Going Concern

Career Center

What Exit Opportunities Exist for a Big 4 Transaction Services Professional?

Caleb Newquist
March 4, 2011

Welcome to the maybe-we-should-start-pointing-out-who-really-isn’t-winning edition of Accounting Career Emergencies. In today’s edition, a future advisory professional wants to know what kind of exit opportunities he’ll have when he’s had his fill of Big 4.

Need some career advice? Concerned that you’re being unfairly portrayed by someone? Have you recently found a mistake at work and aren’t handling it well? Email us at advice@goingconcern.com and we’ll, at very a tie score.

Onward:

I will be starting at a Big 4 firm in TS this fall. I have seen posts and comments on GC primarily about KPMG’s TS group, and commenters mention a “mass exodus” from TS.

I was interested to know what the exit opps are for people in TS? I have been searching around banking blogs and it seems that TS is not held in high regard in I-banking, so what offers are they receiving?

Sincerely,

Interested Viewer

Dear Interested Viewer,

The advisory space isn’t my strong suit but I’ll take a stab. You’re starting with a “Big 4” but then mention KPMG so I’m not exactly sure where you’re ending up so I’ll keep things fairly general. All of the Big 4 have various services within their TS practices including due diligence in various forms, restructuring, accounting advisory and valuation among others. A common exit opportunity for many in Big 4 TS people is to go to…wait for it…another Big 4 firm. None of these firms have a monopoly on the services offered so if you’ve heard good things about Deloitte as opposed to your living hell at PwC, you may jump at the opportunity to join a rival firm. And we know how the firms like to poach from each other, don’t we?

If that’s not of interest to you, the top consulting shops like McKinsey, Bain & Co., Boston Consulting et al. (check out Vault for their list of the top firms) are a possibility but in reality, not a very good one. These firms like their people with smarts – frightening smarts – and Ivy League degreed. If you’ve got both, you probably already work at one of the best firms. If you’re lucky enough to have one of those two, you might have a chance. If you’ve got neither, than you have virtually have no chance.

You mention I-Banking and again, the odds are against you here if you want to work at the top firms, for the same reasons as we mentioned above. Some more realistic options include due diligence, acquisitions or analysis work for a private equity or hedge fund shop or working in the finance group of a firm with M&A aspirations or that needs other complex transactional analysis.

The other option is that you work for awhile, get an MBA and then try to land the BSD job at McKinsey, Goldman or wherever. Of course hitting the big time after going to a prestigious B-school doesn’t mean your dreams of rainmaking are a lock, so it’s a big risk but obviously many have taken this road and made a decent run.

So, there you have it, Interested Viewer: some ideas, at the very least. Any Big 4 TS types out there with some first-hand accounts of the comings and goings are invited to weigh in at this time. I’ve got to get caught up on the #winning Twitter feed.

News

WeiserMazars Moves into Chicago as Part of Acquisition of LECG Units

Caleb Newquist
March 3, 2011

Earlier this week, we told you about the fire sale that was going down at LECG Corp. LECG was selling off various units to FTI Consulting, Grant Thornton and WeiserMazars to try and pay down a portion of the $27 or so million that they owed on their credit facility. After speaking with Doug Phillips, the managing partner at WeiserMazars, we have learned that the deal has officially closed and few more details about the units they acquired in the deal, including their move into the Chicago market.

As we reported on Monday, WM is picking up five partners and approximately 40 staff from LECG. Mr Phillips told us that “we are very excited” about the transaction and these professionals will join the commercial and insurance audit practices as well as business advisory services. The majority of the new professionals will be located in the firm’s Horsham, PA location while one partner and approximately ten staff will be located in Chicago.

Mr Phillips told GC that this acquisition strengthens WeiserMazars’s “insurance, commercial and business advisory services, as well as solidifies our presence in the Philadelphia market.” Perhaps more importantly, however, is that “[WeiserMazars] now has a presence in the Chicago marketplace,” Mr Phillips aid. This will mark the 9th location for the firm in a key market for a firm that appears to have some wind in its sails after last year’s combination of Weiser and Mazars. We’ll be keeping an eye on them as things progress after this latest move.

