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Apparently Shouting “Promote Me! Promote Me!” in a Partner’s Face Can Get You Promoted at Deloitte

Over in Ireland there's a case before the Workplace Relations Commission (WRC) right now that may be of interest to our readers, our readers being people who are all too…

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AI Will Be EY Auditors’ New BFF, According to EY

While staff in tax at EY US will soon be spending more time with their flesh-based colleagues due to a return-to-office mandate that requires them in the office for an…

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Once Again, a Mid-Tier Firm Beat Out Big 4 on This ‘Best Companies’ List

Fortune has released its Best Companies to Work For list for 2026 and we just realized we didn't cover it at all last year. Shrug, it's all just marketing anyway.…

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Layoff Watch ’26: The King’s KPMG Kindly Asks 600 Auditors to GTFO

We covered this story in yesterday's Monday Morning Accounting News Brief but it's significant enough news to earn its own spot in a separate article as it's a large market…

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A KPMG Senior Director Got Beat Up By a Guy Who Stars in Reacher

Oh my God it feels like it's 2010 all over again with that headline. Thanks to the algorithm for putting this item in my feed since no one saw fit…

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News

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Friday Footnotes: Feds Get a Tax Preparer in Their Biggest Pandemic Relief Bust Yet; AI Is Coming For Offshore Busy Work | 4.10.26

Footnotes is a collection of stories from around the accounting profession curated by actual humans and published every Friday at 5pm Eastern. While you're here, subscribe to our newsletter to…

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illustration collage of stressed woman at work

Apparently Shouting “Promote Me! Promote Me!” in a Partner’s Face Can Get You Promoted at Deloitte

Over in Ireland there's a case before the Workplace Relations Commission (WRC) right now that may be of interest to our readers, our readers being people who are all too…

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Monday Morning Accounting News Brief: You Can’t Spell Audit Without AI; An Elaborate Scheme to Defraud the Air Force | 4.6.26

Hey. To our readers in tax let me just say you're doing great! Almost there! For everyone else, hopefully you're hanging in there as well. To everyone: be sure to…

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Friday Footnotes: EY Tells Tax to Get Back in the Office; Associates Are Vibe Coding Now | 4.3.26

Footnotes is a collection of stories from around the accounting profession curated by actual humans and published every Friday at 5pm Eastern. While you're here, subscribe to our newsletter to…

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Layoff Watch ’26: The King’s KPMG Kindly Asks 600 Auditors to GTFO

We covered this story in yesterday's Monday Morning Accounting News Brief but it's significant enough news to earn its own spot in a separate article as it's a large market…

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Technology

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AI Will Be EY Auditors’ New BFF, According to EY

While staff in tax at EY US will soon be spending more time with their flesh-based colleagues due to a return-to-office mandate that requires them in the office for an…

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ICYMI: According to This AI CEO You Won’t Have to Go to Work in a Year

Commence to fantasizing about what you'll do with all that glorious free time when you lose your job to AI in 12-18 months because that's the confident prediction made by…

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Another Early AI Accounting Startup Just Bit the Dust

TIL that early AI accounting platform Botkeeper has died. I found out via this CFO Brew article which pointed to a post on Botkeeper's own site. Turns out r/accounting was…

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KPMG Brings Cheating Into the AI Age By Using AI to Cheat on AI Exams

The image is upside down because Australia. This story sounds like a joke but we assure you it is not. KPMG Australia has expanded KPMG's storied cheating repertoire by being…

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KPMG Brings AI Talking Points to a Fee Negotiation, Inadvertently Opens a Pandora’s Box Filled With Stingy Clients

As reported by Financial Times on February 6, included in Friday's edition of Footnotes, and widely chuckled at by public accountants both current and former across the world since, KPMG…

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Practice Management

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Top Remote Tax and Accounting Candidates of the Week | October 16, 2025

Struggling to Find Remote Accounting or Tax Talent? We’ve Got You Covered.If your firm or internal team is having a tough time sourcing qualified remote tax and accounting professionals, you're…

