Good morning, faithful capital markets servants. Today is February 5, 2024 and we are getting into some news.
Financial Advisor says many accounting firms want to get on the wealth management bandwagon “to serve clients better” but of course really “wealth management practices can be quite profitable when done well.” Guess what? A lot of them aren’t getting the “done well” part.
Most Wealth Management Practices Are Unsuccessful
In a survey of 328 senior partners at accounting firms with 10 or fewer partners with wealth management practices, 55.2% reported these practices were unsuccessful. This means their wealth management practices did not meet the firm’s expectations, not that they did not help them serve clients better or make money. These senior partners are responsible for their firm’s wealth management efforts.We can conclude that many accounting firms’ wealth management practices are not achieving the expectations and goals of the accountants. Meanwhile, 31.1% of the senior partners reported that their wealth management practices were moderately successful, and only 13.7% said their wealth management was very successful.
Among the senior partners who say their efforts are unsuccessful, 86.7% question whether they have a suitable business model to deliver wealth management services and products.
The Mandarin has a PwC tax scandal update, apparently they filed their required compliance report early so staff could be off for the holidays.
PwC submits homework before Christmas
Accounting firm PwC was busy getting its homework into the Tax Practitioners Board before Christmas so its staff could take off on leave without worrying about the regulatory lodgement.
The firm is required to lodge a six-monthly report documenting its compliance with the TPB order received in 2022 that demanded it tidy up its conflict monitoring processes and ensure staff were properly trained on conflict and confidentiality matters.
PwC’s first compliance report was lodged in July last year but its second — dated 18 December 2023 — was sent in almost a month before the deadline.
“Under item 4 of the TPB Order, PwC AU must provide a compliance statement to the Board every six months confirming the items set out in the TPB Order. This report relates to the six-month period from 1 July 2023 to 31 December 2023 (the Reporting Period),” an executive summary signed off by Jan McCahey, the lead risk and ethics partner, says.
“The report is due on 14 January 2024 but is being submitted early as PwC will be closing its offices for the Christmas period between 22 December and 8 January and many personnel will take extended leave in January.”
Los Angeles Business Journal profiled some homegrown artisan accountants. One of them is Matt Segal, is a business manager with more than 15 years of experience in the entertainment industry working with athletes, entertainers and high-net-worth individuals at the Westwood-based NKSFB, the largest independent accounting firm headquartered in Los Angeles and one of the most prominent Hollywood firms. Here’s what he had to say about talent:
How are you finding and retaining new talent as the number of U.S. accounting grads continues to drop?
Actually, for our business, the employment market has substantially improved. With the decrease in complete remote working opportunities, more employees are in the marketplace, and it has become easier over the last 12 months to hire talented people.
And across the country, the Hartford Business Journal talks about old-timers needing to exit the business and not having any young people to pass the bag to.
As founding partners in small accounting firms age, they are faced with few options for retirement.
Some can pass the company down to an up-and-coming partner, but a continuing workforce shortage in the accounting industry means fewer young people are joining the profession or moving up the ranks.
As a result, many smaller firms run by aging Baby Boomers are looking for merger opportunities with larger outfits, a trend that shows no signs of slowing, industry experts said.
Drew Andrews, managing partner and CEO of Hartford-based accounting and consulting firm Whittlesey, said the main factor driving mergers is the significant number of smaller firms with aging partners who are looking toward retirement, but don’t have the “backup” on staff to fill their shoes.
I love it so much when someone’s promotion gets announced in the local paper. Here’s a guy who started interning at a Minnesota firm in 2013 who just made partner. Congrats, Jordan.
Westberg Eischens has promoted Jordan Smith to partner, according to a news release from the public accounting and advisory firm.
In this position, he will expand his leadership role earned in his 10 years with the firm.
Smith first joined the company in 2013 as an intern while he was in college. The next year he was hired as a staff accountant and worked with audits, reviews and compilations.
After passing the certified public accountant exam in 2021, Smith was promoted to manager, focusing on audit engagements for employee benefits and governmental entities.
Nice to see Meet the Firms has made a comeback after the pandemic tried to kill it off.