UPDATE:
Check out the WeiserMazars press release for more details.

Deloitte

Former Deloitte Partner Jeff Farber Lands Deputy CFO Gig at AIG

Caleb Newquist
March 3, 2011

Not only is Mr Farber a Deloitte audit alum, he also had stints as the controller at Bear Stearns and CFO at Gamco Investors. Today came the announcement that he is still winning, now as the new sidekick to David Herzog.

In this new position, Mr. Farber will provide global leadership and coordination for AIG’s Controllership and Accounting Policy functions, as well as the AIG Global Tax Department. He reports to David L. Herzog, AIG Executive Vice President and Chief Financial Officer.

It’s worth noting that as the a leader and coordinator for global tax department, Farber alone will encompass more oversight than all of Weatherford International.

ANYWAY, back to the boilerplate:

“Jeff Farber is well prepared to help take these key AIG finance functions to an even higher level,” said Mr. Herzog. “Over the past several years the finance team has worked diligently through an extraordinarily complex restructuring, and this new role provides Jeff with an opportunity to lead a great team and work closely with the finance transformation team as we roll out our new financial platform.”

Sounds like a hoot. Best of luck to Mr Farber.

Accounting News Roundup: Twitter Saying No to IPO (For Now); Ken Starr’s Sentence; Wesley Snipes Wants a SCOTUS Review | 03.03.11

Caleb Newquist
March 3, 2011

BP Spill Chiefs Miss Out on Bonuses [WSJ]
Former Chief Executive Tony Hayward, former head of Exploration and Production Andy Inglis and current Chief Executive Robert Dudley will receive no cash bonus for 2010 and no shares under the long-term remuneration plan running from 2008 to 2010, BP said in its annual report to shareholders. Head of Refining Iain Conn and Chief Financial Officer Byron Grote will receive cash bonuses of £104,000 ($169,800) and $207,000 respectively for meeting targets within their own division. This is around 10% of the cash bonuses they received in 2009.

Twitter’s Stone: No IPO or funding talks [Reuters]
Asked about a Financial Times report last week that said a technology fund from JPMorgan was in talks to buy 10 percent of Twitter, Stone said: “(The report is) made up.”

Taxpayers Beat Wall Street as Top Lenders to Clean Energy [Bloomberg]
Government-backed development banks in Europe, Brazil and the U.S. arranged the most funding for clean energy projects in 2010, taking up the slack left by commercial lenders during the credit crisis. The European Investment Bank furnished $5.41 billion of debt for renewable energy projects last year followed by $3.16 billion from Brazil’s state development bank, BNDES, and $2.12 billion from the U.S. Federal Financing Bank, according to an annual survey by Bloomberg New Energy Finance.

Robert Half Professional Employment Report [RHI]
Nine percent plan to increase staff, while 4 percent anticipate declines. The net 5 percent projected increase is unchanged from the first-quarter survey, with most respondents, 86 percent, expecting to maintain current personnel levels.

Starr Gets 7 1/2-Year Prison Sentence for Defrauding His Celebrity Clients [Bloomberg]
Kenneth I. Starr, the money manager whose clients included actors Sylvester Stallone and Wesley Snipes, was sentenced to 7 1/2 years in prison after pleading guilty to defrauding nine celebrities out of $33.3 million.

Ryan Donmoyer Leaves for Ernst & Young [FoC]
Donmoyer covered tax news for Bloomberg out of DC.

Wesley Snipes Seeks Supreme Court Review of His Tax Convictions [TaxProf Blog]
Um…okay.

Going through the motions: Only 1/3 of workers are engaged in their jobs [AW]
But far more are married to their jobs. Strange.

Apparently Lance Armstrong (aka ‘an annoying little man in tights’) Retired from Cycling to Lobby for Higher Taxes

Caleb Newquist
March 3, 2011

I will not apologize for loving the snark coming from Americans for Tax Reform today:

California is one of the most heavily taxed jurisdictions in the world. If that weren’t bad enough, for the next few months Golden State residents will have to deal with an annoying little man in tights pedaling around the state to stump for even higher taxes. Lance Armstrong, who recently retired from professional cycling to lobby full time for higher taxes, was in Los Angeles earlier this week for a press event with California state Senator Don Perata to announce the launch of a campaign to raise the state tobacco tax.