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Top Remote Tax and Accounting Candidates of the Week | October 2, 2025

Struggling to Find Remote Accounting or Tax Talent? We’ve Got You Covered.If your firm or internal team is having a tough time sourcing qualified remote tax and accounting professionals, you're…

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Top Remote Tax and Accounting Candidates of the Week | September 25, 2025

Struggling to Find Remote Accounting or Tax Talent? We’ve Got You Covered.If your firm or internal team is having a tough time sourcing qualified remote tax and accounting professionals, you're…

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Top Remote Tax and Accounting Candidates of the Week | September 18, 2025

Struggling to Find Remote Accounting or Tax Talent? We’ve Got You Covered.If your firm or internal team is having a tough time sourcing qualified remote tax and accounting professionals, you're…

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Top Remote Tax and Accounting Candidates of the Week | September 4, 2025

Struggling to Find Remote Accounting Talent? We’ve Got You Covered. If your firm or internal team is having a tough time sourcing qualified remote tax and accounting professionals, you're not…

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Here Are Tax and Audit Salaries at Top 25, Top 300, and Regional Firms

Recruiting firm Brewer Morris has released its 2025 US CPA salary guide and should you want to read the whole thing you can request it from them here. Perhaps you,…

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Friendly Reminder Not to Work Yourself to Death For This Profession

Saw this on the bird app yesterday and thought its message would be worth passing along what with 20 days remaining until April 15 and nerves as strained as ever…

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Accounting Firm Abruptly Nopes Out of Tax Season Early (UPDATE)

Ed. note: An earlier version of this article's headline stated the sheriff is investigating. The Alexander County Sheriff's Office informed us they are not investigating, only fielding calls from the…

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This Deloitte Office Has Eliminated Trash Cans at Desks to Make Staff Get Up Off Their Asses

Boston Business Journal wrote an article about Deloitte's new office in Boston and for some reason they chose to lead with this: You won’t find trash cans at the desks…

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The IRS Decided to Troll Tax Pros For 10/15

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Top Remote Accounting Freelancers: February 3, 2024

Looking to staff up for a season or hire a freelancer for a project? Accountingfly is ready to partner with you! Gain full access to a pool of highly skilled…

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10 Essential Project Management Principles for Accounting Firms

Every accounting firm struggles with project management, with smaller practices that are rapidly expanding taking the brunt of the damage. As your firm adds new clients, takes on more work,…

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6 Ways Email is Secretly Destroying Your Accounting Firm

Email: The word itself sounds innocent, doesn't it? Kind of like "snail mail," but faster, sleeker, and without the slimy trail. But don't be fooled—email is secretly a sinister beast,…

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Don’t Grow Your Accounting Firm Out of Business! Break Up With These Unscalable Practices Now

Business growth is always a high priority for accounting firms, especially small-to-midsize practices. Take care, though, because growth can be a double-edged sword. If your firm expands too quickly or…

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Willing But Not Always Able: The Latest on Small Business Lending

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

We hear a lot from small businesses about how hard it is to get a loan and a lot from bankers that demand from credit-worthy borrowers is down. Now a new study provides insights into the situation, by exploring the top reasons why banks are turning down applicants, along with plenty of other data. And because it includes asset-based lenders and other funding sources, it offers a wider view of just what’s going on in the financing landscape.

The study, from researchers at Pepperdine University, surveyed 1,430 borrowers, lenders and investors, looking at changes over the past six months. Since the most detailed analysis focused on banks and asset-based lenders, here’s a look at the most salient points:


Banks – Demand certainly does seem to be down, judging from responses from the 56 banks studied. About 11 percent reported an increase in applications over the past six months compared to 77.2 percent who had a decrease. But the quality of borrowers is up, according to 55.6 percent of those surveyed. That’s compared to 22 percent who reported a drop. And the number of approvals? That’s gone through the roof. About 76.5 percent reported an increase.
What are the reasons for turning down applicants? Top on the list is quality of cash flow. Almost 25 percent cited that as the reason. And 20.8 percent pointed to quality of earnings.

