September 25, 2022

Friday Footnotes: Firms Make Progress on Diversity; EY Growth Plan; PIZZA PARTY! | 3.8.22

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CPA firms show progress in diversity amid pipeline challenges [Journal of Accountancy] The AICPA finally got around to releasing their 2021 Trends report, which we’ll dissect shortly. In the meantime, here’s a tidbit: The profession’s efforts to encourage diversity, equity, and inclusion delivered progress with a rise of almost 5 percentage points (a change from 30.1% in 2018 to 34.7% in 2020) in the portion of new accounting graduate hires at CPA firms who are ethnically diverse. This occurred despite an ethnic diversity trend in bachelor’s degrees that has been almost completely flat dating back to 2013–2014. Meanwhile, the portion of ethnically diverse partners in accounting/finance functions at CPA firms doubled over a two-year period from 9% to 18%. These included gains with partners identifying as Asian/Pacific Islander (from 4% to 10%), Hispanic/Latino (from 2% to 5%), and Black/African American (from 1% to 2%).

Polymetal International’s Auditor Deloitte Resigns Citing Russian Operations [MarketWatch] Polymetal International PLC said Friday that its auditor Deloitte LLP has resigned with effect from April 7 as it won’t be able to carry out the audit process as most of the company’s assets and operations are in Russia. The precious-metals miner said the board has begun the search for a replacement auditor and will update shareholders in due course.

EY aims to double consulting business to 10,000 people by 2026 [Consultancy.uk] EY has launched ambitious growth plans within its consulting practice. Over the coming four years, a £75 million investment will see the practice expand its UK and Ireland team with more than 5,000 consultants.

I have a hunch someone might need to read this today:

Former member of CPA licensing board surrenders his own license [Iowa Capital Dispatch] Thomas Engelmann, who served at least six years on the Davenport City Council and was once the chairman and treasurer of Scott County Democrats, has surrendered his license as a certified public accountant to the Iowa Accountancy Examining Board. In 2002, Engelmann was appointed to the board by Gov. Tom Vilsack. He was reappointed in 2005 and 2008. According to recent filings by the board, Engelmann failed to comply with the terms of a 2017 agreement with the board. That agreement stemmed from a 2016 decision by the American Institute of CPAs involving concerns over Engelmann’s audit of financial statements tied to an unspecified “employee benefit plan.”

KPMG accepted work ‘rife with conflict’, parliamentary committee finds [Australian Financial Review] The $20 billion Transport Asset Holding Entity is a “financial and organisational mistake” that risks increasing the NSW budget deficit by up to $14 billion and should be disbanded, a NSW parliamentary accountability committee has found. In a report tabled on Friday, the committee criticised KPMG for accepting work relating to TAHE from both NSW Treasury and Transport for NSW, saying the decision was “rife with conflict both internally in KPMG and externally” with the two agencies.

Expanding Options for Providing Attestation Services [The CPA Journal] The assertion-based and direct examination engagements are two of the four types of attestation engagements CPAs can provide clients. This article focuses on the differences between assertion-based (section 205) and direct (section 206) examination engagements.

Sotheby’s Accountant’s Would-Be Class Wage Suit Tossed, for Now [Bloomberg Law] Sotheby’s convinced a federal judge in New Jersey to throw out a proposed class action brought by an accountant who claims he and others were misclassified as independent contractors, rather than employees.

A tale of two offices on Reddit this week:

Accounting professor to traverse Amazon for climate initiative [Accounting Today] No, not that Amazon: Kurt Sartorius, an accounting professor at the University of Witwatersrand in Johannesburg, South Africa, plans to paddle the Rio Madre, a tributary of the Amazon River, this July with his son Benn to record damage to the environment brought on by deforestation in an effort to bring climate change awareness to the accounting profession.

IRS answers only 20% of taxpayer phone calls during filing season logjam [New York Post] Internal Revenue Service agents are answering just a fraction of all incoming customer service calls as the embattled agency struggles with a record volume of inquiries and a massive backlog of tax returns, IRS Commissioner Chuck Rettig acknowledged during a Senate hearing this week.

China Weighs Giving U.S. Full Access to Audits of Most Firms [Bloomberg] Chinese authorities are preparing to give U.S. regulators full access to auditing reports of the majority of the 200-plus companies listed in New York as soon as mid-this year, making a rare concession to prevent a further decoupling between the world’s two largest economies.

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