I have to give credit to ATR, they are nothing if not consistent. After all, they are lumping in a cancer survivor with a cancer-fighting nonprofit for being lovers of higher taxes on cigarettes.

Senators Introduce Bill That Would Require IRS to Produce 310 Million (or so) Receipts

Caleb Newquist
March 3, 2011

Plenty of horrendous ideas get introduced inside the hallowed walls of Congress but the latest submission from Bill Nelson (D-FL) and Scott Brown (R-MA) ranks right up there:

Sens. Bill Nelson (D-Fla.), chairman of the Senate Finance subcommittee on Fiscal Responsibility and Economic Growth, and Scott Brown (R-Mass.) introduced the measure Wednesday that would require the IRS to provide each taxpayer with an itemized list, similar to a grocery store receipt, that shows where their payroll and income taxes are spent. “Taxpayers have a right to know where their money goes, how much Uncle Sam is borrowing on their behalf, and what they get in return for it,” Nelson said.

Yeah, no problem. New responsibilities under healthcare reform, chasing offshore accounts, not to mention your everyday tax compliance and enforcement. This will be a piece of cake since the the Service’s budget is getting slashed.

Senators introduce bill that would provide detailed tax receipt [The Hill]

CFOs

Weatherford CFO Not Taking $500 Million Accounting Error Well; CEO Slightly More Upbeat

Caleb Newquist
March 3, 2011

~~WTF~~ WFT CFO Andrew Becnel needs a hug:

Weatherford International Ltd. Chief Financial Officer Andrew Becnel called a $500 million accounting error disclosed by the oilfield-service company late Tuesday an “embarrassment,” the damage of which is “impossible to quantify.”

But you know who’s taking this whole snafu in stride? CEO Bernard Duroc-Danner that’s who! BDD told investors on a conference call today that nothing is fucked and that this will all be yesterday’s news in no time:

Chief Executive Bernard Duroc-Danner said there is no risk of a U.S. government investigation or of any tax penalties or fines related to what he characterized as a mistake in calculating the tax rates on dividends moved from one subsidiary to another.

Geez. Give the SEC some credit wouldja? Just because they missed a few things here and there doesn’t mean they won’t ask any questions about your material weaknesses.

Weatherford Finance Chief Calls Accounting Error an ‘Embarrassment’ [WSJ]

WFT’s Material Weaknesses Led to Giant Tax WTF

Caleb Newquist
March 2, 2011

It’s bad enough that 3% of Weatherford International’s revenues come from Libya, Egypt, Tunisia, Yemen and Bahrain but the company also revealed in a their NT 10-K filed yesterday that they aren’t so good at staying top of their taxes:

The Company’s Annual Report on Form 10-K (the “Form 10-K”) for the year ended December 31, 2010 cannot be filed within the prescribed time period because the Company has identified a material weakness in internal controls over financial reporting for income taxes and requires additional time to perform additional testing on, and reconciliation, of the tax accounts to be included in the annual financial statements to be presented in the Form 10-K. The Company expects to file the Form 10-K on or before the 15th calendar day following the prescribed due date.

FuelFix has the gory details:

Oil field services firm Weatherford International goes by the stock ticker is WFT, but analyst reaction to the company reporting more than $500 million in tax errors is more likely drawing the reaction of “WTF?” from investors.

The company said it will have to restate its earnings going back to 2007 due to “material weaknesses” in its internal controls, namely:

1. inadequate staffing and technical expertise within the company related to taxes,
2. ineffective review and approval practices relating to taxes,
3. inadequate processes to effectively reconcile income tax accounts and
4. inadequate controls over the preparation of quarterly tax provisions.

So in other words, Weatherford has no tax experts in their accounting department, no one to supervise or review the work of those experts and no checks or balances over the tax provision process as a whole. Was the Ernst & Young audit team aware of this? Last year’s 10-K had a clean opinion, in case you were wondering. Oh, and Weatherford moved its HQ to Switzerland back in ’08. So there’s that.

