Friday Footnotes: Deloitte Adds Up All the Rocket Launchers; Wait, So ERC Is Done For Real? | 2.20.26

Posted on by Going Concern News Desk
orange cat on a yellow-orange chair
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Data

US munitions by the numbers: Tracking procurement and foreign military sales [Deloitte]
To help illuminate some of the activities shaping the defense industrial base, the Deloitte Center for Government Insights compiled this open-source data into charts tracking procurement and foreign sales across 21 types of munitions. The resulting charts organize and visualize this data to show trends in demand and production over time.

People

Seahawks head coach turned down a cushy career in finance at KPMG for a football internship—12 years later, he won the Super Bowl at 38 [Fortune]
“Cushy”
Mike Macdonald had graduated from the University of Georgia with a master’s degree in sports management, and he was at a crossroads. His four-year stint working for the college’s football team, the Bulldogs, was coming to a close. Despite loving football (and like many graduates before him), he chased a stable career and landed a job offer at Big Four global accounting firm KPMG at the end of 2013. “It felt like it was time, that there wasn’t anything that was going to come up,” Macdonald told The Athletic in 2022. “So I was kind of like, ‘OK, I guess I’ll go make some money.’ I signed a contract and everything.”

Investigation into High-Speed Rail CEO also includes conflict of interest concerns, Gov. Newsom confirms [KCRA Sacramento]
An investigation into California’s High-Speed Rail CEO following his arrest will also include concerns around his possible conflict of interest that has come to light, Gov. Gavin Newsom confirmed on Thursday. Ian Choudri has been on leave since Tuesday after KCRA 3 first reported police arrested him earlier this month on suspicion of misdemeanor domestic violence. Also arrested that night for a similar offense was Choudri’s fiancé, Lyudmyla Starostyuk. Starostyuk’s LinkedIn shows she was hired last month by accounting services firm KPMG, which state records show has a $24 million contract with the High-Speed Rail.

From analyst to vice president: A journey of growth, grit, and giving back at Deloitte [Deloitte]
This line is so funny:
A friend referred me to Deloitte, and when the offer came, I grabbed it—not because I knew what Deloitte stood for, but because I was in desperate need of a job.

KPMG asks Sydney writers’ festival to delete its name from website after Randa Abdel-Fattah confirmed as speaker [The Guardian]
The move follows the festival scheduling Palestinian Australian academic Randa Abdel-Fattah to speak at two sessions in this year’s event. A KPMG spokesperson confirmed the change on Thursday, telling the Guardian in a statement: “We are the auditor of the company, which we do not define as a ‘partner’. This is now reflected on their website.” They confirmed that in previous years, KPMG had been comfortable with being described as a partner on the festival’s website.

Tax

IRS looks to shrink office space after losing a quarter of its workforce last year [Federal News Network]
“We have a series of consolidation opportunities that are going on with respect to facilities. As everyone knows, a lot of work is done remotely these days. We have a number of facilities that have one, two people in them. And it begs the question of, why do we need those remote sites when we can have things done on a remote basis? And how can we get consolidation out of the facilities, both internally at the IRS, and also with agencies like the SSA or otherwise,” said IRS Chief Financial Officer Todd Newnam at an annual conference hosted by the Association of Government Accountants on Thursday.

IRS Leader Ousted Under GOP Pressure Reaches Agreement, Exits [Bloomberg Tax]
Holly Paz, a former top tax compliance leader at the IRS, reached an agreement with the agency this week after she sued over the leak of her employment data to media outlets. Paz is no longer employed by the IRS, according to a person familiar with the situation. She filed a voluntary dismissal of the case with prejudice in US District Court for the District of Columbia earlier this week.

An Analysis of the Special Depreciation Allowance Under the One Big Beautiful Bill Act [Current Federal Tax Developments]
Because the enactment of the One, Big, Beautiful Bill Act (OBBBA) significantly altered depreciation timelines for certain property, tax professionals require immediate operational rules. Notice 2026-16 bridges the gap between the statutory enactment and the eventual publication of final Treasury Regulations by offering interim guidance upon which taxpayers may rely.

