October 30, 2020

Friday Footnotes: EY CEO Has Ragerts; PwC Saves the Planet; KPMG Gives Up | 9.18.20

Ed. note: we are continuing to experience some intermittent website issues, so please be patient while these are addressed on our end. Even the server has a touch of the ‘rona mental breakdown going around, it happens. 

EY chairman admits ‘regret’ over Wirecard failures in letter to clients [Financial Times] The global chairman of EY has expressed “regret” that a fraud at collapsed German fintech Wirecard was “not uncovered sooner” by his firm’s auditors and said the Big Four accounting group would “raise the bar significantly” on its vetting work. Carmine Di Sibio, who has run EY since January 2019, wrote to clients amid a backlash against the group after it failed to identify a €1.9bn fraud at the once high-flying payments processor it audited for a decade.

Luckin Coffee Announces Appointment of Marcum Bernstein & Pinchuk as New Independent Auditor [Global Newswire] EY got dumped.

PwC pledges to reach net zero emissions by 2030 [Accountancy Daily] PwC has committed to achieving net zero greenhouse gas (GHG) emissions across its global network within the next ten years, and will be taking action to support its suppliers and clients in tackling their impact on the climate. The plan is for PwC to cut its total greenhouse gas emissions by 50% in absolute terms by 2030.

KPMG abandons pension cuts after employees threaten legal action [Sky News] KPMG notified its 17,000 UK staff this week that it was “pausing” plans to temporarily reduce pension contributions for about 3,000 people. Insiders said that roughly 500 of the affected employees had formed a collective action group to fund a legal claim against the firm.

AICPA urges passage of ‘PPP 2’ legislation [Journal of Accountancy] “Money still remains unspent from the last PPP authorization, but businesses can’t currently tap those funds,” said Erik Asgeirsson, president and CEO of CPA.com, the AICPA’s business and technology arm. “We need to allow new loan applications and add additional resources to help small businesses during this critical time. We support efforts to enact PPP 2.”

Final Rules For Endowment Tax Exclude Some College Revenue [Bloomberg Tax] The IRS is excluding some income streams from final rules aimed at endowment income of wealthy universities. The 1.4% tax on net investment income—which applies to schools like Yale and Harvard—was part of the 2017 tax law, and falls under tax code Section 4968. The final rules, released Friday, could hit about 40 colleges, the agency has previously said.

Man charged with pandemic relief loan fraud pleads guilty [AP] A Rhode Island man charged with fraudulently seeking hundreds of thousands of dollars in forgivable federal loans designed for businesses struggling because of the coronavirus pandemic has pleaded guilty, federal authorities said Friday.

Public-private sector experience benefits quality across accounting [Accounting Today] Employing professionals with substantial public accounting experience has been and will continue to be critical to the success of regulators and standard-setters. These individuals help strengthen the quality of auditing standards and oversight; enhance the development and implementation of accounting standards; assist in compliance with pertinent and complex regulations; and contribute to building trust in the capital markets. These highly experienced, knowledgeable and hard-working personnel from the firms complement the activities of regulators and standard-setters alike and help enhance their overall effectiveness.

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