Going Concern

The Nets’ Latest Attempt to Boost Attendance Is to Offer Free Tax Preparation

Caleb Newquist
March 4, 2010

Okay, who’s got no plans on Friday? Work? Bah. How about you go to the Nets game against the Orlando Magic instead? Sure they’re terrible but you’ll get a coupon that is redeemable at a Roni Deutch Tax Center to get your state return done for free (a $29 value!).

Yes, we said the Nets are terrible but to put it more accurately, they’re atrocious. So atrocious that they have the worst attendance in the NBA. You need your tax return prepared; the Nets need fans. Let’s make this happen. We’re not saying you have to paint your face or anything but show up and drink a beer or two. You can always leave at halftime.

And even if you’re bound and determined to prepare the return yourself, there will Roni Deutch reps at the game to answer your tax questions. Again, free of charge. Of course they’d prefer if you just handed over all your paperwork and coughed up the $185 to have your federal return done too but it’s really about being a fan and supporting the team:

“It’s easy to jump on the Lakers’ bandwagon,” said [Roni] Deutch, who claims to have been the first girl to play Little League baseball on an all-boys team in her home state, California. “The hallmark of a strong company is one that aligns with young companies. I’m a betting woman, and I think the Nets are going to win a championship this decade.”

Write it down.

Nets Will Offer Free Tax Preparation as a Game Promotion [NYT via Yahoo!]

Announcements

A Near-End of Busy Season Celebration Option

GoingConcern
March 4, 2010

Okay, so maybe this seems like a discussion you’re not prepared to have because you’re sleep-deprived, feeling tubby and borderline homicidal but hang in there!

Since we know you need a recharge we suggest you jump over to DB to learn about a little card game that’s going on in AC.

Career Center

Job of the Day: Thomson Reuters Needs a Finance Manager

GoingConcern
March 3, 2010

Thomson Reuters needs a highly motivated and proactive with a strong bias toward action for a Finance Manager position. Responsibilities include contribute to the Company’s Operating Committee review and the quarterly financial reviews for presentation to senior management.

The position requires a minimum of seven years experience and a CPA and/or MBA.

Get more details on this position in New York after the jump.

Company: Thomson Reuters

Title: Finance Manager

Location: New York, NY

Description: The Finance Manager role will provide decision support at the TRM level helping to ensure that the business has full visibility into its financial performance so that it is able to achieve both its short term revenue and OI targets as well as the longer term strategic growth. The regular output will be to contribute to the Operating Committee review and the Qtly Financial reviews these reviews will then drive the ad hoc analysis required by senior management.

Responsibilities: Preparation of the Operating Committee review/Qtly finance review; both data preparation (requires financial systems & excel proficiency) and comprehension & analysis to explain underlying variances, trends and themes for presentation to management; other ad hoc analysis (e.g. deep dive into revenue by type/region driven by the financial results or competitive market factors); develop analyses to help understand key business drivers (e.g.profitability/resource allocation & the presentation of findings via Powerpoint); identification of financial process improvement initiatives; liaison with key members of the finance organization – SBU /functional areas & FPA/Controllership function for data validation

Qualifications: Undergraduate degree in finance, or accounting is preferred and CPA and/or MBA is a plus; proficiency in Excel and Powerpoint; experience of complex issues and able to exercise judgment in evaluating criteria and making decisions; prior management experience desirable; minimum 7 years commercial experience; working knowledge of the Financial Services & Information Solutions industry

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

Investigation Reveals that 30% of Tax Preparers in NYC Lied About Rapid Refunds

Caleb Newquist
March 3, 2010

For whatever reason, people crave their tax refunds like Big 4 recruits crave tchothkes. Accordingly, someone came up with the bright idea of “refund anticipation loans” or rapid refunds. Web CPA is reporting that the New York City’s Department of Consumer Affairs has investigated nearly 800 tax preparers throughout the City and issue over 2,000 citations for violations including illegal advertising of the rapid refunds.

Getting your refund ASAP is the personal mission of every tax-American but if preparers lie about the fact that they’re actually loan sharks, then that’s when the City will get after you:

Consumer Affairs Commissioner Jonathan Mintz noted that RAL costs can amount to as much as a 500 percent interest rate. “The truth is that RALs are such a bad idea that tax preparers and lenders generally need to lie about them in order to sell them,” he said at a press conference Tuesday. “Lying about them in New York is illegal.”

Mintz’s investigators found that three out of 10 tax preparers in the city were misleading their customers about their rights, and in most cases telling them or deceptively advertising that a refund loan was just a rapid refund or a same-day refund. “In the Bronx, over half the preparers that we inspected got it wrong and were issued violations,” he said.