Asset-based lenders – The 52 asset-based lenders reported the mirror opposite, at least when it comes to demand. Sixty percent had an increase in applications vs. 8.7 percent who experienced a decline. Also while more lenders reported a drop in the credit quality of applicants, a majority saw an increase in the quality of borrowers who were approved.

As you might expect, the top reason for rejecting an application was insufficient collateral (30 percent). “In the weak economic environment, the valuation of collateral is going down,” John Paglia, an associate professor at Pepperdine and author of the study, said to me. Second on the list was quality of earnings (15.8 percent).

What’s it all mean? For one thing, asset-based lenders are attracting more interest from prospective borrowers, but the economy has done a number on their most important criteria, collateral. As for bankers, it seems they’re on the level when they say they want to make loans, but they can’t find suitable prospects.

Apparently when they do get a live one, bankers are more than ready to lend.

While They Were at It, The PCAOB Thought They Might Chime in on Auditors’ Babysitting Skills

As we mentioned late yesterday, the PCAOB has been working hard these days. Late nights, weekends, ordering in and whathaveyou. Adrienne told you about the new eight auditing standards that you’re all expected to have memorized by Labor Day, and we wrapped up with Dan Goelzer snagging QOTD for the Board’s move towards open enforcement proceedings. This move will, presumably, be used in order to shame the pants off of those of you that dare to break the rules.

But the Board had one more thing to serve up yesterday and that was to put it out there that they don’t think too highly of the job auditors are doing supervising the worker bees:

“Through its inspections and investigations, the PCAOB has observed that supervision processes within firms are frequently not as robust as they should be, and that supervisory responsibilities are often not as clearly assigned as they should be,” said PCAOB Acting Chairman Daniel L. Goelzer. “Today’s Release seeks to highlight the Board’s views on the scope for using the authority provided in the Act to address those problems.”

For an industry that depends so heavily on a hierarchal structure, this does not bode well. There are several possible scenarios that led the PCAOB to jump in with their thoughts, including but not limited to:

1. Dozens of audit engagements of publicly traded companies have aloof partners that pop in once or twice a week, observe a handful of staff people feverishly ticking and tying, only to assume everything appears a-okay.

2. The PCAOB has incredible “luck” picking the biggest shitshow engagements.

3. The PCAOB is just blowing the shortage of experienced SAs out of the water.

4. Inspectors don’t buy the “we got this” story from the A1 and A2 running an accelerated filer engagement.

If you’re on one of these free-for-all audits, for crying out loud, get in touch. We want details.

PCAOB Issues Release on Failure to Supervise [PCAOB]

Job of the Day: Bloomberg Needs a Travel Expense Auditor

Bloomberg is looking for an experienced professional to fill a Travel Expense Auditor position in New York.

Qualifications include four to seven years of experience,a CPA is a plus.


Company: Bloomberg

Title: Travel Expense Auditor

Location: New York

Responsibilities: Bloomberg is seeking an experienced expense auditor to perform T & E expense audits and investigate activities that do not comply with program guidelines or Corporate Card policies. Experience in a professional services environment with high volume exposure is a must. The auditor will also, develop and prepare management reporting and analysis of findings. Maintain an up to date understanding of Company T & E expense policies, procedures, and reporting systems. Provide recommendations on procedures, and implement workflow process improvements.Develop and improve internal controls and/or new audit plans to control risk. Monitor T&E trends. Ad hoc project work as directed.

Qualifications/Skills: Bachelors degree in Accounting or Finance; CPA a plus; 4-7 years of audit or related experience in a professional services environment; Advanced knowledge of Microsoft Office (Excel, Word, and Access); SAP system experience is preferred; Excellent analytical skills; Successful organizational skills, attention to detail and follow-through are critical; Excellent written and verbal communication skills and ability to effectively interact with senior management; Discretion is a must as this position works with confidential personal information.