Is The IRS Done Granting Employee Retention Credit (ERC) Refunds? [Forbes]
Many in the tax practitioner community were surprised that the IRS has “closed” all but 41,000 Employee Retention Credit (often called the ERC, or ERTC) refund claims, leaving only those that are either in Examination (i.e., under audit) or Appeal (i.e., where the IRS has already disallowed some or all of an ERC claim, and the taxpayer has protested the disallowance to the IRS Independent Office of Appeals “IRS Appeals”). I am personally aware of many ERC refund claims that the IRS has not taken any action on. The IRS has not audited these claims, disallowed them, issued refunds, or taken any other action at all.

Let’s See Those Receipts

State Republicans propose non-profit audits and expanded OIG [Inside Investigator (Connecticut)]
Stephen Harding Jr. said that Republican lawmakers would be drafting legislation which would require non-profit organizations to come before the legislature’s Appropriations Committee to make formal requests for state funds. Organizations would have to provide outlines for their proposed use of the funds, and disclose any personal connections or conflict of interests any sitting legislator may have.

Opinion: Transparency isn’t a political attack — it’s a public obligation [Crain’s Chicago Business]
Writes Sara Albrecht, chairman of the board at the Liberty Justice Center:
Chicago Teachers Union leaders would like the public to believe that recent federal scrutiny of their finances is part of a right-wing conspiracy — an attack on educators, students, and social justice itself. That framing may be effective rally rhetoric. It is also deeply misleading. This controversy isn’t about ideology or national culture wars. It’s about something far simpler and far more fundamental: money, accountability, and the public’s right to know how taxpayer dollars are spent.

Related Posts

Accounting News Roundup: KPMG’s Hiring Spree; PCAOB Issues Audit Practice Alert No. 7; Groupon Names Amazon Exec as CFO| 12.21.10

New York Leads in Pursuit of Lehman [WSJ]
In 2001, the regulator of the nation’s biggest banks told its examiners to be on the lookout for firms whose regulatory filings made them look healthier than they really were. That followed guidelines issued in 1990 that said banks could face disciplinary action if their filings “have significant inaccuracies or are ‘window dressed.’ “

But as early as this week, it is the New York attorney general—not the Office of the Comptroller of the Currency, the bank regulator—who is expected to file a lawsuit alleging accounting firm Ernst & Young LLP allowed Wall Street broker Lehman Brothers Holdings to fake itsppear financially healthier.

Staff Audit Practice Alert No. 7 [PCAOB]
Knowing the PCAOB like we do, we’re expecting a major dump of auditor inspections and disciplinary orders on Friday around 3 pm.

Globalization, Regulation and Offshoring Push KPMG to Hire 250,000 over Five Years [FINS]
Julie Steinberg at FINS gets the lowdown from KPMG’s Global Head of People, Rachel Campbell.

SEC Fines Audit Firm, Bars Partner Over China Energy Fraud [Bloomberg]
The U.S. Securities and Exchange Commission fined a California audit firm and one of its partners $129,500 for “improper professional conduct” in connection with a Chinese energy company accused of accounting fraud.

Moore Stephens Wurth Frazer & Torbet LLP of Orange County “did not exercise professional skepticism and due professional care” in audits of China Energy Savings Technology Inc., the agency said in a statement today. Kerry Dean Yamagata, 53, the partner at Moore Stephens responsible for the audits, was barred from practicing as an independent accountant for at least two years, the SEC said.

Accounting Majors Score Lowest in Verbal and Writing Among All Grad Students [TaxProf Blog]
Get better, people.

Details of secret bank talks revealed [FT]
It gets more awkward for auditors in the UK.

Deloitte CEO: Better Career Preparation Starts in High School [Hire Education/WSJ]
Barry Salzberg gets academic in a blog post for the Journal.


BAE to be handed Tanzania fine on Tuesday [Reuters]
BAE Systems will be fined by a London court on Tuesday after pleading guilty to making accounting errors in Tanzania, bringing a six-year investigation into the company’s activities to an end.

The fine is expected to sign off a settlement agreed between Britain’s Serious Fraud Office (SFO) and BAE in February when the British defence firm entered into a plea bargain deal with the UK fraud watchdog.

