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February 2, 2023

Monday Morning Accounting News Brief: KPMG Vet Quits on Christmas; PwC Resigns; ‘A Veil of Legitimacy’ | 1.16.23

tired dog under blankets

An accountant used his position in the accounting department of the Volunteer Energy Cooperative (VEC) in Tennessee to steal nearly a million dollars, he used a refund scheme to transfer money into his personal checking account and make payments to his credit cards and his wife’s credit cards. A discussion about money laundering in Australia: “Accountants are at the frontline of this as the industry remains a popular avenue for financial criminals, who seek to leverage the industry’s prestige and firm/client relationships to launder money and give their illicit funds a veil of legitimacy.” EY launches its legal practice (EY Law) in Saudi Arabia. A guy who’s worked at KPMG since 1988 talks about writing his resignation letter at 6 in the morning on Christmas, it’s not at all salacious: “At 6am on Christmas Day, 2022, I sat down at my laptop and drafted my resignation letter from KPMG. After 34 years with the same firm I had decided that it was time to start a new challenge. I eventually resigned last week.” Embattled property developer China Evergrande on Monday said that its current auditor PwC has resigned as the parties disagreed over the timeline and scope of work surrounding the firm’s status as a going concern and other audit-related matters for fiscal 2021; In its resignation letter, PwC noted that it had not received information on certain material matters surrounding the group’s consolidated financial statements for the year 2021. FASB issued a series of tentative board decisions related to its project on the disaggregation of income statement expenses. Not that anyone cares but new Deloitte research reveals a majority of organizations increased sustainability investments over past year amid global uncertainty, 75% of CxOs said their organizations have increased their sustainability investments over the past year, nearly 20% of whom said they have increased investments “significantly.” And up North, Deloitte Canada research has found that Canada is falling behind on digital equity with growing gaps in access to digital technology and skills development, as well as an increased threat to online privacy and well-being, impacting Canada’s ability to compete globally.

Big 4 clients in Spain won’t be getting emails on the weekend, per reporting from Financial Times:

Spain’s labour ministry said on Monday that the Madrid offices of PwC, KPMG, EY and Deloitte had received visits from government inspectors in November as part of an investigation into potentially abusive practices.

“The main objective is to check whether there are any overtime hours for which employees have not been paid or received subsequent time off,” the ministry said, noting it was concerned about compliance with both labour and social security law.

Reddit is out here doing their part to promote the accounting career track to prospective students:

I lament my career path. I had planned to go to law school after undergrad, but I got a good job offer at the denouement of the recession. Worked for a small regional firm right out of college, moved to industry after 4 years, then moved to government after 4 years of industry. Works 4 days a week now, but has put in his time as a sleepless auditor during busy season. Hit the six figure mark at 29, but realized money and career isn’t everything. Now I just focus on doing my job while at work, and living my life when I’m at home. I don’t make my job my life, but I don’t half ass it either. I just see it as a job at this point. If I move up, I move up. If I don’t, I don’t. My life happens when I’m not at work, and that’s what I’m most focused on. Work is just a means to finance that life. I make enough for all of my needs, and most of my wants. I might have a different outlook on life if I had kids and a family, but as a single guy in my 30s, I’m doing alright. I’d recommend this career path to others if they did well in school bit [sic] have nothing else that they’re super passionate about.

It’s been 15 years since then-chairman Dennis Nally told everyone at PwC they would not have off for MLK Day. Since that went down a year before Going Concern was created, we’ll revisit it later.

Speaking of Dr. King, you probably haven’t heard Martin Luther King Jr’s August 28, 1963 “I Have a Dream” speech since elementary school, refresh yourself:

Have a great week, everyone! As always, my virtual door is open if you spot anything worth talking about.

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