See the entire description over at the GC Career Center and visit the main page for all your job search needs.

Three Things to Remember Come Goal Setting Season

Final reviews are a thing of the past and – at least for some of you – so are the days of terrible raises. Things seem on the up and up at most firms. That said, focusing on FY2011 is crucial for your career. Hopefully the potential for raises will be consistent if not better than this year’s, and but you need to be thinking about everything now.

The typical HR mantra is, “your goals need to be realistic and attainable but should also stretch you to push yourself.”

Yes, finding the middle ground between cruisin’ down Easy Street and setting yourself up for failure is crucial. So, what are you supposed to do?


1. Firm recommended goals: Every firm supplies their employees with suggested goals, and I’ve always recommended that people should use these at a starting point. Why? Two reasons:

a. Your managers and partners know them. While going through performance management training, partners and managers receive the outline of sample goals as part of their training materials. HR says, “Look, these are the goals your staff members should be shooting for” and the room goes “Ahhhhhhhhh.” Using these goals will be familiar to your superiors as you begin the review process. However, it’s important to…

b. Customize the goals to be you As valuable as the sample goals can be as a template for you, it is important that you adjust them to focus on your unique ambitions. This is your opportunity to voice your needs, i.e. – involvement in planning the audit, volunteering at firm events, or getting involved with recruiting. Showing your commitment to the firm away from the day-to-day engagements is just as important as being committed to busy season.

And for the sake of everything holy – PROOFREAD. Passed your CPA this year? Remove all of the passing-the-CPA related questions. Missing details like this will make your superiors question the effort you put into the process; don’t give them that option.

2. Review last year’s goals: Roll-forward successful goals. Re-evaluate goals you didn’t reach or didn’t surpass to your satisfaction. Demonstrating and documenting continual improvement is key.

3. Speak with your mentor: If you were promoted this year, congratulations! Newsflash – you’re in for an incredibly difficult year. New senior staff members and managers are put through the wringer, and rightfully so. Senior management doesn’t like being wrong and weeding out misguided promotions early is important to their long-term planning. Seek out the guidance of at least one person who was in your situation the previous year. What would they have done differently? Did they overshoot on a particular area in their goals? What’s one thing they recommend including in your goal setting?

Still unsure of what you should do? Talk to your peers, flip a coin, or Google it. Whatever you do, don’t miss the submission deadline.

Unless – of course – you actually want to be blacklisted.

Ernst & Young Striving for Fewer “Cookie Cutter” Engagement Teams

E&Y’s annual intern conference invaded Orlando yesterday and the ‘Berg had Director of Campus Recruiting, Dan Black on to discuss Gen Y and why they are pre-tay, pret-tay, pret-tay important to the future of the firm.


Despite their technology savviness, it appears that Gen Y is still relying on rock-paper-scissors as a key decision-making tool. Apparently, darts and jigsaw puzzles are important too.

Oh, and the time you put in as a line cook at Applebees’s in college really doesn’t translate into anything useful so don’t be too concerned about that.

Family Planning and the CPA Exam

For this particular post, as much as I would love to throw my experience with CPA exam candidates and children (sometimes interchangeable, mind you) around, I’m going to do something a little bit different. Would any of you with experience in the following care to weigh in and help?

Here’s the question via a CPA Exam Club member:

I am having a baby in 2 months and wasn’t planning on taking any parts of the exam until 2011, when I will hopefully have more rested nights and energy to study. However, after starting to do research about the CPA exam I discovered all of the changes taking place in 2011 and decided that it seemed prudent to get FAR out of the way in 201and can basically devote all of my time to studying until I have the baby and after I have the baby in order to take the exam in November. I am a pretty disciplined person with good time management. I am pretty quick at getting things done. I also got a 2nd bachelors in accounting and just completed a masters in accounting as well. Do you think I am being unrealistic in my pursuit of passing FAR in 2010?

