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Private Equity
Behind the Buyouts: Houlihan’s Hughes on Accounting Firm M&A [The Deal]
On the latest episode of Behind the Buyouts, Patrick Hughes, head of accounting services at Houlihan Lokey Inc., discussed the state of accounting M&A in 2026 and the industry’s evolution from a largely untapped market to one where more than half of the top 100 accounting firms have private equity backing. Strong PE demand, long portfolio hold periods and improving macroeconomic conditions will support a significant wave of deal activity through 2027, Hughes added.
Stephano Slack Announces Strategic Growth Investment from Madison Dearborn Partners [Business Wire]
Stephano Slack, a premier accounting and advisory firm, announced a strategic growth investment from funds managed by Madison Dearborn Partners (“MDP”), a leading private equity investment firm based in Chicago, with additional participation from co-investor Norlantic Capital.
Municipal Madness
Riverhead official admitted to fabricating ‘independent’ accounting report, hearing officer finds [RiverheadLOCAL (New York)]
Riverhead’s longtime parks and recreation superintendent fabricated an “independent forensic accounting review” and falsely attributed it to an outside accounting firm in an attempt to persuade Town Board members not to eliminate his $8,000 annual stipend, according to a hearing officer’s findings obtained by RiverheadLOCAL under the Freedom of Information Law. Hearing officer Robert E. Draffin found that Coyne authored the accounting report himself, with the assistance of artificial intelligence tools, while representing it as an independent review prepared by Anthony J. Mancini, CPA, CFF, of Mancini Forensic Accounting & Advisory Group, PLLC.
Practice Management
AICPA Top Issues Survey: Firms’ focus on technology rises [Journal of Accountancy]
Change management related to technology, including the rise of artificial intelligence (AI), ranked as CPA firms’ leading issue by expected impact in the next five years, according to the latest CPA Firm Top Issues Survey.
Big 4
KPMG’s self-destruction puts Big Four on notice [Reuters]
Writes Antony Currie:
It’s so often the cover-up that gets you. Or in KPMG Australia’s case, such a botched attempt to deal with serious allegations from a company whistleblower that it came close to a cover-up. It’s only three months since accusations came to light that staff at the Big Four accounting firm used confidential information to win business. KPMG has now lost much of its senior management Down Under, including, this week, chair of both Australia and Asia-Pacific, opens new tab Martin Sheppard. Coming so soon after a PwC scandal, it ought to prompt an urgent overhaul of the industry.
PwC board moves to keep CEO Kevin Burrowes in charge until 2028 [Financial Review]
Burrowes, who was brought in by PwC Global to take control of the scandal-hit Australian firm in 2023, was due to be replaced later this year by a local leader. “[We] have told partners that the board believes continuity of leadership is in the best interests of the firm in this environment,” said PwC’s independent chairman, John Green.
Audit
Audit firm to Gupta metals empire fined and banned for ‘egregious’ failures [The Guardian]
King & King and its managing partner Milankumar Patel have been fined a total of £378,184, received a “severe reprimand”, and hit with serious restrictions on audit work after a four-year investigation by the Financial Reporting Council (FRC). King & King, whose main office is based above a row of shops in London’s Regent Street, relied heavily on fees from GFG Alliance companies, which made up nearly 41% of its revenues in 2021.
From Compliance to Competitiveness: Why audit chairs must lead integrated governance [Deloitte]
“The Audit Chair does not run the tower and should not try to. The contribution is a trained eye for crossing flight paths, and the standing to put them on the agenda before they become incidents.”
AI
‘Strictly Business’ at Cannes Lions: Deloitte, AWS and Sony Pictures Entertainment Execs on Getting Your ‘Hands Dirty’ With New Tech Like AI: ‘Start Tackling Hard Problems’ [Variety]
Thoughts from Deloitte’s Michelle McGuire, whose title is Chief Data & AI Officer (CDAIO) for the Deloitte US Olympic and Paralympic Partnership:
“I would say don’t be scared of AI and the technology, right?” said McGuire. “Start to upskill your folks so they engage with it, they understand it, they’re getting their hands dirty and using it.” Her advice is for companies to “start tackling hard problems” — so they can not only see the benefits of optimizing existing processes, but start to apply AI to do things that weren’t possible before.
CFOs lag in AI readiness as ROI pressures rise: EY [CFO Dive]
Seventy-one percent of CFOs say traditional metrics are not sufficient to evaluate initiatives that combine people and technology, highlighting a growing mismatch between how organizations create value and how it is measured, according to the EY report.
AI cost challenges mount as agent use gets more complex: KPMG [CFO Dive]
Deployments of coordinated artificial intelligence agents are growing, a shift that raises new cost visibility challenges for organizations, according to KPMG’s latest AI Quarterly Pulse Survey. While the share of organizations deploying AI agents remained largely steady from the prior survey period (53% compared to 55%), companies are increasingly managing more complex deployments that span teams, systems and decision points, KPMG found.
Deloitte adds unified agentic AI layer to Omnia audit platform [International Accounting Bulletin]
Deloitte has introduced a new agentic intelligence network within Deloitte Omnia, its global audit and assurance platform. These agents are intended to operate collectively to carry out full audit and assurance workflows rather than working as stand-alone tools.
Tax
Gavin Newsom urges a national ‘billionaires’ tax’ while fighting one in California [The Guardian]
Newsom argued that a state-level billionaire tax would be easily dodged by wealthy people who are able to move their assets to other states. Already, several billionaires, including Google co-founder Larry Page, have either threatened to leave California or made efforts to cut ties with the state. “You may not be able to pick up and move to Texas or Florida to shelter your income from taxation, but I promise you that billionaires can, and do,” Newsom wrote. “Wealth is movable, and it shops for the state with the lowest taxes. The fight belongs at the federal level, where this broken system was created in the first place.”
Trump threatens 100% tariff on any country that imposes digital services tax [Reuters]
“Numerous European Countries have been discussing the imminent implementation of a Digital Services Tax on American Companies,” Trump said in a social media post. “Some of these Countries are close to actually doing this. Please let this statement serve to represent that any Country that imposes such a Tax will immediately be met with a 100% TARIFF on any and all Goods sent to the United States of America.”
DOJ Civil Tax to Hire Attorneys After Losing a Third of Staff [Bloomberg Tax]
The civil tax branch of the Justice Department is hiring again after losing more than a third of its staff amid the Trump administration’s effort to downsize the federal government and revamp the department. The Tax Litigation Branch of the Civil Division now has 189 full-time employees, said Joshua Wu, deputy assistant attorney general overseeing civil tax, during a Friday panel at the New York University Tax Controversy Forum in New York.