Oops: Weatherford reports $500M tax error [FuelFix]

BREAKING: Tax Reform Will Be a Long Process

Caleb Newquist
March 2, 2011

Yesterday in a Senate Finance Committee hearing, Senator Max Baucus (D-MT) said that he would like a “weekly set of get-togethers” to address reforming our tax code. You see, Baucus was having similar weekly hearings for two years leading up to the healthcare reform bill that was passed last year. And since those were such a hoot, he figures attacking a equally polarizing issue like tax reform will demand a similar strategy. However, witnesses before the committee – all former assistant Treasury secretaries for tax policy – warned that this debate will likely haunt our dreams and news cycles for a long time:

Fred Goldberg, Jonathan Talisman, Mark Weinberger, Pamela Olson and Eric Solomon discussed, among other issues, the difficulties in crafting a revenue-neutral tax reform plan; problems with the alternative minimum tax and the tax exclusion for employer-provided healthcare; and issues with double taxation in the corporate code.

The former Treasury officials also declared that any successful overhaul of the tax code could take several years and would require leadership from the Oval Office.

Now for the older crowd, the long arduous process of tax reform harkens you back to days of when Charlie Sheen was winning by dodging…er, Charlie in Platoon. For many of the Millennials, well, you were all a lot cuter back then.

“We saw that in 1986,” Weinberger said. “President Reagan at the time made it his No. 1 domestic policy initiative and it still took over two years and failed three times before it was ultimately enacted into law.”

Baucus wants weekly tax reform hearings [On the Money/The Hill]

Technology

Intel’s Thunderbolt Makes FireWire Look Like Your Grandma on the Freeway

Adrienne Gonzalez
March 2, 2011

Sick of staring at your computer screen watching the data crawl by? Stare no longer, the future of data transfer is here with Intel’s new Thunderbolt™ technology:

From the company with the fastest processors comes the fastest way to get information in and out of your PC and peripheral devices. At 10 Gbps, Thunderbolt™ technology gives you great responsiveness with high-speed data and display transfers in each direction—at the same time. With a single cable, connecting a PC to multiple devices is simple, making it easy to get and see what you want, when you want it. Thunderbolt technology gives you incredible flexibility; high performance expansion is just a cable away for new and novel uses, now and in the future.

Intel boasts that you can transfer a full HD movie in less than 30 seconds or backup an entire year of continuous mp3 playback in around 10 minutes using this technology.

Thunderbolt is bi-directional and allows for daisy-chaining, making that tangle of USB cords hanging off your desk obsolete, as soon as hard drive storage size necessitates lightning-fast data transfer, that is.

New MacBook Pros come equipped with Thunderbolt ports but for the rest of us, it’ll be USB for the foreseeable future until PC technology catches up and new laptops begin shipping with bolts emblazoned on the side.

Just think how many years of SOX-compliant data you can transfer away from prying eyes no sooner than the front desk says “the PCAOB is here!”

Accounting News Roundup: IRS Commish: Budget Cuts Will Help Tax Cheats; Date Set for International CPA Exam; The 16th Turns 98 | 03.02.11

Caleb Newquist
March 2, 2011

IRS Chief Tells U.S. Lawmakers House’s Spending Cuts Would Help Tax Cheats [Bloomberg]
The House spending bill for the rest of fiscal 2011, which is opposed by Senate Democrats and President Barack Obama, would cut $603 million from the IRS’s fiscal 2010 spending level of $12.1 billion, Shulman said. Those cuts would cost the government $4 billion in collected revenue, Shulman said. The hearing highlighted the conflict between the House Republican majority’s push to reduce spending and the Obama administration’s proposed funding increases for some agencies, including the IRS.

Gregg Clark rejoins Ernst & Young LLP as Americas Consumer Products Leader for Advisory Services [PR Newswire]
“We are thrilled that Gregg has decided to re-join the firm in this new role,” says Bryan Segedi, Vice Chair of Advisory Services at Ernst & Young LLP. “His experience in the areas of M&A, business and IT strategy, e-business and supply chain management make him a vital asset to the Advisory Services Practice and allows us to expand on the services already offered to our consumer products clients.”

