Going Concern

Deloitte

Deloitte, All Out of Cost-Saving Ideas, Launches Project JARED

Caleb Newquist
January 20, 2010

When we first received the tip about Project JARED we thought that Big D had struck a deal with Subway in order to help you lose those extra pounds you’ve been carrying around.
Unfortunately, “Project: Jointly Address Reducing Expenses at Deloitte” won’t be getting you sandies on the cheap; rather it’s a solicitiation of your ideas for saving the Firm money. Apparently Deloitte is plumb out and needs some help

This is your chance to help make Deloitte fitter and stronger — by contributing your ideas to Project JARED.
Project JARED was launched in the U.S. earlier this year to enable our organization to ‘shape up’ by building organizational muscle ― devoting maximum resources to our people and market opportunities. Hence, Project JARED: Jointly Address Reducing Expenses at Deloitte.
“Jointly is a key word here,” said Tony Forcum, Deloitte Consulting LLP, who leads Project JARED.
“More than 600 partners, principals and directors have already been involved in detailed discussions and input sessions, generating over 1600 cost-reduction ideas. We are certain that opening up the dialogue to all of our people will generate additional insights. We need transformational ideas if we are to reach our goal of permanently eliminating $750 million of costs by FY12. We have made a good start toward our goal. The team has validated more than $120 million in sustainable cost savings from the changes made in FY09,” he said.

Changes have produced savings and improvements in all kinds of ways ― for example, by using our telesuite facilities to reduce business travel, thus not only saving money but also reducing the time everyone spends away from home: a win-win for all.
The Project JARED team is looking for suggestions from those who know the organization best — its people. If you have often thought: “We could save a lot if only we…” now is the time to share your idea. It could be a day-to-day activity, a fresh approach to leveraging technology, an enhancement to a process, a way to change behavior that saves money―all cost-saving suggestions are welcomed.
Visit the Project JARED site to submit your ideas, learn more about the project and ask questions.

This latest plan struck at least one person as dubious and they asked the question on probably everyone’s mind:

Q: Is this just a fancy way of saying we’re going to be losing more jobs?
A: It is impossible to predict the future, but that is not the focus of the project. The organization is casting a wide net for cost savings, looking at tactical savings (printing on both sides of the paper), operational savings (streamlining the process by which work gets done from inception to completion) and transformational savings (transforming some of the ways we do business). All of the decisions we make about Project JARED will be consistent with our core values, brand and strategy.

So “not the focus of the project” should put your concerns to rest, no? And it looks like your bright idea of printing on both sides of the paper is already taken, so don’t bother submitting that one.
Let’s put our heads together gang and figure out how we can save Deloitte money. Should Barry Salzberg stop getting haircuts? Pull the plug on Deloitte University? Give up on training male employees to better understand their female colleagues?
Nothing is too crazy people. Get on this.

Interns – Where Are They Now That They Could Be Useful?

Adrienne Gonzalez
January 20, 2010

Editor’s note: This is the latest post from Daniel Braddock, your friendly Human Resources Professional. He could very well be considered a hypothetical love child of Suze Orman and Toby Flenderson. Following his varsity jacket wearing college days, he entered the consumer markets as an auditor for a Big 4 firm in New York City. He spent three brisk years as an auditor before taking the reins of stirring the HR kool-aid. He currently resides in Manhattan. Daily routines include coffee breakfasts and scotch dinners. You can follow him on Twitter @DWBraddock.
You might agree with the sentiment that now would be a fantastic time to have an extra set of hands ticking and tying through the night. Where are those lovable interns when you could actually put them to good use?
I’ll tell you where they are. They’re sitting in class or – depending when this is published – already at the bar for Tuesday’s dollar beer night. They’re getting their McStudy on, prepping for what promises to be one of the best summer internships in the job market today.
As Francine McKenna mentioned, the Big 4’s intern programs are regarded as some of the strongest. Why? It’s certainly not because the programs offer rigorous, reality-driven experiences. The bulk of interns experience your firms during the summer months; nothing like busy season. Many of you were interns yourselves, spending 8-12 weeks basking in the attractive glow of the 10-year partner track and abundance of work/life initiatives.