If you think I can achieve this goal, what do you advise CPA hopefuls to do in order to pass? I am very determined to try and pass on the first try and would do whatever it takes in order to do so.

First of all, I remember what being 7 months pregnant felt like and while I loved being pregnant with my son, at that point the very last thing I would have been able to do would have been to study. So my first piece of advice not just to our little CPA exam candidate friend above but all of you with family plans on the horizon is to WAIT until you have passed the CPA exam to start cranking out the tax deductions. The exam is hard enough on its own, add a career and kids into the mix (especially for Moms) and you have a recipe for disappointment. Or at least a nervous breakdown, which you probably don’t want either.

I often tell candidates to be prepared for any and every possible thing to go wrong and mess up their perfect plans along the way. For parents, it’s almost a guarantee that even our best-laid plans will somehow be ruined, delayed or otherwise compromised.

Discipline is a requirement to get through the exam but even your best intentions can’t fight the inevitable. I could barely function once my son was born (waking up every 2 hours to feed will do that to you), let alone actually do anything productive.

So my advice to you is to wait. Wait until your child is a little older (or at a minimum sleeping through the night) and hopefully you have a supportive partner who will happily babysit while you head off to live CPA review classes. I can’t tell you how many Moms I have seen in live classes, most of whom refuse to take advantage of the convenience of online, on-demand review simply because they are desperate for a break. You know it’s bad when you’d take 8 hours of government and non-profit accounting over being at home with your brood but let’s face it, this Mom thing is the world’s roughest gig.

It sounds to me like you have a plan and that’s awesome but be sure you are being realistic. It’s already almost September, meaning the last window of 2010 is close upon us and if you haven’t already made an appointment at Prometric, you might run yourself into the ground trying to squeeze FAR in (that’s if you can even get in to schedule). And let’s just say you pass (which I’m confident you will once you get off the ground) and then have the baby. What happens when motherhood takes its toll and you aren’t able to resume studying until your child is a year old and your 18 month window is fast approaching?

Enjoy these last two months, take care of yourself and bask in your baby once he or she arrives. The exam will be here waiting patiently in the meantime and by then maybe the AICPA BoE will have ironed out all the IFRS kinks or thrown out new content altogether. Trust me, the changes next year are not that big of a deal and CBT-e will actually be easier than 2010’s exam if I’m guessing correctly (I usually do). You will put in no more effort in 2011 to pass than you would have in 2010 so better to spend the energy when you actually have it instead of running yourself into the ground at a time when you need to be in fighting shape.

Hope that helps!

If you have a CPA exam question for us, get in touch and we’ll do our best to answer.

Accounting News Roundup: Signs That You Should Quit Your Job; District Court Issues Order in Wesley Snipes Tax Case; LarsonAllen Moves Into the Northwest | 08.06.10

BP Completes Cementing Macondo Oil Well From Top [Bloomberg]
“BP Plc completed a cement plug at the top of its Macondo well in the Gulf of Mexico, sealing off the source of millions of gallons of oil spewed into the sea after a drilling rig exploded in April.

The procedure completes the so-called t stage for BP is to finish a relief well to inject cement at the bottom and ensure there’s no leakage inside the 13,000-foot-long (3,962 meters) well bore beneath the seabed, National Incident Commander Thad Allen said yesterday.”

Ten Signs It’s Time to Leave Your Job: The Finance Edition [FINS]
Check yourself for some of these symptoms: “You’ve been holding back from voicing your grievances.”; “You have no clue where the company is headed.”; “You start to believe you can’t do better.”

And that’s just in the first five listed.

Altus completes PricewaterhouseCoopers deal [Bloomberg BusinessWeek]
PwC sells their real estate appraisal management for, what we can only assume to be, a decent chunk of change.

H&R, Jackson Hewitt shares fall on new IRS rule [Reuters]
“Shares of top two U.S. tax preparers H&R Block Inc (HRB.N) and Jackson Hewitt Tax Service Inc (JTX.N) fell Thursday on the Internal Revenue Service’s decision to eliminate debt indicator for tax-refund loans.

