Lots of Deloitte news this week, such is the way of the news cycle.
Deloitte and KPMG ask staff to use burner phones for Hong Kong trips [Financial Times]
Deloitte and KPMG have advised some US-based executives not to use their usual work phones in the territory, according to multiple people with knowledge of the policies. Several McKinsey consultants have also taken separate phones when travelling to the territory, the people said. Some senior staff are reluctant to visit Hong Kong as a result of the inconvenience of leaving devices behind, according to an executive at one global consultancy. The policy applies even to people not involved with sensitive projects, the person said, adding: “People are not prepared to come here.”
PwC’s vulnerability exposed as head of its risk and ethics duped by a fake email account [The Australian] Meanwhile, in Australia, PwC’s head of risk fell for a fake email.
Emails shown to The Australian show PwC chief risk and ethics leader Jan McCahey supplied information concerning the appointment of new general counsel Kylie Gray after she was contacted from a Proton mail account under Ms Gray’s name. Ms McCahey’s failure to identify the emails from the Protonmail account, a secure encrypted email platform, have been seen by some as a significant oversight by the firm’s new head of risk and ethics. This email to Ms McCahey, sent on Wednesday last week, questioned the chief risk officer over “my remuneration and bonus arrangements”, asking whether information could be kept secret from partners “in the current circumstances”. Ms McCahey told the sender, whom she believed to be Ms Gray, that her “rem and bonus arrangements will not be disclosed to partners”. The Australian understands this would be an unusual arrangement for PwC, with current and former partners saying partnership pay is usually disclosed within the firm.
Deloitte Asks Some China Staff to Take Unpaid Leave [Bloomberg Tax]
Deloitte has asked some China staff to take unpaid leave between December and February, Hong Kong media HK01 reports, citing unidentified people. Staff are asked to take leave for at least five days each month, which means they have to take a minimum of 15 days within three months. Employees who do not follow will be counseled out. The measure targets the non-audit departments of each city branch in China, including consulting, financial advisory, risk advisory and assurance.
How Is Deloitte Making Accounting Accessible To Diverse Young Talent? [Forbes] This is an ad, right? And where was the fact-checker? *Chartered* accountancy? MOST COVETED jobs for young people? Big X
Thalia Smith, Partner at Deloitte & Touche LLP has championed a pathway for diverse talent to enter an ever-important part of Corporate America. Smith’s choice of career? Chartered Accountancy. It is one of the most coveted jobs for young professionals in the United States. But the doors of entry are selective. And the barriers even higher for people of color. As of 2023, 64% of certified accountants are White. Only 10.8% are Hispanic or Latino. And at 8.5%, even fewer are Black. The glaring disparity is industry knowledge.
How Deloitte gave AR postcards the personal touch [The Drum]
Deloitte has won the Print category at The Drum Awards for B2B. Here is the award-winning case study.
Accounting firm staff to sleep outside in support of homeless [Winnipeg Sun]
Staff and partners of a Winnipeg accounting firm will sleep overnight to help raise donations and awareness for the Pan Am Place transitional housing facility in the Exchange District starting Wednesday evening. Staff at F.H. Black & Company Chartered Professional Accountants Inc. will sleep overnight on the street as part of the 12-hour “Cold Nights, Warm Hearts” Sleep Out fundraiser in the back alley beside Pan Am Place, 88 Arthur Street. The Sleep Out runs from Wednesday at 8 p.m. to Thursday at 8 a.m.
Six Months Later, Alumni Experience Tim Ryan’s Ethos Firsthand at PwC [Babson College] PwC newbies reflect on Tim Ryan’s commencement speech now that they’ve spent a few months working at his firm.
Tim Ryan ’88, H’23, U.S. chair and senior partner at PwC and the 2023 undergraduate Commencement speaker, addressed the students and their loved ones about the importance of “leading with love” and fostering trust in the workplace. The speech left a mark on the entire Babson community, though the students going on to PwC got a little extra; they got a sneak peak of the professional environment they worked so hard to join.
“As I sat under the Commencement tent, I expected to hear messages about working hard to build a company and achieve revenue growth,” Christopher Hill ’23, an audit associate at PwC, says. “I found this Commencement speech even more impactful that Tim advocated for the importance of making everyone feel valued. This speech is significant as we embark on our career journey and hope to lead with the principles highlighted by Tim.”
Six months after graduation, those Babson students are now full-time PwC employees. As they study for the CPA exam, move to their first apartments, and navigate their early careers, they get to witness how “leading with love” and compassion can bolster their professional journeys.
