Hey, welcome to October. You have my permission to start putting up those Halloween decorations now. Let’s get right to it! The news, I mean.
Here’s something for anyone who needs it (you know who you are): Back in the office? Here’s how to be professional in the workplace
Bloomberg explains the PwC Australia tax scandal’s impact on firm governance in many words, a good read for anyone who still doesn’t understand what’s going on over there and what happened last week with the release of the Ziggy Switkowski report (or as Australian Financial Review called it, Ziggy Switkowski’s guide to making it at PwC).
Switkowski’s report found a number of PwC Australia governance, culture, and accountability failures, including:
– a lack of independence and external ‘voices’ on the firm’s governance board
– excessive power conferred on the CEO
– a disproportionate focus on revenue growth
– unclear responsibilities and accountability
– overly collegial culture that may have contributed to tolerating poor behavior by partners that brought in high revenues
Leaders of the embattled consulting giant PwC are expected to be called before a Senate inquiry later this month as fresh allegations emerge of more confidentiality breaches.
Meanwhile the firm’s global CEO, Bob Moritz, will visit Australia this week to meet clients and partners, but Labor senator Deborah O’Neill believes the visit should be seen as no more than “another PR exercise”.
“There’s nothing wrong with doing that but let’s not pretend it’s anything more than that,” O’Neill said.
O’Neill also said the “full shape” of PwC’s alleged wrongdoings would not be known until separate investigations by the Australian federal police and the Tax Practitioner’s Board are finalised and two Senate inquiries finish their reports.
We’ll be doing a deep dive on the Switkowski PwC report shortly.
Consultancy.org did a piece on Deloitte revenue over the last ten years.
Global accounting and advisory firm Deloitte is well and truly pulling away from its Big Four rivals. Despite the slight, general slowdown, the firm posted a whopping $65 billion in global revenues for its 2023 financial year to June, an increase of almost 15 percent on the year prior.
Denying talks of a sluggish market, the firm’s consulting division – Deloitte Consulting, Monitor Deloitte and Deloitte Digital – grew by 19%.
The AICPA has released a quality management practice aid, Establishing and Maintaining a System of Quality Management for a CPA Firm’s Accounting and Auditing Practice, and it is available in versions for sole practitioners and for small- and medium-sized firms.
The AICPA created the practice aid to help accounting professionals establish a QM system for their firm’s accounting and auditing practice in line with the Statement on Quality Management Standards (SQMS) No. 1, A Firm’s System of Quality Management. Firms must have a risk-based QM system in place by Dec. 15, 2025.
The interactive practice aid is intended to work in tandem with the Example Risk Assessment template (also available on the download page), which provides a starting point for each component and a library of quality risks and responses. The AICPA’s quality management resource page features more tools, such as a crosswalk document that summarizes the changes in SQMS No. 1 when compared to the previous quality control standard.
AICPA members can download the free practice aid here.
The University of North Dakota gets the only named school of accountancy in all of the Upper Midwest:
The North Dakota State Board of Higher Education has voted to rename the UND Department of Accounting and Information Systems to the Herr School of Accountancy, making it the first named school of accountancy in the Upper Midwest.
The school is named for alumnus Henry Herr, an accountant and businessman who earned undergraduate and graduate degrees in accounting from UND in 1968 and 1971. Herr helped found Healthways in 1981 and AmSurg in 1992, and as a CFO and board member, he helped create thousands of jobs and serve millions of patients, according to a release from UND.
He was named to UND’s Accounting Hall of Fame in 2011, received the Sioux Award for Distinguished Achievement and Leadership in 2015, and received an honorary doctorate from UND in 2022.
Like anyone else with an accounting school named after them, Herr is truly an OG. Here’s a 2020 UND article about him that explains how he ended up in healthcare:
Herr was born and raised in Bismarck, N.D. After earning his bachelor’s degree from what is now UND’s Nistler College of Business & Public Administration, he served in the U.S. Army’s 4th Infantry Division in Vietnam, earning the Bronze Star. He returned to UND for his graduate degree, and served as a graduate teaching assistant in Accountancy.
Following grad school, Herr took a job in the Oregon offices of Arthur Young. At that time, in the early 1970s, Medicare was reimbursing hospitals based on the complicated “step-down cost allocation” method. During a meeting, management asked if anyone had experience in that method. Of all his colleagues who came into the company at the same time as him, Herr was the only one whose school had a class in step-down cost allocation, Herr told the UND Alumni Review in 2015.