C’mon Bronx tax prep, you’re better than that…

The silver lining in this little story? The City will collect a $1 million and by the grace of God, tax preparers are actually messing up less, as the compliance rate reached 69% in the 2010 investigation up from 65% in ’09 and 56% in ’08.

We here at GC have harped on the upcoming tax preparer regulation, most recently the declaration by the IRS that the new regs are the most important step taken EVER. While that particular statement remains to be hyperbole of the highest order, the new regs will certainly drive these tax prep/loan sharks underground. Whether that’s good or bad depends on your comfort level with black market tax prep services. The IRS doesn’t care; they’ll be coming heavy either way.

NYC Cracks Down on Income Tax Preparer RALs [Web CPA]

Is Deloitte Trying to Ruin Spring Break?

Caleb Newquist
March 3, 2010

We kid, we kid. Deloitte would never want to ruin spring break but they are giving a few students an alternative to drinking themselves blind for a week and possibly getting a bad case of crabs.

The firm is teaming up with the United Way and Teach for America for the third consecutive year to offer “Maximum Impact: Deloitte Alternative Spring Break”.

We’ve got no idea if all the slots are filled up but since one of them starts this Saturday you best get on this if your Cancun plans have fallen through:

• March 6 – 12 — Deloitte and United Way will co-host 50 students from approximately 30 colleges and universities along with 20 Deloitte professionals during a week of hands-on and skills-based volunteerism in Atlanta, Georgia. Students will work to enhance childcare centers, refurbish playgrounds for low-income youth, guide students in college exploration and promote literacy in children.

• March 14 – 18 — Deloitte and Teach For America will co-host 25 students from six colleges and universities along with 20 professionals from Deloitte and Teach For America for a week of education-centered volunteerism in Baton Rouge, Louisiana. Volunteers will spend time working with schools and local students who face the challenges of educational inequity through projects that include improving campuses, developing classroom lessons and helping with class preparation work.

You better get on this ASAP if you’re interested since only 75 students and 40 professionals get to participate. The problem for current Deloittians is most of you are eyeballs deep in busy season anyway so this isn’t an option. So does this mean that non-busy season types like Jim Quigely, Barry Salberg, and Punit Renjen will be in attendance? And if so will they be sporting new board shorts for the pool time they are able to squeeze in?

Deloitte Offers Students Chance to Give Back, Explore Careers on Spring Break [Press Release]

Are the Big 4 Desperate for Audit Work?

Adrienne Gonzalez
March 3, 2010

In the latest predatory tactic from our friends at the Big 87654, we see that the recession may not be treating them so badly. Sure, non-profit busywork isn’t exactly a good time to be had by all but it pays the bills and for the Big 4, there is no such thing as bottom of the barrel.

Take what you can get, right?

Crain’s:

The financial crisis blew up many big-name clients, leaving audit firms with excess capacity. Bear Stearns Cos., Merrill Lynch & Co., Washington Mutual Inc. and Fannie Mae disappeared from Deloitte LLP. Ernst & Young saw Lehman Bros. Holdings Inc. implode, while KPMG lost Countrywide Financial Corp. and PricewaterhouseCoopers lost Freddie Mac.

Gary Boomer, a Kansas-based accounting industry consultant, says Big Four firms sometimes are bidding less than $100 an hour for non-profit and public-sector work, down from $175 to $250 for junior auditors. “What they’re doing is buying some work to keep the staff busy,” he says.

That’s hilarious, shouldn’t we stop and think about why they allowed “the financial crisis” (you mean the unstable positions of those financial firms lost in the bloody battle?) to blow up so many of their big-name clients before we let them scavenge the scrapings for a tasty morsel of audit work?

I guess it works, it’s not like you’ve got guys in the cathedral on December 31st counting saint candles.

It could be worse. Here are some really nasty audits that the Big 4 could be doing in lieu of cheap non-profit and public sector work:

Joe Stack – Think about it, KPMG, you have some awfully tall buildings, be grateful.

Blackwater expenses – They really deserve their own audit team. It’ll keep those juniors busy, ifyaknowwhatImean.

C Street – Bonus side work helping Mark Sanford convert his dollars into Argentine pesos.

Whore yourselves out however you have to, guys, even if it means a door-to-door campaign for whatever audit work you can find.

(UPDATE) Accounting News Roundup: Rangel Says He’s Not Quitting as Ways & Means Chair; IRS Is Sitting on $1.3 Billion in Unclaimed Refunds; SEC Adding Muscle in New York | 03.03.10

Caleb Newquist
March 3, 2010

• Rangel Loses Support in House [WSJ]
You can ignore what’s written below, except the part about rent-controlled apartments.