CPA Exam Slated for International Debut in August [JofA]
Japan, Bahrain, Kuwait, Lebanon and the UAE join the fun.

Charlie Sheen And Public Company Disclosure [Forbes]
CBS and TimeWarner don’t appear to be winning. Should they be disclosing?

Big Four domination creates dearth of expert witnesses [Accountancy Age]
A lack of non-conflicted expert accounting witnesses could impact on the ability to bring litigation against the biggest firms. The Joint Disciplinary Scheme, the accountants’ watchdog that has issued its last annual report after completing its caseload, warned that the “near monopoly” of Big Four audits of the FTSE 350 meant it was difficult to find expert accounting witnesses to help in tribunals.

HMV lenders set to appoint Deloitte over debt talks [FT]
Lenders to HMV Group, including state-backed banks Royal Bank of Scotland and Lloyds Banking Group, are about to appoint Deloitte to advise them in talks over the group’s debts, according to people familiar with the situation. The decision to appoint financial advisers came as the embattled music and entertainment retailer warned on Tuesday that it would miss analysts’ expectations for full-year pre-tax profits of £45m because of a continued “challenging” trading conditions.

Happy Tax Day (er, Sort Of) [Tax Girl]
Memo to Tax Deniers: The 16th Amendment turned 98 yesterday.

News

Does Hollywood Always Portray Accountants as ‘Pathetic’ or ‘Despicable’?

Caleb Newquist
March 2, 2011

That’s the question put forth by a reader across the pond to the group and since the Academy Awards have come and gone with nothing more than the cliché PwC jokes, it seems worth discussing.

But first, the Brit with the beef:

I watched the brillant [sic] Untouchables yesterday. This triggered the point about portryal [sic] of accountants by Holloywood [sic]. It is very poor in comparision [sic] to other professions.

Most accountants in the movies are either pathetic (think Rick Moranis in Ghostbusters) or despicable (Ed Begley Jr. as the sleazeball accountant who crosses a vengeful Roseanne Barr in She-Devil).

Other professions like, firefighters, doctors, and lawyers (Julia Roberts in the Oscar-winning Erin Brockovich), get their fair share of heroic roles. But when it comes to accountants we are pushed aside.

Well, for starters, comparing the work of firefighters and doctors to accountants makes as much sense as sending a team of interns into an audit committee meeting. If you’re looking for heroics, there are few opportunities for accountants in Hollywood; even a crook-turned-crime-fighter like Sam Antar would be a anti-hero at best. One exception would be Ben Kingsley as Itzhak Stern in Schindler’s List.

As for Morris in Ghostbusters, he scores with Annie Potts in Ghostbusters 2, so that hardly qualifies as pathetic. As for motive behind the unflattering portrayals, maybe enough people working in Hollywood have been ripped off by their own accountants that a slight vein of villainy is always written into their characters. The most recent muse being Ken Starr.

Despite that possibility, there are plenty of accountants in film that we like:

• Thandie Newton as Stella in RocknRolla

• Leo Bloom in The Producers (Wilder or Broderick, take your pick)

• Danny Glover as Henry Sherman in The Royal Tenenbaums

• It’s on the small screen but George Wendt as Norm Peterson on Cheers

Whether you see these characters as flattering or not, is your call but their awesomeness is not in question (I’m partial to Stella, frankly). We’re missing some, surely, so feel free to chime in with others.

Careers

Big 4

News

Technology

Practice Management

Site Search

Twitter Feed

Get the Accounting News Roundup

Quick Reads

Sponsored Content

Get the Accounting News Roundup

Remote Bookkeeping, Accounting, Tax and Audit Positions

AO: Senior Accountant, Advisor

Remote Tax Advisor, CPA Firm

Remote Bookkeeping, Accounting, Tax and Audit Positions

AO: Senior Accountant, Advisor

Remote Tax Advisor, CPA Firm