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.
News
The leak that puts a multibillion-dollar industry at risk [Sydney Morning Herald]
A foolish attempt to help multinational companies avoid paying tax in Australia has spectacularly backfired on the multibillion-dollar professional services industry, infuriating Canberra and potentially costing these high-profile firms billions in fees. A recent ban on PricewaterhouseCoopers’ former head of international tax, Peter Collins, acting as a tax practitioner – for attempting to profiteer from confidential information about government plans to combat tax avoidance – has achieved the rare feat of uniting Australia’s warring political parties. On Tuesday, public hearings will commence in the Senate inquiry into the billions the federal government spends with these financial services firms and how to ensure the integrity of the providers. Meanwhile, the government is mulling options that include banning tax advisory firms from tendering for contracts if they do not curb this kind of misconduct.
New Jersey Society of CPAs Awards $221,500 in Accounting Scholarships [NJCPA]
The New Jersey Society of CPAs (NJCPA) awarded $221,500 in scholarships to 53 New Jersey-based high school and college students on April 27 at the Pines Manor in Edison. Out of 146 applicants, the NJCPA Scholarship Fund distributed scholarships to 35 college students and 18 high school students. The college students each received between $2,000 and $6,500. The winners had to be accounting students at New Jersey colleges or universities who are currently in their junior year or in their senior year and entering an accounting-related graduate program.
EY announces the integration of the Latin America region and appoints Manuel Solano as Regional Managing Partner [BNamericas]
As of July 1, 2023, the professional services firm EY will integrate the operations of the 18 countries where it has a presence in Latin America into a single region. In this new model, EY integrates the talent and experience of more than 25,000 employees in Argentina, Bolivia, Brazil, Colombia, Costa Rica, Chile, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, the Dominican Republic, Peru, Uruguay and Venezuela.
Accountant petitions CRA to extend tax deadlines amid strike [CBC]
With the deadline for Canadians to file their taxes just days away, some accountants are worried that the public servants’ strike could cause low-income taxpayers to miss out on filing and securing access to the benefits they rely on. The strike of more than 35,000 Canada Revenue Agency employees has made it much more difficult to reach out to government experts, with some services suspended and others seeing prolonged delays. “People don’t have three or four hours in their day to sit there and wait on the CRA to answer their phone calls,” said Eric Saumure, a chartered accountant with Zenbooks.
Big 4
Goldman Sachs and PwC top M&A financial advisers by value and volume in power sector in Q1 2023 [GlobalData]
Goldman Sachs and PwC were the top mergers and acquisitions (M&A) financial advisers in the power sector in Q1 2023 by value and volume, respectively, according to the latest financial advisers league table by GlobalData, which ranks financial advisers by the value and volume of M&A deals on which they advised. Data reveals Goldman Sachs achieved its leading position in terms of value by advising on $10.7 billion worth of deals. Meanwhile, PwC led by volume having advised on a total of eight deals.
BPS brings back Ernst & Young for exam school admissions after GPA error [Boston Globe]
Boston Public Schools has rehired Ernst & Young to audit its exam school admissions decisions after the district wrongly told dozens of students that they were or were not eligible for the three prestigious high schools, Superintendent Mary Skipper said Wednesday night at a School Committee meeting. The district employed Ernst & Young last year for the first year of a complex new admission process for the schools, Boston Latin School, Boston Latin Academy, and the O’Bryant School of Math and Science. No known errors came to light under the global accounting firm’s watch. But the district moved on to local consultant firm Borderland Partners this year, and parents caught multiple errors, including the recent error in calculating GPAs that affected eligibility for dozens of students and would have affected the composite scores that determine admissions for many more.
New partner couldn’t pass up the ‘growth opportunity’ on offer at PwC [Australian Financial Review]
New PwC partner Chantal De Beer says she had to be convinced to take a first meeting with the recruiter aiming to entice her over from Deloitte. “A recruiter reached out to me on a number of occasions and I eventually met up with him,” the 43-year-old said. “[It was clear] there was this growth opportunity for me at PwC.”
Senior KPMG talent scatters to rival firms across Australia [Consultancy.au.com]
A number of consulting firms around Australia – including Ankura, Auxilium, Aurecon, Cor Cordis and Big Four rivals – have recently picked up senior talent from KPMG.
Technology
Deloitte looks to bring AI to the frontline with a little help from Nvidia [VentureBeat]
Deloitte is growing its set of artificial intelligence (AI) capabilities with the launch this week of a pair of new services for its quartz AI offering. The quartz AI services include compass AI for logistics and frontline AI for customer care deployments. The new quartz AI services are built with technologies from Nvidia, which Deloitte has partnered closely with in recent years to help advance its own AI initiatives. Deloitte is making use of Nvidia omniverse as well as technologies from the Nvidia enterprise AI stack as a foundation to help build out Quartz AI.
Georgia is paying hackers to break into its Medicaid portal [Axios]
Apsey said the state has shared any problems with the federal government and the vendor who built Gateway, Deloitte, to get things patched.
Deloitte handles benefits portals in other states too and where appropriate those repairs are translated. Karen Walsh, a spokesperson for Deloitte, said that she could not comment on particular systems, but said the company, “the nation’s leading provider of health and human service consulting,” is always working to improve its security measures. “We work collaboratively with the State of Georgia and other clients to constantly enhance the security of our systems, respond to ever-changing cyber threats, and fortify system protections as issues are identified,” she said.
Audit
Audit partners suffer after writing critical ICOs: study [CFO Dive]
Audit partners who write adverse internal control opinions are more likely than their less critical peers to be pulled from an engagement and shifted to less prestigious, lower-fee client assignments, according to a study. The setback for auditor partners is especially severe when their ICOs are somewhat subjective and when they focus on more important clients, according to the study published last month by academics at the University of Arkansas, Colorado State University and the University of Kansas. Audit partners suffer “negative consequences when they issue opinions that strain auditor-client relations, even though these opinions provide valuable information to capital market participants and are not likely to reflect lower audit quality,” the authors said.
Education
What can you do with a master’s degree in accounting? [Fortune]
To eventually land a role in senior management, you need to be well-versed in technology, and master’s degree programs in accounting are incorporating more analytical components to help prepare future business leaders, says Douglas M. Boyle, an accounting professor and the Ph.D. accounting program director at the University of Scranton. “That’s what a master’s of accountancy (MAcc) provides because accounting is really transitioning, and is one of the leading professions on implementing analytics,” he tells Fortune. This transition Boyle says is now taking place was predicated as “the next frontier” back in 2016 by the American Institute of Certified Public Accountants. That’s when the institute announced that CPAs needed to learn how to use advanced technology and deepen their knowledge of implementing data analytics, as the field of accounting was evolving.
Forget an MBA. This accountant has spent $250 to teach himself how to be a data analyst so he can get a $30,000 raise and buy a house. [Business Insider]
During the pandemic, Peer moved from his hometown of Detroit to Colorado Springs mainly to explore the outdoors. But he also moved to Colorado for its diverse mix of industries and job stability compared to Michigan. There’s one problem. “I cannot currently afford a house,” Peer said. The 34-year-old makes around $60,000 a year as a staff accountant for a non-profit in Colorado Springs, according to documents viewed by Insider. “I want a house to have a stable place to raise a family someday and a place to call my own to retire in,” he said. But moving up in the accounting world to afford a house would be costly. “That would be probably more college and more money and more time — a lot of time,” he said. “I didn’t want to do that.” Then one day in the fall of 2021 Peer saw a TikTok showing him it was possible to land a high-paying job without going back to school. Now he’s building up skills to work as a business intelligence or data analyst.