On Thursday, the IRS said starting with next year’s tax filing season it will no longer provide tax preparers and associated financial institutions with ‘debt indicator,’ which is used to facilitate refund anticipation loans (RALs).”


PKF Pacific Hawaii completes purchase of Grant Thornton Honolulu office [Pacific Business News]
Name goes official on Monday. Here’s our original report from back in May.

Two UHY LLP Partners Recently Named to Prominent Standard-Setting Implementation Groups [Market Wire]
“The national CPA firm of UHY LLP announced today the recent appointment of Houston-based partner Ana Denena to the International Accounting Standards Board’s (IASB) Small and Medium-sized Entities Implementation Group. In a separate appointment, the firm announced that Maryland-based partner Jennine Anderson was named to the Financial Accounting Standards Board’s (FASB) resource group on non-profit entities.”

PCAOB Adopts New Risk Assess. Stds; Issues Release on Failure to Supervise [FEI Financial Reporting Blog]
As we mentioned yesterday, the PCAOB has been busy. Francine McKenna guest-blogged over at FEI and gives the rundown.

Fannie Quarterly Loss Is Smallest Since 2007 [WSJ]
FTW? “Fannie Mae posted a $1.2 billion net loss for the second quarter, the smallest loss in three years, amid signs that the massive wave of souring loans that brought down the mortgage-finance giant may be easing. But Fannie still asked the U.S. government for an additional $1.5 billion.”

District Court Issues Order in Snipes Case [TaxProf Blog]
Just when you thought it was over.

If you’re not getting cloud computing you’re a loser [AccMan]
That is, you’ve got almost nothing to lose by going for it.

Midwest accounting firm buying LeMaster Daniels [Spokesman-Review]
LarsonAllen brings its business to the northwest by purchasing Spokane-based LeMaster Daniels.

Deloitte leadership race reduced to two hopefuls [Accountancy Age]
“he contest to replace John Connolly as leader of Deloitte in the UK will involve just two members of the firm’s board.

The contenders vieing for the top job are Martin Eadon, head of audit, and David Sproul, head of tax. Sproul joined Deloitte when the firm acquired Andersen in the UK on the back of the Enron crisis

Both candidates gave presentations at the firm’s partner conference on 6 July but no further campaigning is expected.”

Somebody Has Been Busy: PCAOB Issues Eight New Audit Standards

Since the PCAOB was only up to Audit Standard 7 last time we checked and seems to take the conservative approach when it comes to issuing new ones, we have to say we were more than shocked to see them almost double their audit standards overnight. Gee, must be serious.


Via the PCAOB:

The Public Company Accounting Oversight Board today adopted a suite of eight auditing standards related to the auditor’s assessment of, and response to, risk in an audit.

The suite of risk assessment standards, Auditing Standards No. 8 through No. 15, sets forth requirements that enhance the effectiveness of the auditor’s assessment of, and response toial misstatement in the financial statements.

The risk assessment standards address audit procedures performed throughout the audit, from the initial planning stages through the evaluation of the audit results.

“These new standards are a significant step in promoting sophisticated risk assessment in audits and minimizing the risk that the auditor will fail to detect material misstatements,” said PCAOB Acting Chairman Daniel L. Goelzer. “Identifying risks, and properly planning and performing the audit to address those risks, is essential to promoting investor confidence in audited financial statements.”

What does this mean for auditors? Let’s check them out.

AS No. 8 – Audit Risk. This standard discusses the auditor’s consideration of audit risk in an audit of financial statements as part of an integrated audit or an audit of financial statements only. It describes the components of audit risk and the auditor’s responsibilities for reducing audit risk to an appropriately low level in order to obtain reasonable assurance that the financial statements are free of material misstatement.

AS No. 9 – Audit Planning. This standard establishes requirements regarding planning an audit, including assessing matters that are important to the audit, and establishing an appropriate audit strategy and audit plan.