The fundamental purpose of an internship was – for a long time – a simple machine: offer students the ability to “test” a career in public accounting while providing H.R. with a fulltime hire “pre-screening” process. Programs have elaborated to the points of gross extreme (more about this on Thursday), but the general principle remains.
This is why I disagree with Francine’s comment that, “hiring more interns instead has big pitfalls, for both the employee and the firm.” Personally, I’d rather my firm hire its entire new fulltime class from the previous intern pool, and why the hell not? As light and fluffy as the experience is, the internship program can weed out the few incompetents that snuck through partner interviews. Of course, that’s assuming management gives half a damn and spends more than 1.7 seconds completing the H.R. performance reviews for each intern.
The root of the problem is that the “best” internship programs have lost touch with the core values of the past. Ten years ago interns were local students working part-time in order to save money for a car payment or next semester’s books. The experience was elementary but worthy nonetheless. Now, the current state of the Big 4’s programs are a product of keeping up with the Joneses. Summer months set the competitive stage for training sessions, mentorships, ball games and beers. Stir in a high paying salary (with the possibility for overtime!) and H.R. wonders where the Millennial Generation’s sense of entitlement originates. The Kool-aid is spiked with the fruits of privilege.
Don’t expect things to change anytime soon.

Uncategorized

(UPDATE 2) We Knew Accounting Firms Were Helping Haiti

Caleb Newquist
January 20, 2010

We just had to ask. In response to our post from this morning we’ve received several emails about what firms have done so far in the response to the devastation that was caused by the earthquake in Haiti:
• Deloitte – The firm contributed $100,000 to the Red Cross and Deloitte professionals are encouraged to donate to either the Red Cross/International Response Fund (immediate disaster assistance) or to the United Way Worldwide Disaster Fund are for long-term relief efforts. Donations will be earmarked for Earthquake Recovery.
• Moss Adams – The Firm is matching 100% of employee contributions up to $100,000. As of today, partner and employee contributions amounted to $30,000 and the firm is matching these contributions with $30,000 donations to both the Red Cross and World Vision.
• Ernst & Young – The Firm has created the “Ernst & Young Haiti Earthquake Relief Fund” and donated to $100,000 to get things started. All the funds donated by the firm and its professionals will go directly to Save the Children, Doctors without Borders, and Partners in Health.
• BDO – Jeremy Newman posted today on his blog about the firm’s efforts, including the office in The British Virgin Islands.
• Grant Thornton – The firm is matching employee contributions up to $50,000. The funds will be donated to the Red Cross and The Salvation Army.
• McKonly & Asbury – Scott Heintzelman — The Exuberant Accountant — along with his fellow partners and employees are working with Hope International to raise funds for the relief efforts. A spokesperson for the firm told GC that the firm is expecting to raise several thousands dollars.
• Crowe Horwath – Matching employee contributions up to $50,000. All funds are going to the Red Cross and UNICEF.
Keep us updated with your firm’s efforts and we’ll continue to post them.

Career Center

Job of the Day: Real Estate Fund Controller Needed with Knowledge of GAAP and IFRS

Caleb Newquist
January 20, 2010

Here’s a controller position that has a good salary that beats the average controller salary from our earlier post on salaries for jobs that you may want.
Check out the details for an open end real estate fund controller available in New York City, after the jump.

Title: Controller
Compensation: $150,000 – $185,000
Location: New York, NY
Minimum experience: 8 years
Description/Responsibilities: Define client services for open end investment funds, liaison with client financial advisors and build a staff. Manage relationships, operations and reporting re: US GAAP and IFRS.
Requirements: Requirement is for CPA/ Controller with 8/10 year yrs in open ended real estate investment vehicles utilizing CORE or CORE+ strategy. Good GAAP and client facing experience. Working knowledge of MRI/YARDI and Investran, PEFS real estate and fund administration is a plus. Position can be based in New York, Luxembourg or London.
See the entire description over at the GC Career Center and visit the main page for all your job search needs.