Charlie Rangel will ~~not~~ be quitting (temporarily sayeth Charlie Rangel) as the Chairman of the House Ways & Means Committee. If you (read: Republicans) want him out, you’ll have to vote him out. Bad news for Chuck is that the Republicans in the House and several of his fellow Democrats are poised to do just that, “As many as 30 House Democrats could join 178 House Republicans in voting to oust Mr. Rangel as head of the Ways and Means Committee…a substantially higher number than in previous votes on his removal.”

Never mess with people when it comes to rent-controlled apartments. They’ll turn on you like Judas.

In the meeting, Mr. Rangel refused to quit as chairman of the Ways and Means Committee and instead said he’d think overnight about the matter before deciding whether to step down or face an uncertain vote.

After the one-hour meeting broke, Mr. Rangel told reporters he would stay on.

“You bet your life,” he said. Pressed further, Mr. Rangel, raising his voice, said emphatically: “Yes, and I don’t lie to the press.”

There you have it. You want Rangs out? It’ll be over his dead body. Since he’s 79, it might just come to that.

• Taxpayers Have $1.3 Billion in Unclaimed Refunds [TaxProf Blog]
That’s just for 2006. California leads the charge with over $150 million, followed by Texas with $114 million, and Florida with $110 million. 1.4 million tax-hating Americans have until April 15th of this year to claim and then the money goes straight to Goldman Sachs.

• SEC to beef up its NYC office in 2010 [Reuters]
Here’s a possible gig for those of you that are still looking for work. The not-so-new but constantly improving (?!?) SEC is looking to hire a few good men and women for its New York office. Having got the scratch to put a few more hands on deck, the Commission is looking for 18 people for its enforcement team and 15 for its examination staff. There’s no indication that this will solve the SEC’s “idiots” problem but maybe you can at least land a job.

Quote of the Day

Quote of the Day: Big 4 Lowball | 03.02.10

Caleb Newquist
March 3, 2010

“What they’re doing is buying some work to keep the staff busy.”

~ Gary Boomer, on the Big 4 low bidding smaller clients.

Thankfully, Most Americans Show Hatred for the IRS in Less Violent, More Passive-Aggressive Ways

Caleb Newquist
March 3, 2010

Okay, so the past few weeks we’ve seen some psychotic behavior as it pertains to IRS. And yesterday, someone’s llelo (yes, it’s Utah, but that’s the best we’ve got right now) was mistaken for Anthrax and it caused the FBI and Hazmat to storm the building and leave with bodies wrapped up like mummies. If you’re getting worried that people might be freaking out, you’ve got some solid evidence in your corner.

The good news is that not everyone who hates the IRS with every fiber of their being is so cold that they’ll fly a plane into a building, shoot a gun at their spouse or destroy the very home they live in.

Michelle Lowry knows first-hand how much people hate the Internal Revenue Service.

The 37-year-old Leander woman, who processes forms for the IRS in Austin, confronts that venom regularly. People slip razor blades and pushpins into the same envelopes as their W-2 forms. They send nasty notes with their crumpled documents. Last year during the height of the Tea Party movement, hundreds of taxpayers included — what else? — tea bags with their returns.

See? It is possible to show hatred for the IRS without trying to killing someone or destroying your own property. Let’s try thinking things through before we start going completely batshit insane, shall we?

Passive-aggressive protest seems like a more modern way of showing contempt for the government anyway.

Threats, contempt come with job for IRS workers [Austin American-Statesman]

More IRS Violence: Joseph Stack Was Not the First Violent Tax Protester…and He Won’t Be the Last

Audit

Crowe Horwath Was the Big Audit Client Winner in 2009; E&Y, Deloitte Big Losers

Caleb Newquist
March 3, 2010

We might be a little late to the party on this but it just recently came across our desk and since trying to get a post up today is akin to turning water into wine, we’re running with it. And, frankly, if a large portion of you regularly read the “Public Accounting Report” we’ll be blown (BLOWN!) away.

The determination of the ranking isn’t entirely clear to us so we’ll just go for some superficial analysis on Crowe Horwath (#1 on the list) and the Big 4:

• Crowe Horwath #1 – Net gain of 24 clients; net gain in audited revenue of approximately $4 billion; net gain in assets audited of $18.4 billion; net revenue to the firm of $11 million.

• PwC #2 – Net loss of 8 clients; net gain in audited revenue of $34.9 billion; net gain in assets audited of $2.68 billion; net revenue to the firm of $8.4 million.