How to Make Auditors More Accountable [Room for Debate/NYT]
For those of you looking to get all pointy-headed about this E&Y/Lehman debacle.

Groupon Hires Amazon Finance Executive Child as CFO to Help Raise Funding [Bloomberg]
Groupon Inc., owner of a daily coupon website with 40 million subscribers, named Jason Child chief financial officer as it considers raising more money to fund growth.

Child, 42, previously served as Amazon.com Inc.’s vice president of finance, overseeing its $14 billion international business, Groupon said today in a statement. He will relocate to Chicago, where Groupon is based.

Accounting News Roundup: E&Y Has a Sour Outlook on Greece; Snoop Dogg Smokes Tax Lien; The iPad Debate | 09.29.11

The best way to tackle the Big Four [FT]
Michel Barnier has shocked the Big Four accounting firms. The European Union internal market commissioner wants to ban them from operating as consultants as well as auditors, force them to work jointly with others, and set time limits on how long they can audit each company. It could be the biggest shake-up of accounting since the collapse of Enron laid low Arthur Andersen and led to the 2002 Sarbanes-Oxley Act. Yet it will not amount to much unless the industry’s looming disaster – the failure of another audit firm and contraction to a Big Three – can be avoided.

E&Y Says Greek Defau [Bloomberg]
“The euro zone sovereign-debt crisis shows no sign of abating,” E&Y said in an e-mailed report in London [Wednesday]. “A default on Greek government debt now seems unavoidable. The key question is when this default will occur and how it will be managed.”

To Ease the Crisis, Tax Financial Transactions [NYT]
Governments, both rich and poor, urgently need a way to calm speculation in the financial markets and to raise revenue. On Wednesday, the European Commission president, José Manuel Barroso, proposed a tax on financial transactions. Such a measure, already supported by the German chancellor, Angela Merkel, and the French president, Nicolas Sarkozy, is long overdue. Indeed, a tax of just 0.05 percent levied on each stock, bond, derivative or currency transaction would be aimed at financial institutions’ casino-style trading, which helped precipitate the economic crisis. Because these markets are so vast, the tax could raise hundreds of billions of dollars a year globally for cash-strapped governments and could increase development aid.

D.C. tax employee’s arrest followed years of warnings [WaPo]
[F]ederal prosecutors charged a D.C. tax office employee with stealing about $414,000 from the city coffers. Mary Ayers-Zander did it, charging papers state, by making fraudulent manual adjustments to legitimate taxpayers’ income tax withholding, resulting in payments to personal accounts she had set up. In other words, Ayers-Zander found a weakness in the system and exploited it, finding a way to enrich herself because the internal controls within the Office of Tax and Revenue were not up to par, according to court records.

Snoop Dogg tax debt goes up in smoke [TW]
Robert Snell’s celeb tax scoop du jour.

Mr. Buffett’s Tax Secrets [WSJ]
[T]he opportunity to educate the public would be even greater if Mr. Buffett would let everyone else in on his secrets of tax avoidance by releasing his tax returns. Going only by Mr. Buffett’s unverified claims, his federal taxes in 2010 amounted to 17.4% of his taxable income, probably because much of his income was from capital gains and dividends. It’s also likely that he took significant deductions for charitable donations. No doubt the millions of Americans who could end up paying more because of this claim would love to see the details.


Medicis, its auditor will pay $18 mil to settle suit [Arizona Republic]
Medicis Pharmaceutical Corp. and its auditing firm, Ernst & Young, have agreed to pay $18 million to settle a shareholder class-action lawsuit stemming from the pharmaceutical company’s financial statements. Scottsdale-based Medicis would pay $11 million and Ernst & Young would pay $7 million under terms of a settlement agreement filed last week in U.S. District Court in Phoenix.

The iPad Decision [JofA]
Ask one CPA, the managing partner of a 160-employee firm, what he thinks of using the iPad in his work, and he tells you “there’s no other way to practice right now.” Ask another, the IT head of a 400-employee firm, and he tells you that his iPad is no more useful than a paperweight.