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PwC Vets Finalists for Top Job as Industry Meets AI, Gen Z Era [Bloomberg Tax]
PwC’s next leader will confront the challenges of rapidly advancing technology, recruiting and training an evolving workforce, and keeping up with the needs of its core accounting clients. The incoming generation of workers expects to see a diverse slate of top leaders. They want to refuse to work for certain companies on ethical grounds. They look for mentors to help them quickly scale the corporate ladder, said Alison Taylor, associate professor at NYU Stern School of Business. “Senior leadership is not prepared to put in place the kind of leader that will keep these young people happy,” Taylor said. “Senior leaders want to cash out and don’t want to make the difficult decisions. But there is more and more and more pressure coming from young graduates to do that.” Dialing back diversity and inclusion efforts or climate commitments could put “leaders on a collision course with their younger workers,” she said.
Oh boy, it turns out that there's a shortage of production accountants in the entertainment industry, which means that there's a great opportunity for people who love crunching numbers and are willing to sell their souls to Hollywood for a paycheck. #SoLucrative…— Joe (@JoeMaristela) January 17, 2024
Disney, Film Financing Partner TSG Settle Lawsuit Over “Hollywood Accounting” [Deadline]
Disney and TSG Entertainment Finance have settled litigation from August of 2023 when the financier sued the media giant for “rampant self-dealing” and breach of the parties’ revenue participation contract. “The matter has been resolved,” said a Disney spokesperson. TSG’s lawsuit filed last August in Los Angeles District Court said that Fox had promised TSG a share of defined gross receipts for pictures under the companies’ long-term participation agreement but that the studio used “nearly every trick in the Hollywood accounting book” to not pay. The financier accused Disney/Fox of self-dealing with FX, Hulu and Disney+, said its revenue began to shrink and that an audit it commissioned showed breaches of contract. It didn’t specify which films were examined.
Clip from Davos for you:
Two takes on the PwC CEO survey.
PwC CEO Survey: Sustainability Takeaways From Leading Execs [Sustainability Magazine]
PwC’s Global CEO Survey, launched on the first day of Davos, chimes with this executive sentiment – revealing that chief executives are less concerned about short-term worries like inflation and economic growth in 2024 (expectations for growth are up this year) – but are more worried about the long-term impact of climate change and AI on their business. A higher proportion of the 4,700 CEOs surveyed this year (45% compared to 39% last year) say that in the face of climate disruption and AI, they think their company will not last a decade without reinvention.
Generative AI is miracle technology for profit-hungry CEOs: PwC survey [Yahoo! Finance]
Step aside, CFOs: New generative AI technology stands to supplant you as your CEO’s best friend. This, in part, reflects how the latest crop of powerful tech can unlock major impact on worker productivity and corporate financials, according to a new study of CEOs by consultancy PwC. The survey was released ahead of an AI-themed World Economic Forum kicking off on Tuesday in Davos, Switzerland. About 68% of US CEOs surveyed say that the next 12 months will see generative AI increasing the amount of work that employees can accomplish. That number is 64% globally, according to PwC. Roughly half of US CEOs expect the technology to help them become more productive in their own work.
Protecting tax accounting information: Best practices for IT professionals in data security and confidentiality [Thomson Reuters]
Accounting firms are entrusted with a wealth of sensitive financial data, including tax records, income statements, and other confidential information. Any compromise in data security can lead to severe consequences, including financial losses, legal implications, and damage to the firm’s reputation. That’s why implementing robust data security measures is not only a compliance requirement but also a critical piece of maintaining client trust. Intensifying this need is the fact that most accounting firms rely heavily on tax and accounting software for their daily workflow, making the data that flows through these systems potentially vulnerable. As technology has evolved, the risks associated with data security have also become more prevalent.
ICYMI | Get Ready for the Future of Auditing [CPA Journal]
The increasing use of technology is changing how businesses operate, which methodology and technology auditors use, and what career paths they follow. But the future of audit is not only digitization and automation but also the increased interest of stakeholders—employees, investors, and customers—in an organization’s sustainability positioning, thinking, and actions. The demand for reporting to better understand a company’s performance and related risks is being coupled to technology to accelerate change in the audit profession.
Which One of You Was This?
When my accountant dumped me during tax season, it was a blessing in disguise [Business Insider]
Getting the sneaking suspicion there’s more to the story here.
I’m an accountant’s dream. Really. I get my tax documents in early. I do all of the calculations myself. I have color-coded spreadsheets with itemized lists of income and expenses. And I pay on time — my accountant and the government. So, when I logged into my email account one mid-February morning in 2022 to read that my accountant of almost 10 years was unceremoniously dumping me, just days before I’d planned to submit my tax documents, I was stunned. I was livid when my accountant ditched me. They cited staffing issues and capacity challenges as the cause of the breakup. OK. Fine. Fair enough. But wouldn’t they have known about these issues, say, in January?! Or even December? I have a low tolerance for only just meeting deadlines, never mind submitting things late. That’s not my MO. This was a disaster! They were pawning me off on another accountant to make room on their plates to handle their more high-profile clients. I was small potatoes. Never mind that I made quick work for them every year. Rather than allow myself to be handed over to another accountant of their choosing, I immediately reached out to my financial planner, who gave me a few leads.
