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January 27, 2023

Monday Morning Accounting News Brief: Social Class and Career Progression; New GAAP Taxonomy Dropped | 12.19.22

Small yellow dog laying on a blue sofa in front of christmas tree

Quick note: there will be no news brief next Monday, we are out for the week and will be running nothing but shitposts, repeats, and tedious top ten lists. Monday Morning Accounting News Brief will resume on January 2, 2023. Please try not to do anything newsworthy between now and then, I have the utmost faith in all of you. I will still be checking emails and the tipline, reach out if something exciting goes down. Now, the news!

A Deloitte study on trust and ethics in technology reveals that while business leaders are aggressively moving forward on implementing and using emerging technologies, with the exception of AI/cognitive technologies, nearly 90% of those surveyed lack a framework to support the implementation of ethical principles to guide its development and use. EY conducted 7,595 interviews with employees of large organizations across Asia-Pacific markets resulting in the “Asia-Pacific Belonging Barometer” which reveals only 43% of employees in Asia-Pacific feel like they belong in their workplace. PwC has recently developed an assessment framework to help clients evaluate the environmental footprint of their blockchain initiatives (insert *whoop-de-doo* sound here). “In common with several other professional service firms, we are currently evaluating our approach to this sector and the work we undertake for our clients,” a spokesman for the BDO international network said in regards to crypto work. Speaking of crypto, MarketWatch wrote up a profile on Mazars: While it falls some way behind the “Big Four” accounting firms — as Ernst & Young, PricewaterhouseCoopers, KPMG and Deloitte are known — it counts some major companies as clients; Axa, BNP Paribas, Goldman Sachs, Peugeot, and advertising firm Publicis. There was a weird article on Yahoo Finance! in which ChatGPT talks about accounting firms. For the first time in history, the PCAOB has secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong, on Thursday the Board voted to vacate the previous determinations to the contrary. A study recently published in the Review of Accounting Studies demonstrates that the use of artificial intelligence is significantly improving the quality and efficiency of financial statement audits, as well as displacing audit professionals. GET EXCITED! On Friday, FASB released its annual GAAP Taxonomy, which includes the 2023 GAAP Financial Reporting Taxonomy (GRT) and the 2023 SEC Reporting Taxonomy (SRT).

It is often said that accounting opens doors however new KPMG research has found that social class is the biggest barrier to career progression:

Socio-economic background has the strongest effect on an individual’s career progression, compared to any other diversity characteristic, according to ground-breaking research published by KPMG UK.

In the biggest ‘progression gap’ analysis ever published by a business, experts from the Bridge Group analysed the career paths of over 16,500 partners and employees at KPMG over a five-year period. The team examined the average time it took individuals to be promoted, looking at their gender, ethnicity, disability, sexual orientation as well as socio-economic background.

The data showed that socio-economic background, measured by parental occupation, had the strongest effect on how quickly an individual progressed through the firm. Individuals from lower socio-economic backgrounds took on average 19% longer to progress to the next grade, when compared to those from higher socio-economic backgrounds.

On FTX:

Something interesting went down in Maine:

An independent auditor called out elected officials of a tiny Maine municipality for violating the public trust by not following proper procedures for handling taxpayer money.

An accountant who performed The Forks Plantation’s annual audit for 2021 stopped short of saying its leadership was committing fraud, but described several unusual practices in a letter filed with a report to the state.

The most questionable action was the second assessor, who is also the tax collector, issuing a check to herself without board approval, and then shortly thereafter paying her back taxes that were a similar amount, according to Keel J. Hood, a certified public accountant based in Fairfield. Town officials made deposits without documenting them and recorded payments that never happened, Hood said in his report.

The above link has the full disclaimer of opinion and some more details, worth a read if you have nothing better to do this morning.

To think, you could have saved yourself five years of education and just watched this video:

The below is obviously a joke but peep the comments. What a difference between Deloitte and literally any time EY is mentioned.

As for what we’re working on this week, who knows. I have some Moss Adams drama I forgot to post and I’m hearing there may be some suspicious layoffs happening at PwC. As mentioned above, we’re taking a break from December 24 to January 2, there will be a few new things scheduled to run during that time for people who enjoy reading accounting news in the bathroom on Christmas morning so they don’t have to speak to their family members. The newsletter will be on hiatus during that time and no Footnotes on December 30. I no longer drink so don’t expect a big sappy “thank you for reading, I love you!!” post on New Year’s. I do love you though.

That’s it. Merry Christmas to those who celebrate and I hope all of you get a little much-deserved rest in the coming days. Give me a shout if anything interesting happens.

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