Elon University’s Student Professional Development Center will host the Accounting Meet the Firms event on Feb. 6 that promises to shape the future of first- and second-year accounting majors.
Deloitte Canada wants to get more Indigenous business:
Deloitte Canada wants to shift its relationship with Indigenous Nations from its present auditing and trust fund dealings to a holistic approach that will support Indigenous governments to claim jurisdiction and participate more fully in the national economy.
They call this new approach, launched Jan. 31, Nation Building.
“We don’t own the term ‘nation building.’ Nobody does,” said Jolain Foster, managing partner of Nation Building with Deloitte, a company that provides services and advice globally in the financial and tax fields.
“In talking with our Indigenous leadership team, we really wanted to make clear, to us, what does that mean over the next while? And we came up with this sort of formula that is nation building.”
This new approach will shift Deloitte from working on a micro transactional level with Indigenous Nations to working on a macro level or on a larger scale.
“What is going to be telling and what we need to do is to really focus in the areas where we have expertise that (Deloitte) can bring to the table and amend our approaches to work for nations and then also invent and create and innovate new solutions with nations that will work,” said Foster.
EY’s pension and retirement leader is leaving:
Josef Pilger, global pension and retirement leader at Ernst & Young, will be leaving the firm.
Pilger confirmed in an email that he will be moving back to Australia “later this month for family reasons.”
Regarding his successor at EY, Pilger said in the email the firm is “going through the normal internal processes to work out who will take over my role.”
Why do Mr. Pilger’s glasses look poorly Photoshopped on?
Remember how EY lost another client to the burning loins of a partner recently? Apparently the client has a new auditor. That would usually be non-noteworthy but The Standard felt it necessary to point out that the new auditor’s office is adjacent to a shredding business.
So who is replacing them? Spy did some digging on the brothers’ glamorous new audit appointment at Leon, a firm known as PM+M.
Where are they based? Unlike EY and KMPG [sic], PM+M is not run out of a shiny skyscraper in Canary Wharf, wedged between investment banks and asset managers. Instead, it is headquartered in a business park just off the A6119 in Blackburn.
It’s just up the way from a firm called ‘Lancashire Confidential Shredding’ – a handy spot for the Issas to tear up those old big-four contracts.
KPMG Canada released a survey:
As Canadians mark Black History Month, new research by KPMG in Canada finds that Canadian companies have continued to make progress over the past year to create a more equitable and inclusive workplace for their Black employees. Yet, eight in 10 Black Canadians say they are still facing some form of racism or microaggression at work.
“In our third survey in as many years, Black Canadians feel that Corporate Canada is making headway in meeting their 2020 commitments to end anti-Black racism, create more inclusive workplace environments and promote more Black people to leadership roles,” says Elio Luongo, CEO and Senior Partner, KPMG in Canada. “However, despite these efforts, more than 80 per cent of Black Canadians faced racism in the workplace last year, nearly a 10 per cent increase from what we found a year ago.”
- 83 per cent of Black Canadians say their employer has made progress on their promises to be more equitable and inclusive for Black employees over the last year
- 83 per cent also see visible progress being made within their company to build a pipeline of Black talent with the goal of promoting them into the C-Suite
- Compared to four years ago, over three-quarters (76 per cent) say their company now has a Black person in the C-suite or on the Board of Directors
Opinion asks “where were the auditors?” in “KPMG can only ‘begin to atone’ for its role in VBS corruption by playing open cards with the public“:
While the brunt of society’s anger must be directed towards those leading this plunder of public and pension funds, we must also ask where were the auditors during this chapter of shame in the nation’s history?
Auditors are the products of universities, are required to register with their professional body and are called upon not to treat their career as just another job but in fact a public calling, albeit a well-paid one.
Not kidding, it’s written by “Opinion.”
I think that’s plenty for you to chew on today, it is Monday after all and you’ve got to take it slow to prevent shocking your system. Have a great week, holla if you need me, blah blah. Find us on Twitter @going_concern, me at @inkywretch.
Grassley Airs Concerns As Vote Nears on Financial Bill [