RSM McGladrey Does the PGA a Solid, Sponsors Golf Tournament

Caleb Newquist
January 20, 2010

RSM McGladrey’s C.E. Andrews was on CNBC today to plug the The McGladrey Classic, the new PGA Tour event that has NOTHING TO DO WITH TIGER WOODS.
C to the E to the A also isn’t too worried whether or not his firm got a deal sponsoring the tournament at the rumored $3 – $3.5 million since the wheels were already in motion before the “Tiger event” (read: everyone on Earth knows that he’ll screw anything). He’s just stoked that the firm has their name on a tournament (although it’s not so obv from his demeanor).
As for PGA commish Tim Finchem, he hasn’t talked to him and he says he won’t until T Dubs is ready. According to the commish, they’ll prepare appropriately at that time which will probably involve having local hookers on site at the events.
Basically the unspoken element here is how grateful the PGA is to have RSM do them a favor in their time of need.

Uncategorized

Salaries for Accounting and Finance Jobs You May Want

Caleb Newquist
January 19, 2010

The good folks at Accounting Principals (they’re your pals) and Parker & Lynch put out their salary guide for 2010 last week and we managed to pour through the thing as superficially as possible.
With that in mind we present to you the top five average base salaries at various levels as presented by the guide:
Accountants and Financial Personnel
• Senior Budget Analyst – $75,200
• Tax Accountant – $74,000
• Senior Financial Analyst – $72,900
• Senior Treasury Analyst – $72,400
• Senior Internal Auditor – $72,300
Supervisor
• Financial Reporting Supervisor – $80,400
• Tax Supervisor – $77,800
• Budgeting Supervisor – $77,300
• Auditing Supervisor – $73,600
• Cost Accounting Supervisor – $71,900

Mid-Level Managers
• Audit Manager – $109,300
• Tax Manager – $105,400
• Sarbanes Oxley Manager – $99,800
• Financial Analysis Manager – $99,500
• Financial Reporting Manager – $95,700
Executive and Senior Managers
• CFO – $329,600
• Finance Director – $210,600
• Treasurer – $183,900
• Top Audit Executive – $179,200
• Controller – $175,500
It’s pretty clear that the first big jump is at the manager level and then we see another even bigger jump at the executive/senior manager level. The guide doesn’t appear to include partner salary data which as it has been discussed, varies widely.
For anyone that’s looking for a job based primarily on salary (you know who you are), these positions may be the ones to look at first.
Abrashoff-Salary-Guide-2010.pdf

KPMG

KPMG Advisory Has Another Potentially Awkward Meeting, Sans Dog

Caleb Newquist
January 19, 2010

If you’ve been hanging around these parts long, you’ll remember back in the fall when Klynveldians were sitting down for their compensation discussions which gave birth to one of our favorite mascots. All professionals in the Southeast region of the advisory practice witnessed an awkward moment when the then partner-in-charge of advisory phoned in, along with his dog, to break the news to the troops that they weren’t getting squat for raises.
Well today, there’s another call down in the Southeast — the “SE Advisory Market Development Staff Update Call” to be precise — and apparently there’s more bad news. It seems that the SE advisory practice (the largest in the firm, according to one source) is a bit behind on its revenue targets for the first three months of the new fiscal year and January isn’t shaping up so well either. The actual revenues are trailing the planned targets by approximately 15%, according to slides from the presentation obtained by GC.