Mergers and Acquisitions
VonLehman CPA & Advisory Firm merges with top 100 company Dean Dorton [Cincinnati Business Courier]
One of Greater Cincinnati’s largest accounting firms has paired up with another regional firm that’s even bigger. Fort Wright-based VonLehman CPA & Advisory Firm has agreed to a merger with accounting firm Dean Dorton in a deal to be completed Jan. 1. VonLehman has offices in Fort Wright, Blue Ash and Indianapolis. Dean Dorton’s offices are in Lexington, Ky., where it started; Louisville, Ky.; and Raleigh, N.C. The combined firm will operate under the Dean Dorton name. That change will officially take effect in the new year.
Local accounting firm acquires longtime Orlando CPA company [South Florida Business Journal]
One of the largest accounting firms in South Florida acquired a longtime Central Florida CPA company. Coral Gables-based H&CO announced on Nov. 22 that it bought Orlando-based Grennan Fender for an undisclosed price. Grennan Fender was founded more than 40 years ago with offices in Orlando, Melbourne and Tampa.
Rise of the cyber CPA: What it means for CISOs [CSO] Interesting read on one of the new CPA exam disciplines with a variety of perspectives from the CISO side. Some folks aren’t fans of CPAs edging in on their territory it seems.
Not everyone agrees that cyber accountants will have a positive impact on the cybersecurity function. Douglas Brush, a special master with the US federal courts and the chief visionary officer for Accel Consulting, has dealt with accounting groups for many years, and he is suspicious about whether they will help security executives or if they are trying to undermine them. “Yeah, CPAs and the AICPA. Boy, do I have opinions on that. I knew they were going to pull some stuff between the CMMC, SEC, and CISA. They see blood in the water and want to edge out cyber pros to be the only ones who can certify,” Brush said. “For example, I am starting to do a SOC 2 Type 2 prep for a customer, which is easily a year-long engagement, and we are going to do a lot of heavy lifting to get them there. Then an auditor will come in and charge as much as we do and only do one-tenth of the work. I am not a fan of governing bodies like AICPA that up-charge services that are subjective, but they push as binary, black and white. They see a land grab.”
Workers say they want a skills-first approach, but employers struggle to make the shift [HR Dive]
A vast majority of workers surveyed — 83% — say they would stay longer at a firm with a skills-first approach, according to a Nov. 22 report from EY and iMocha. Notably, 48% of employees surveyed said they are “inadequately rewarded” for their skills. Skills-first companies reported 2-times higher revenue growth rates compared to others over the past three years, according to the report, as well as positive impacts in talent retention and performance.
Attention employers! Here are this week’s top remote accounting candidates of the week from Accountingfly. With tax season just around the corner, we’re including a batch of freelancers to check out as well. There’s no accountant shortage here.
Audit Quality Questioned at Baruch Conference [CFO Magazine]
Representatives from the Public Company Accounting Oversight Board (PCAOB) had one overarching message at the Baruch College auditing conference on Tuesday: the overseer is “laser-focused” on investor protection and is gunning for auditing firms that are reckless or negligent. PCAOB Chair Erica Williams, appearing in a pre-recorded video shown to the 75 or so auditors, policymakers, and academics in attendance, emphasized the record $11.9 million in fines the PCAOB has hit auditors with in calendar year 2023. Williams promised more enforcement actions penalizing firms for audit deficiencies before the year was out.
Accountable Independence: SEC Sues Indemnified Audit Firm [National Law Review] The “indemnified audit firm” is Prager Metis and this is a brutal takedown.
One of the critical attributes required of an accounting firm that desires to perform audits of a business’s financial statements is INDEPENDENCE. This is not just a descriptive term referring to the separation of the accounting firm from the business being audited; it is in fact a very technical regulatory requirement enshrined in regulations of the U.S. Securities and Exchange Commission (“SEC”) since the earliest days of the Commission.
Bridging the risk exposure gap with strategies for internal auditors [Help Net Security]
In this Help Net Security interview, Richard Chambers, Senior Internal Audit Advisor at AuditBoard, discusses the transformational role of the internal audit function and risk management in helping organizations bridge the gap in risk exposure.
ABA urges caution on proposed sustainability auditing standards [ABA Banking Journal]
Citing the nascent state of climate reporting and the resulting confusion by stakeholders of internal control requirements, the American Bankers Association today urged the International Auditing and Assurance Standards Board “to take a leading role in educating stakeholders as to the many demands of the assurance process, including the related costs and internal controls that will likely be needed” by companies reporting sustainability-related information. ABA’s comments came in response to the IAASB’s recent proposal on sustainability auditing standards that will likely influence auditing standard-setters worldwide, including the Auditing Standards Board and the Public Company Accounting Oversight Board in the U.S. “Requirements similar to the Sarbanes-Oxley Act in the U.S. for robust systems of internal controls and correspondingly stringent auditing could prove onerous to implement…without a significant transition period and expected users of such information may want to reconsider specific assurance requirements in light of updated estimates of costs and length of needed transition,” the association said.