AS No. 10 – Supervision of the Audit Engagement. This standard sets forth requirements for supervision of the audit engagement, including, in particular, supervising the work of engagement team members. It applies to the engagement partner and to other engagement team members who assist the engagement partner with supervision.

AS No. 11 – Consideration of Materiality in Planning and Performing an Audit. This standard describes the auditor’s responsibilities for consideration of materiality in planning and performing an audit.

AS No. 12 – Identifying and Assessing Risks of Material Misstatement. This standard establishes requirements regarding the process of identifying and assessing risks of material misstatement of the financial statements. The risk assessment process discussed in the standard includes information-gathering procedures to identify risks and an analysis of the identified risks.

AS No. 13 – The Auditor’s Responses to the Risks of Material Misstatement. This standard establishes requirements for responding to the risks of material misstatement in financial statements through the general conduct of the audit and performing audit procedures regarding significant accounts and disclosures.

AS No. 14 – Evaluating Audit Results. This standard establishes requirements regarding the auditor’s evaluation of audit results and determination of whether the auditor has obtained sufficient appropriate audit evidence. The evaluation process set forth in this standard includes, among other things, evaluation of misstatements identified during the audit; the overall presentation of the financial statements, including disclosures; and the potential for management bias in the financial statements.

AS No. 15 – Audit Evidence. This standard explains what constitutes audit evidence and establishes requirements for designing and performing audit procedures to obtain sufficient appropriate audit evidence to support the opinion expressed in the auditor’s report.

Now don’t get me wrong, I love rules and regs as much as the next girl – if not more – but I am of the thought that users of financial statements would be better served not by more rules and regs but by a more comprehensive auditor training program that starts in college. Am I asking too much?

Did we really need clarity on audit evidence? The PCAOB seems to think so and that’s fine, they are well-intentioned in their motive and you can’t fault them for that.

Apparently the ‘Wildly Inaccurate’ Accounting at Scott Rothstein’s Law Firm Didn’t Impress Some Miami CPAs

Unless you were born blind and deaf, you may have noticed that South Florida has its share of shady characters. We all know that Berns Madoff frequented the area. Plus there’s the obsessively dapper Lew Freeman, who was Miami’s go-to forensic accountant until he thought he’d just keep his client’s money.

Another model citizen/criminal in FLA is Scott Rothstein. His Ponzi Scheme managed to bring in just over $1 billion and he got 50 years for his trouble. But now the fallout from Rothstein’s little stunt is now raining hell on Miami accounting firm Berenfeld Spritzer Schechter & Sheer.


The trustee overseeing the bankruptcy of Rothstein Rosenfeldt Adler has accused Berenfeld, et al. of funneling $450 million to Rothstein.

As you can imagine, the crew over at BSS&S aren’t thrilled with the accusations and called the suit, “inaccurate and flawed,” and claim that they “conducted [our] duties professionally, conscientiously and in good faith.”

Well, the trustee obviously doesn’t see things that way and laid out several allegations, specifically, the following:

• Berenfeld improperly adjusted RRA’s income by $20 million in 2007 and by $75 million in 2008.

• Berenfeld withheld information from RRA President Stuart Rosenfeldt (who has claimed he had no knowledge of firm finances and couldn’t read a balance sheet).

• Berenfeld prepared tax returns in a way that did not distinguish between RRA operating cash and client trust funds, giving the misimpression that RRA had more available cash than it actually owned.

• Berenfeld did not pursue information about bookkeeping after RRA staff – including CFO Irene Stay and COO Debra Villegas – denied access to information about bank statements, fee income and trust accounts.

• Berenfeld “knew of wildly inaccurate RRA bookkeeping and inadequate accounting personnel evidenced by the way in which books and records were created and maintained, leading to extraordinary adjustments, tantamount to rewriting the books and records of RRA.”

• Berenfeld provided a “nebulous” letter to Rothstein to help cover up $15 million in suspicious transactions in response to an anti-money laundering compliance inquiry from Gibraltar Bank.