When he was the only one to raise his hand, he was told, “You’re in healthcare.”
Takeaway: don’t ever raise your hand unless you want to get stuck with something.
On Wednesday, the Anti-Corruption Bureau (ACB), Pune division arrested an accountant identified as Narendra Kanse working with the Talegaon Municipal Council for allegedly demanding a bribe to settle pending dues.
Speaking to Pune Pulse, Satyavan Mane, Police Inspector, Talegaon Dabhade Police Station said, “The contractor, who is the complainant in the case, was awarded a contract to perform work at a gas crematorium in Talegaon. The contractor was also awarded a contract to spray sanitiser during the COVID-19 pandemic. The bill amount for these works was pending. The contractor approached the accountant to clear the bills. The accountant allegedly asked the contractor to pay him 1% i.e. Rs 5,000 of the total bill to settle the pending dues. The contractor then approached the Anti-Corruption Bureau and filed a complaint.”
In government shutdown news, IRS employees are sleeping easier (for a few weeks anyway):
The leader of the National Treasury Employees Union spoke on behalf of IRS employees who won’t have to face the predicted furloughs.
“Frontline federal employees can rest easier tonight knowing that their service and their paychecks will not be interrupted by a senseless government shutdown,” said NTEU national president Doreen Greenwald in a statement Saturday night. “I strongly believe that the pressure federal employees and the American public brought to bear these last few days was an important factor in the last-minute decision to approve a continuing resolution that maintains agency funding levels through Nov. 17. When voters across the country fully understand the catastrophic impacts of a government shutdown, they then press their elected leaders to do their jobs and avoid a lapse in appropriations. That said, NTEU will continue to fight for appropriate and full-year agency funding for the remainder of the fiscal year to be approved before the next funding deadline in mid-November. The anxiety felt by federal employees in the chaos of the countdown to a government shutdown is not worthy of our democracy and must not become a normal part of doing business in Congress.”
WTF is this story out of South Africa? They teach accounting in 9th grade?
Accounting teacher fired for ‘forcefully grabbing’ grade 9 pupil and kissing her
A Gauteng accounting teacher has been fired for ‘forcefully grabbing’ and kissing a grade 9 pupil.
The disgraced teacher forced the pupil to give him her phone number as “punishment”. He then inundated her with calls and offers to take her out to a “concert”. And he “grabbed her into the computer room and he kissed her”.
The teacher called the victim afterwards and complimented her for being a “great kisser”.
Apparently Stephen King’s accountant hates him because like most clients he just doesn’t listen:
Film students can take advantage of what King calls his “Dollar Baby” deal to make an adaptation of his work for only $1.
But why sell the rights for a dollar at all? King is so famous that even his short stories could be sold for much more—a fact his accountant knows all too well. In his introduction to the 1996 publication The Shawshank Redemption: The Shooting Script, King described his desire to make adapting his stories accessible to creatives despite the lack of profit he would see from it:
“Around 1977 or so, when I started having some popular success, I saw a way to give back a little of the joy the movies had given me. Over the objections of my accountant, who saw all sorts of possible legal problems, I established a policy which still holds today. I will grant any student filmmaker the right to make a movie out of any short story I have written (not the novels, that would be ridiculous), so long as the film rights are still mine to assign … I have made the dollar deal, as I call it, over my accountant’s moans and head-clutching protests.”
Here’s something fun for the podcast people (INTHEBLACK is CPA Australia’s monthly business magazine):
Introducing Crime By Numbers, a new INTHEBLACK podcast
Go behind the scenes of Germany’s Wirecard scandal to hear from Dan McCrum, the Financial Times investigative reporter at the heart of the story. Experienced forensic accountants Glen UniComb CPA and Jeffrey Luckins FCPA also offer their insights.
Last thing, readers are encouraged to read “Disruption or Distortion? The Impact of AI on Future Operating Models” from Knowledge at Wharton, spotted in this Fortune article.
The authors make some interesting points. For starters, organizations will need to chart their own AI-transformation journey by prioritizing a “fluid” or “adaptive blueprint” over “brittle hierarchical” company structures. “Fluid organizations follow the 80/20 rule, able to respond to 80% of predictable events while remaining flexible enough to navigate the 20% of unforeseen challenges,” according to the article.
Alright that’s enough news for now. Go forth and be spooky! If you see anything interesting while staring hopelessly at your monitor this week please do let me know.