decisions. Yet, in a recent Deloitte webcast poll of more than 1,900 technology executives and business professionals, approximately one-third of the participants either didn’t know if their organization utilized business analytics – or even if they had business analytics capabilities at all.

“Mind-boggling,” said John Lucker, a principal with Deloitte Consulting LLP, leader of its Advanced Analytics and Modeling practice, and one of the webcast presenters. “Organizations have ever more depth and breadth of information readily available within their grasp, and the technology and methods to extract and help synthesize the data are well proven. When you see the low levels of adoption, you have to ask the question, ‘Why aren’t more companies doing it?'”

Deloitte Webcast Poll: One-Third of Organizations Have Limited or No Business Analytics Capabilities [PR Newswire]

Will the Big 4 Take a “Late Bloomer” with a Low Undergrad GPA?

Today from the mailbag we have a Big 4 hopeful that – like many of you – enjoyed the splendors of undergrad life to the detriment of their GPA and want to know if this will dash their Big 4 hopes and dreams.

If you’ve got questions about your career, a problem at work (romantic, political or otherwise) or what you should have for lunch, shoot us an email at advice@goingconcern.com. We will ignore pension accounting questions with extreme prejudice.

Back to our friend:

I just started an MSA program this summer after graduating with a BA in Economics. My cumulative undergrad GPA was 2.78, which is certainly not helping me attain my goal of Big 4 employment. I’ve been told that talking to recruiters now would be certain career death and I’m hoping on using the “late bloomer” story whenever I do begin the recruiting process. I can honestly say my attitude towards academics has improved tremendously over the past year or so. In the two graduate summer classes I’ve taken so far, I’m pulling a 3.85 GPA.

My question is, how long will it take for my improved academic performance to become substantial evidence of my matured academic attitude? Should I hold off on fall recruiting? Go for an internship instead of FT? Any advice would be greatly appreciated.

While a 2.78 isn’t the end of the world, you are correct in your thinking that most Big 4 recruiters will turn their nose up at you. That being said, talking to recruiters is not “certain career death.” Quite the opposite, in fact. The more face time you get with these Big 4 types, the more they will remember you. Your “late bloomer” story certainly holds water now but you admit that you’ve only taken two classes. If you can maintain the GPA, then great, you’ll be in good shape. And yes, recruiters will see this is as a positive direction. If you revert to your keg standing ways (some people never get over it) then hopefully your guessing skills on exams have gotten better.

In the meantime, here are a couple of things you can do to hopefully marginalize that 2.78:

• List your summer course GPA on your resume – leave the undergrad GPA off, but be honest if and when you’re asked about it.
• Major GPA vs. Cumulative GPA – We’re assuming the 2.78 is your overall, or cumulative, GPA. Calculate your major-specific GPA (the classes that differentiate you from another business degree) – if it is above a 3.0, list it on your resume.

The problem with your situation, Late Bloomer, is that you don’t know what the thought process of the Big 4 recruiters, employees and partners that you meet are. Some of them may love you and others will take one look at your undergrad GPA and will respond not with “no” but “hell no.” Typically when a recruiting team is split on a candidate, the hierarchy trumps and if you didn’t impress the pants off that partner, you’ll be out.

Considering all that, you should absolutely attend the fall recruiting events and meet as many different firms and make as many contacts as possible. Also, be realistic with them – it’s okay to admit that you faltered a bit during your undergrad – just know that you’re going to have to prove it to them in the long run that you can keep things on the up and up.

Whether or not you should go for an internship or FT is your call. Will you be graduating in spring or summer of ’11? Then going for full time is probably the best move, regardless of the not-so-stellar undergrad GPA. If your MSA program can be stretched out, go for the internship. Even if you don’t get it, you’ll make plenty of contacts in the Big 4 so that when recruiting comes around for next year, you’ll be a familiar face and the recruiters will get a sense that you’re committed to academics and that you are a solid candidate for their firm.

Deloitte Highlights Its Non-monetary Commitment to Its Talent Via Hexagon-Filled Report

Deloitte officially rolled out its Talent Annuity Report today and before you start wondering just what the hell a Talent Annuity Report is, Barry Salzberg enlightens everyone:

We published a Talent Annuity Report because we regard our talenhat generates an annuity. We take pride in the contents of the report — it is a tangible manifestation of our passion and commitment to our talent. Our people are vital to the continued growth of our business, and we are focused on fostering a quality culture where everyone has the opportunity to reach their fullest potential.

Everything Dr. Phil says may in fact be true, however when we look at the report, we see a lot of indecipherable hexagons that may or may not be used to communicate this “passion and commitment to [Deloitte’s] talent.”


Fortunately, if you’re not too interested in navigating through the geometric maze, the press release manages to break down why it was such a bang-up year for the talent at Deloitte:

The report chronicles a year of bold talent initiatives and historical milestones including:
• Groundbreaking of Deloitte University, a $300 million state-of-the-art center established to foster personal and professional growth at Deloitte

• Company-wide rollout of Mass Career Customization® , a career development model that enables all Deloitte professionals to dial up and dial down their careers to fit their needs at various life stages

• Launch of a voluntary sabbatical program for employees to take up to six months leave to engage in volunteering and other personal pursuits

• Presentation of Deloitte’s cutting-edge corporate lattice business strategy in a new book titled “The Corporate Lattice: Achieving High Performance in the Changing World of Work“

• Introduction of a customized approach to talent development with Deloitte professionals participating in 2.4 million learning hours

• Achievement of the 1000+ mark for women partners, principals and directors — a reflection of Deloitte’s hallmark Women’s Initiative and commitment to an inclusive environment.

• Recognition from more than a dozen national organizations, including the No.1 ranking on BusinessWeek’s “Best Places to Launch a Career” list

Whether or not spending $300 million to build the Deloitte frat house is worth it, is a matter of opinion.

As for BusinessWeek lists and whathaveyou, most employees understand that this perpetual conclusion is for marketing purposes and would be more than happy to take exception with it. As for the rest of the initiatives and milestones, you can take them for what they are worth.

But what’s especially interesting is the timing of this release. These non-monetary reasons are presumably supposed to serve as reminder of Deloitte’s commitment to employees. But since the report was issued in wake of the merit increases we saw last week, it’s almost if it’s meant to console employees after the relatively disappointing news. And if that is the case, it will fail miserably.

Deloitte Releases Talent Annuity Report [PR Newswire]

Deloitte Donates $500k to Seminar Where Professors Nerd Out on Complex Accounting Issues

Joking, joking, joking. Actually it’s the American Accounting Association Robert M. Trueblood Seminars for Professors and it sounds as though it’s a pretty important little get-together.

Launched in 1966 and sponsored by the AAA, the Trueblood Seminars is a two and one-half day session where attendees share and examine complex accounting and auditing case studies. The program’s objective is to offer professors some perspective on present day accounting issues from the viewpoint of the auditors and preparers of financial statements. Each seminar features multiple case discussions led by Deloitte & Touche LLP partners, an open forum discussion on professional issues and developments in practice, as well as an update on the standard-setting activities of the Financial Accounting Standards Board (FASB). More than 2,000 professors have attended the Seminars since the program’s inception.

As long as Barry Salzberg isn’t having a free-wheeling discussion about diversity, then we’re all for it.

Deloitte Foundation Renews $500,000 Commitment to Continuing Education for Accounting Professors [CSR Newswire]