• KPMG #5 – Net loss of 1 client; net gain in audited revenue of over $12.9 billion; net loss in assets audited of $61.4 billion; net loss in revenue to the firm of $19.5 million.

• Ernst & Young #9 – Net loss of 30 clients; net gain in audited revenue of $5.3 billion; net loss in assets audited of $53.8 billion; net loss in revenue to the firm of $36.7 million.

• Deloitte #10 – Net loss of 7 clients; net loss in audited revenue of over $90.5 billion; net loss in assets audited of $718 billion; net loss in revenue to the firm of $74.7 million.

Crowe Horwath’s net gain of 24 clients is easily the highest of the firms presented and they’re the only firm that has increases in all the categories presented. Kinda makes you wonder why they had such a steady stream of layoffs in 2009. We’re open to suggestions and wild-ass theories on this topic.

On the losing end, Deloitte’s loss of huge clients due to the financial apocalypse has been noted by our contributor Francine McKenna and is noted by the PAR:

The firm landed the most wins of any of the Big Four firms for 2009, 46, garnering 3.5% of the overall SEC audit wins for the year. Overall, the Big Four won 7.5% of the auditor changes reported during the first three months of 2005. What relegated the firm to last place in the standings was two huge loses: UAL, to E&Y, and Merril Lynch’s acquisition by Bank of America.

All that added up to nearly $75 million in lost audit fee revenue for Deloitte. In terms of the number clients lost, E&Y managed to cruise to that title with net loss of 30 clients:

E&Y captured some sizable wins for the year, notably UAL/Chicago (Revenue: $20.19 billion) from Deloitte and Apple/Cupertino, Calif. (Revenue $32.48 billion) from KPMG. But its gains couldn’t offset losses for the year of Tyson, Sovereign Bancorp and Nalco Holding, to name a few notable losses.

The end result of this client musical chairs doesn’t really add up to much in terms of revenue for any of the firms. Even the $75 million lost by Deloitte is a drop in the bucket compared to their fiscal year ’09 revenue of $26.1 billion.

Peruse as you numbers see fit and feel free to wave the flag.

Video

Just So You’re Aware: An Accountant Tried Out for “So You Think You Can Dance”

Caleb Newquist
March 3, 2010

Sure, it’s in Australia but since there’s such a push for an international accounting community it seems appropriate. Our assessment, after the jump:

So he was definitely dressed better than most accountants we’ve come across. Even after he tore the sleeves off. Plus the jump-splits, you have to admit, were impressive. Falling down the steps was an especially nice touch too. But who carries a briefcase?

[h/t Accountant jokes]

Thinking Career Change? Big 4 Probably Isn’t for You

Daniel Braddock
March 3, 2010

A reader posed a question to one of Caleb’s posts last week with regards to, “how to get into one of the big four accounting firms as an entry-level auditor when you are a laid off baby boomer with many other experiences?”

My short answer — in so many polite words — is why would anyone want to do that? Even as a recently laid off baby boomer, I can only hope that your career, up until its unexpected termination, was fulfilling. Contacts, networks, referrals, and references; all of these resources should be tapped out before considering a complete career change.

On a more basic level of necessity, I doubt that an entry-level career (well below the average Big 4 salaries earlier discussed) starting between $48,000 and $60,000 is ideal for a baby boomer. This is before the return on investment is even discussed. If I was a recruiter and had to choose between hiring a green recent graduate with minimal zero family obligations versus a baby boomer, parent of three, coming off of a recent firing, the answer is simple. The young buck will complain less, cost less in insurance terms, and has a recent education that can be molded to fit the firm’s methodology.

The typical public accounting career path is set: graduate from school, start career with a Big 4, take your punches and roll up the ranks. Those still standing in 10-12 years make partner. Burnt out souls need not apply; there’s always the private sector.

There are a few exceptions to this rule of thumb. The experienced hiring departments of the Big 4 are consistently recruiting specialized talent from the private sector. Ten years ago this centered heavily around the IT departments, as firm security practices grew exponentially (gotta love those SAS 70’s). Tax specialists are always in need. Many of the firms poach experience from government work, which is about as plug-and-play of a situation as you could hope for.

More on the volatility side of things are the firms’ advisory practices. Through 2005-2008, experienced hiring for the forensic, corporate finance and M&A practices tried desperately to keep up with growth opportunities. Turn the page to 2009 and where do you think the axe fell the most? No question it was the advisory lines. But even now as the markets shed thousands of jobs, a supply of raw talent appeared on the horizon for the Big 4 to gobble up. It can oftentimes be a rollercoaster of both potential and risk, but generally the best opportunities for experienced employment can be found here.

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