Sources have indicated that while there is significant pipeline revenues, as of January 11th, only ten percent have either verbally committed to an engagement or are currently being negotiated. More than one-third of the pipeline is classified as being in the “identification” stage which is largest group. Now perhaps that is a normal ratio but another slide indicated that the number of client wins are on pace to be down considerably (~50%) for the month of January as compared to the prior three months.
One of our sources indicated to us that a major problem is that “identification” of a potential client was enough to have it included in the pipeline. In other words, if your Pomeranian sniffs a Boston Terrier’s ass at the dog run and you talk shop with the owner of said Boston T, that person is more or less in the pipeline. The conversion of the BT apparently is not crucial and even if the Boston Terrier is converted to realized revenue, it was a far smaller percentage than initially estimated.
The problem, as it appears to us, is that business in the advisory practice in the Southeast could be drying up (or maybe just getting more competitive) and that conversion of potential business is slipping. It’s far too early in the fiscal year to speculate — but by all means go right ahead — about what this all will mean and if business picks up, then it will be moot. But after the shake-ups that went down in that part of the country, the pressure is most certainly on.
If you were on the call today or have more insight, discuss and get in touch.

Uncategorized

Why Haven’t We Heard About Accounting Firms Helping Out Haiti?

Caleb Newquist
January 19, 2010

Because we’ve been looking for some PR and haven’t seen much.
We’ve got no doubt that accounting firms large and small are doing their part to help out the relief efforts there but we’re surprised about the lack of PR. Other than a brief memo (PDF below) from the AICPA that we saw on Twitter this morning, we haven’t seen much of anything.
Our sister site Above the Law has covered the many law firms that have donated to the efforts in Haiti but we haven’t seen anything on accounting firm donations efforts. Even, everyone’s favorite ward of the state, Citi, is helping out in the big way.
Maybe it’s being kept internal but it seems like an opportunity to demonstrate what firms are doing to help.
If your firm has made efforts, or if you’re a PR professional for your firm and you have a press release describing your firm’s efforts let us know and we’ll spread the good word.
AICPA.pdf

Preliminary Analytics

Preliminary Analytics | 01.19.10

Caleb Newquist
January 19, 2010

• Tyco to Buy Brink’s Home Security for $2 Billion – “Tyco International Ltd. announced plans to buy Brink’s Home Security Holdings Inc., also known as Broadview Security, for $2 billion, the first major acquisition for Tyco in eight years since the company was rocked by scandal and split into several pieces.” [WSJ]
• Sitting Is a Silent Killer, Swedish Medics Warn Couch Potatoes – Desk jockeys too. [Bloomberg]
• Who Would Miss the Big Four? – “Hardly anyone, says Jim Peterson.” [CPA Trendlines]
• Special tax breaks proposed for Haitian earthquake relief donations – “Under a bipartisan House bill, if you contributed money to nonprofits providing relief to the stricken island nation, you would be able to deduct those donations on your 2009 tax return.” [Don’t Mess With Taxes]
• More Men Marrying Wealthier Wives – This doesn’t mean that you get to stay home glued to the Playstation. [NYT]
• Citigroup Loses $7.6 Billion on Costs to Repay Bailout Funds – The streak of three “profitable” quarters ends. [Bloomberg]

Review Comments

Review Comments | 01.18.10

Caleb Newquist
January 19, 2010

• Cadbury and Kraft turn sweet on deal – Kraft finally put up a number that wasn’t an insult. [FT]
• Senator Wants Explanation on AIG Severance Deal – Chuck Grassley would like Ken Feinberg to explain why the AIG general counsel got a severance package. Yes, he’s up for re-election. [WSJ]
• Market Concentration of the Big Four Audit Firms: The Feasibility of a Suggested Trade — Divestiture for Liability Limitations – “[I]s there a credible case to incentivize their exchange of market dominance for liability limitations?” [Re:Balance]
• What a Phishing Scam E-mail Looks Like – An exclamation point in an email from the IRS should be your first clue. [Tax Update Blog]

A Quick Word About the Wyclef Jean Foundation Controversy

Caleb Newquist
January 19, 2010

There has been lots of donations made to several organizations since last week’s earthquake in Haiti and Wyclef Jean’s Foundation, