Footnotes is a collection of stories from around the accounting profession curated by actual humans and published every Friday at 5pm Eastern. While you’re here, subscribe to our newsletter to get the week’s top stories in your inbox every Tuesday and Friday. See ya.
KPMG halves pay for US partners on gardening leave amid poaching war [Financial Times]
KPMG’s US partners have been told that they will be put on 50 per cent pay during six months of gardening leave if they quit to join a rival, marking an escalation in efforts by the Big Four accounting firms to stop staff poaching. The move sets KPMG apart from its rivals Deloitte, PwC and EY and complicates the decision by partners to leave, since they may have to find money to cover the bills until they join the next firm, even if their new place of work agrees to make them whole later.
PwC’s Indigenous arm receiving contracts in wake of scandal [Independent Australia]
Disgraced consultancy PricewaterhouseCoopers (PwC)’s “Indigenous Consulting” arm – which has been given more than $44 million in federal government contracts – is owned by just two people other than PwC itself. They include former Sydney financial adviser Gavin Brown, who owns 35% of PwC’s Indigenous Consulting through his private company, Validus Private Wealth. It can further be revealed that PwC’s Indigenous Consulting, which says it ‘works together with governments’ to ‘close the gap’ and has been given at least $44.67 million in federal contracts, has also been given millions of dollars of contracts from the Northern Territory Government.
AWS and PwC to deliver $800m to clients in three-year deal [ERP Today]
Amazon Web Services (AWS) has signed a three-year global strategic collaboration agreement with PwC to boost innovation and operational efficiency. The collaboration will build on a long-standing relationship, combining PwC’s consulting and software engineering capabilities with AWS’ infrastructure and services, and hopes to deliver approximately $800m in value to clients. In addition, it will play a part in building PwC’s global strategy, The New Equation, to deliver human-led and tech-powered solutions.
Postponement of Ernst & Young Tower foreclosure auction may signal negotiations [Crain’s Cleveland Business]
A foreclosure auction involving the Ernst & Young Tower at the Flats East Bank has been delayed, in a move that points to behind-the-scenes negotiations between the Wolstein family and a lender on the high-profile downtown property.
Little Rock housing authority will provide auditing firm with range of requested documents [Arkansas Advocate]
HUD assessed Little Rock’s federally-funded public housing authority’s physical condition, financial condition, management and use of its capital fund and gave it 40 points out of a possible 100. The agency scored zero for both management and financial condition due to its failure to submit required financial information to HUD in a timely manner.
EY dealmaker on TPG offer: ‘It’s not the moment to engage’ [Private Equity News]
One of EY’s most senior figures has said it is “not the moment” to engage with private equity over its future as the Big Four firm prepares to select a new leader. Andrea Guerzoni, EY’s global vice chair of strategy and transactions, told Private Equity News: “We’ll refresh our strategy following the appointment of the new CEO. It’s quite obvious that this is not the moment to engage with these kinds of situations.”
Taxing the Metaverse [SSRN]
The buzz surrounding the Metaverse has been growing steadily for the past couple of years, but the tax implications of this novel ecosystem remain fuzzy to most tax scholars. Such uncertainty is concerning, given the potential and momentum of this emerging technology. Although the Metaverse evolved from online video games focused only on user consumption, it now allows users to produce income and accumulate wealth entirely within the Metaverse. Current law seems to defer taxation of such until a realization or cash-out event. This paper challenges this approach.
University of Kansas School of Business receives anonymous $50 million donation [KSHB]
The University of Kansas School of Business received a $50 million commitment from an anonymous donor that will transform business education and research at the school. The gift, the largest in KU School of Business history, will also provide funds to advance key initiatives supporting undergraduate student success. The newly endowed fund will provide critical resources for several of the school’s priorities, including improving the quality and quantity of scholarly output by providing support for faculty professorships and fellowships. As the school experiences record growth in student enrollment, this gift also will bolster student success priorities including the school’s recently revamped entrepreneurship programs; career-focused opportunities within the school’s EY Professionalism Program; and scholarship, retention and programmatic efforts among diversity, equity, inclusion and belonging (DEIB), study abroad and academic enrichment programs.
The Great Return [The Memo from Quartz at Work]
Employers are ending the summer with an earnest push to bring teams back into the office. In the US, companies have coalesced around a particular holiday: Labor Day. Starting this month, one million American employees will be subject to a new return-to-office mandate, according to new research (pdf) from real estate firm Jones Lang LaSalle (JLL). “While it may seem arbitrary, choosing Labor Day as the moment to bring workers back to the office could be a calculated move by organizations,” Sue Cantrell, vice president of products and workforce strategies at Deloitte Consulting, tells Quartz. It comes as public schools are back in session, freeing up caregivers to get commuting again; it dovetails with the end of vacations and Summer Fridays.
The demand for hybrid work is only growing, according to a new Deloitte report [ZDNET]
The Deloitte 2023 Connected Consumer Survey asked 2,018 US consumers regarding their thoughts and attitudes towards “digital life.” The respondents’ answers demonstrate that workers reap more benefits from a remote or hybrid work model. According to the report, 56% of employed adults worked in a fully remote or hybrid way at their primary job over the past year. Of those remote and hybrid workers, a whopping 45% said working from home caused family relationships to improve, and 40% said it improved their emotional well-being, Deloitte shared.
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Meet the 2023 Best Midsized and Large Firms to Work For [Accounting Today]
Each year, Accounting Today and Best Companies Group select the Best Accounting Firms to Work For. This slideshow includes the best in the Midsized Category (firms with between 50-249 employees) and the Large Category (250 or more employees) with their rankings and select information on the firms, as well as photos the firms submitted themselves (or, occasionally, their website).
Lorena Engelman appointed as CJBS’s First Female Equity Partner [Daily Herald]
Get your boots on, it’s thick up in here.
In a significant stride towards fostering diversity and promoting gender equality within its leadership ranks, CJBS, a prominent accounting firm based in Illinois, is proud to announce the appointment of Lorena Engelman as its first female equity partner. This milestone appointment not only highlights Engelman’s impressive career but also underlines CJBS’s unwavering commitment to inclusivity.
LaPorte Acquires Houston Firm [INSIDE Public Accounting]
Metairie, La.-based IPA 200 firm LaPorte CPAs & Business Advisors (FY22 net revenue of $31.4 million) is merging in Gomez & Company of Houston. “Gomez & Company’s primary industry strengths dovetail well with our formalized industry groups and allows us to build on that client base,” says LaPorte president and CEO Eric Bosch.
Baker Tilly Names Deanna Merryfield Managing Partner of Global Workforce Strategy [Business Wire]
Baker Tilly US announces the appointment of Deanna Merryfield as managing partner – global workforce strategy. She is the first executive in this global role. “I am fueled by the pursuit of process enhancement, proactively identifying challenges, and offering a comprehensive toolkit for facilitating transformations,” Merryfield said. “It is a privilege to be guiding our exceptional teams to strategically deploy resources, enhance our people’s experiences and further align our business strategies to serve our clients.”