Friday Footnotes: PwC’s Turn For a Probe; Accounting Professor Does a Naughty; The IRS is Hiring | 3.11.22

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‘Big Four’ Targeted Again in U.K.—PwC Becomes Latest Subject of Investigations [Bloomberg Tax] Paul Brehony of Signature Litigation LLP looks at the growing number of investigations by the U.K. tax authority into historic audit failures by the “Big Four” firms, and discusses the prospects for success of proposed major reforms to the audit regime.

The I.R.S. plans to hire 10,000 workers to clear a tax return backlog. [New York Times] The Internal Revenue Service said on Thursday that it planned a hiring spree this tax season as it tries to clear a backlog of more than 20 million unprocessed tax returns from previous years. The agency said it intended to hire 10,000 new employees in the next year and hoped to bring on about half of those workers in the next few months. The I.R.S. described the blueprint as an “all hands on deck” approach to emerge from longstanding staffing shortages that were compounded by the pandemic.

The Top 100 Firms and Regional Leaders [Accounting Today] AT’s annual dick measuring contest is here!

SEC’s Top Accountant Warns of Bias Against Big Restatements [Bloomberg Tax] The SEC’s top accountant Wednesday questioned arguments used to justify stealth revisions to fix accounting errors, warning that companies and their auditors may be biased in making assessments to determine how to correct the mistakes.

LaGuardia Community College Accounting Prof. Sentenced to 14 Months in Prison for Preparing Bogus Tax Returns [Sunnyside Post] An Astoria accounting professor who owns a local tax consultancy firm was sentenced to 14 months in prison Wednesday for preparing bogus tax returns — following a sting operation conducted by undercover investigators.

Clients do the darnedest things!

AICPA, CIMA and Largest Accounting Firms Cease Russian Operations [CPA Practice Advisor] “We wholeheartedly stand with the people of Ukraine and join many voices around the world in calling for peace,” the organizations said in a joint statement. “Our thoughts are with members, students and staff devastated by the Russian military invasion. We are suspending indefinitely the sale and delivery of services to Russia and Belarus, including the provision of in-market membership activities for AICPA and CIMA members and the following CIMA examinations: Professional Qualification; Certificate in Performance Management in Russian; Advanced Diploma in Performance Management in Russian; and Certificate in Business Accounting. We acknowledge this will affect many members and students who are caught up in the situation.”

KPMG ‘not able to refute’ allegations against Adler Group [Financial Times] Adler Group’s shares rose on Friday even after the scandal-plagued real estate company revealed that an investigation from its auditor had not refuted key allegations of financial impropriety made against it.

Grant Thornton CEO favours banning all non-audit services for listed audit clients [ETCFO] Meanwhile, in India… Vishesh Chandiok, Chief Executive Officer at Grant Thornton Bharat, is in complete favour of a regulation that bans all-out non-audit services for listed company auditors, saying such a move could improve audit quality as well as help help discover better pricing for the markets.

Oh good, firms are finally turning to Reddit to figure out how to retain talent and… oh. Wait. I get it.

China, U.S. expected to reach consensus soon in audit talks -sources [Reuters] Discussions between Chinese and U.S. regulators over cooperation on audit and regulation are proceeding smoothly, two sources with direct knowledge of the talks told Reuters on Friday, after a warning by the U.S. over some Chinese companies.

Deloitte Chair Sharon Thorne: “We Need More Female Role Models-You Can’t Be What You Can’t See” [Forbes] Thorne: “One of the most important things we can do is provide meaningful development opportunities for women throughout their careers. This means training women in key operations, finance or production roles – the roles that often lead to senior executive positions including CEO. In my experience, possibly due to unconscious or systemic bias, we tend to see more men being trained in these key roles. Women are more likely to develop deep expertise in areas such as marketing or talent, and move up the ranks boxed into these roles. We need more female role models – you can’t be what you can’t see.”

EY bites hand that feeds, lives to tell the tale [Australian Financial Review] It’s not every day paid consultants turn whistleblower. And even rarer to see said paid professionals keep their fees in the aftermath. Auditors really are a class of their own.

BDO’s Bristol office reopens after major refurbishment [BusinessLive] New digs in Bristol for BDO.

Photo by Chiper Catalin

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