October 24, 2021

Friday Footnotes: PwC Has an Evergrande Problem; Too Hard to Be a CPA; Big 4 Rot | 9.24.21

China Evergrande Auditor Gave Clean Bill of Health Despite Debt [Wall Street Journal] Last year as China Evergrande Group’s stock and bond prices seesawed, it offered deep discounts to keep sales growing during the pandemic and the government effectively said it had borrowed too much. Yet the property developer’s auditor [PwC] gave it a clean bill of health in an annual report issued this spring.

Deloitte Launches the Deloitte AI Academy to Advance Artificial Intelligence Proficiency for Business and Society [PR Newswire] Deloitte today announced the launch of the Deloitte AI Academy™ which is designed to help bridge the technology talent gap by developing and re-skilling today’s workforce with immersive training in the AI capabilities required for the digital economy. The Deloitte AI Academy will parallel Deloitte’s Cyber and Cloud Institute development strategies, and demonstrate Deloitte’s commitment to combine in-depth business knowledge with a mastery of technology to help its people and clients thrive in increasingly dynamic markets.

Is it too hard to become a CPA? Practitioners speak out [Accounting Today] It should probably come as no surprise that they were widely divided, with some contending that the monetary cost of extra schooling and the cost in time and effort of passing a very difficult exam are driving people away from the CPA profession, and others warning that any measures would dilute the value of the credential itself. Still others said that it wasn’t a question of the ease or difficulty of becoming a CPA, but rather a matter of communicating the true value of getting licensed and its career-boosting potential, while yet others suggested that it’s the brutal hours and low entry-level salaries that are turning young people away from joining the profession.

Places and job candidates don’t always match in government finance [Journal of Accountancy] In some parts of the country, there are more federal government finance jobs than candidates. That’s led to more openness to remote-work arrangements, especially after the COVID-19 pandemic showed it could be done.

PCAOB penalizes EY partners for Synchronoss audit deficiencies [Compliance Week] The Public Company Accounting Oversight Board (PCAOB) on Wednesday fined two EY partners for “failing to perform adequate procedures and obtain sufficient evidence concerning certain significant unusual transactions” in connection with the Big Four firm’s audit of a New Jersey software company.

Uppercut: KPMG cheating scandal mirrors Big Four rot, business leadership [Michael West] Only 1,100 KPMG Australia personnel out of a workforce of approximately 6,700 have been cheating, or 16.4%. That means that when the firm was providing services over 2016-2020 in respect of government awarded contracts, there is only a one in six chance that someone providing the services was a cheat on mandatory training courses.

IRS Program for Auditing Large Partnerships to Begin Next Month [Bloomberg Tax] The IRS plans to begin auditing large partnerships next month under a new program, an agency official said Friday. The Large Partnership Compliance Program is similar to an existing program at the IRS’s Large Business and International Division for large corporations. The new program relies on data analytics to select returns for audit, focusing on partnerships that are most at risk of running afoul of tax laws and regulations.

US takes new step on delisting Chinese companies from stock exchanges for audit violations [Yahoo] The US audit watchdog adopted a new rule on Wednesday that will help the board force companies flouting US audit regulations to delist from US exchanges, a move that threatens hundreds of Chinese businesses.

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