Now, we’ve heard that law firms aren’t the best when it comes to running their businesses, but ‘wildly inaccurate bookkeeping and inadequate accounting personnel’ that leads to ‘extraordinary adjustments, tantamount to rewriting the books,’ takes things to a whole new level. Berenfeld employee TerryTracy Weintraub gets special attention in the suit, so we can presume he’s the one responsible for knowing – and not being too concerned – about RRA’s exceptionally shitty books. Oops!

Accounting firm sued over Rothstein work [SFBJ]

IRS Agent/Hero Thwarts Robbery Attempt, Shooting Suspect

This guy/gal is going to get a big slap on the back from Doug Shulman:

An Internal Revenue Service criminal investigations special agent shot and wounded one person during an apparent robbery attempt in San Francisco’s Bayview District overnight, police and an IRS spokeswoman said.


Our hero was apparently on duty at the time which, apparently, isn’t strange:

[IRS Spokeswoman Arlette Lee] said agents are on call 24 hours.

“It is not unusual for IRS agents to be out at different times of the morning or evening,” Lee said.

Lee said IRS special agents carry firearms but could not immediately confirm that the agent involved in the shooting had fired a service weapon.

In other news, IRS Agents also eat but are impervious to coffee.

IRS agent shoots suspect during robbery attempt [Mercury News]

Earlier:
Those IRS Shotguns Are Seeing Some Action

TurboTax Jockey Tim Geithner Says Tax Increases Won’t Hurt Small Businesses a Bit

The top individual tax rate is scheduled to jump to 39.6% on January 1, 2011. To those of us who do private business tax returns for a living, one effect is obvious: this will raise the tax rate on LLC and S corporation income.

But now Treasury Secretary Tim Geithner says that all my small business clientsthy rich law partners and CEOs (my emphasis):

Ninety-seven percent of small businesses in this country would not pay a penny more due to letting these upper-income tax rates expire.

Now some have argued that even if only a few percent of small business owners make over $250,000, these few make up a vast amount of supposedly small business income.

This argument apparently counts anyone who receives any type of partnership or business income as if they were a small business.

By this standard, every partner in a major law firm and every principal in a major financial institution would count as a separate small business. A CEO who has board fees or speech fees would also count as a small business owner under this overly broad definition.

Well yes, Timmy, “some” have argued for that “overly broad definition” — your friends who say 97% of small businesses won’t be affected by the scheduled tax increase. A 2009 report by the Center on Budget and Policy Priorities is a source of the talking point that only a tiny fraction of businesses will be affected by the expiration of the tax increase. They define a small business 1040 as:

…any tax unit that receives any income (or loss) from a sole proprietorship, farm proprietorship, partnership, S corporation, or rental income.

So while a CEO who has board fees will count as a separate small business — as will President Obama, for that matter — so will every taxpayer that has a schedule C, schedule E or Schedule F. Your office Mary Kay girl or Shacklee dealer counts as a small business. Everybody who moonlights and reports their income is a small business. Everybody who rents out a duplex or vacation home counts, as does every taxpayer who holds, even briefly, an interest in a publicly-traded oil and gas partnership.

So how much small business economic activity will be hit by the increase in the top rate? A lot more than 3%. The center-left Tax Policy Center estimates that 44.3% of taxable income of these “small businesses” will be hit with next year’s scheduled tax increase (hat tip: Howard Gleckman). That seems low, if anything, based on what I see in practice.

It’s the successful, growing and profitable S corporations and partnerships that push their owners into the top tax brackets. Growing businesses typically distribute only enough income to owners to cover taxes — either by inclination or by agreements with lenders. Their remaining earnings go into growing the business or paying off the bank. If you increase their taxes, it either reduces growth and hiring or their ability to service their debt — neither of which does much for the economy.

When Tim Geithner says that the only people who will get hit by his tax increase are rich lawyers and director fee millionaires, it may tell us something about his social world. It tells us nothing about how the tax increase will hit business owners.