Accountants Behaving Badly
Former WFYI accountant and co-conspirator sentenced for embezzling more than $270,000 [Current]
Two co-conspirators who schemed to embezzle funds from public television station WFYI in Indianapolis were sentenced Tuesday, according to a news release from the U.S. Attorney’s Office in the Southern District of Indiana. Mindi B. Madison, a former accountant for the station, pled guilty to conspiracy to commit wire fraud in April 2023 and was sentenced to three years of probation. She is ordered to pay $270,876 in restitution, the amount that was embezzled.
Fort Lauderdale accounting firm owner accused of tax fraud [SunSentinel]
The website for Jose Coss’s accounting business in Fort Lauderdale tells would-be customers, “you can trust us.” A Wilton Manors Police investigation found they couldn’t. Coss, 54, was arrested Tuesday and is held in the Broward Main Jail on 18 charges stemming from an ongoing Internal Revenue Service tax fraud investigation. He owns Coss Bookkeeping & Accounting and is the registered agent of numerous other businesses, state business records show. Coss, in his position as a tax preparer, took clients’ personal information and filed tax documents with it but diverted their money into one of many bank accounts he controlled, Wilton Manors Police said in a news release Wednesday.
Bakersfield CPA Sentenced to 15 Months in Prison for Stealing $355,000 from Investors [DoJ]
Jeffrey Todd Stewart, 58, of Bakersfield, was sentenced today to 15 months in prison for stealing $355,000 from investors, U.S. Attorney Phillip A. Talbert announced. According to court documents, Stewart was employed as a certified public accountant in Bakersfield. Between September 2014 and June 2018, Stewart solicited and received over $2 million from investors to pay fees and expenses purportedly needed for an overseas business deal. Stewart represented to the investors that their investments were being used for the deal and promised significant returns. Although Stewart used most of the money for the purported deal, he spent $355,000 of the money obtained from the investors on his own personal expenses, including mortgage payments, trips to Las Vegas, and gambling.
Trinity Hunt Partners Announces Formation of Springline Advisory and Welcomes CEO Tim Brackney [PR Newswire]
Springline was initially formed through a partnership with MarksNelson, an “IPA 200” accounting and advisory firm headquartered in Kansas City. Backing Springline is Trinity Hunt Partners, a growth-oriented middle-market private equity firm with deep expertise in business and professional services companies.
Arizona Auditors Found $1.8 Million in Fraud and Theft in 2023 [Arizona Mirror]
State audits uncovered more than $1.8 million in theft and fraud in 2023 and led to nearly three dozen criminal charges. In a year-end report, the Arizona Auditor General outlined a series of criminal acts that the agency’s investigators discovered during routine audits, including one state worker who allegedly siphoned more than $1.7 million from an education program.
IRS selects 12 new IRSAC members for 2024 [IRS]
The IRSAC, established in 1953, is an organized public forum for IRS officials and representatives of the public to discuss a broad range of issues in tax administration. The Council provides the IRS and agency leaders with relevant feedback, observations and recommendations. It will submit its annual report to the agency at a public meeting in November 2024. The IRS strives to appoint members to the IRSAC who represent the taxpaying public, the tax professional community, small and large businesses, tax exempt and government entities and information reporting interests.
This Queens teacher went from being an accountant to teaching entrepreneurship [Chalkbeat]
Lorena Izzo was working as an accountant about 20 years ago when she was assigned to oversee a college intern and realized her true calling: to become a teacher. She returned to her alma mater, Hofstra University, to get a master’s in math education (on top of her MBA). She landed a job at the Academy of Finance and Enterprise in Long Island City, Queens, and she has remained there for nearly 17 years, teaching entrepreneurship, financial services, and accounting.
JPMorgan Chase Elects Mark Weinberger to its Board of Directors [JPMorgan Chase]
JPMorgan Chase (NYSE: JPM) announced today that Mark Weinberger, 62, has been elected to its Board of Directors, effective immediately. He will also serve as a member of the Board’s Audit Committee. Mr. Weinberger was Global Chairman and Chief Executive Officer of Ernst & Young (EY) from 2013 to 2019. During his tenure, he led the global professional services organization through a purpose-driven transformation across more than 150 countries to deliver on EY’s mission of building a better working world. He currently sits on the boards of public companies Johnson & Johnson, MetLife and Saudi Aramco, as well as JUST Capital and the National Bureau of Economic Research. In addition, he serves on the Board of Trustees for Emory University and Case Western Reserve University.
Exclusive: S.F. tower known as the ‘KPMG building’ may lose a key tenant: KPMG [San Francisco Chronicle]
When KPMG first leased space inside a 25-story office tower in downtown San Francisco, a year after the building opened for business in 2002, the company obtained naming rights, leading to the tower becoming widely known as the “KPMG building.” One of the world’s four largest accounting firms, KPMG initially took 90,000 square feet at 55 Second St. in a 10-year contract, marking the second-largest office deal of 2003. It has since grown its footprint to span nearly one-third of the 380,000-square-foot building. But it now appears that the firm is considering ending its two-decade-long tenancy inside its namesake tower. The consideration comes amid continued turmoil in San Francisco’s office market, which is causing the city’s office rents — not long ago among the highest in the nation — to dip in the wake of the pandemic as more office space has become available than tenants currently need or desire.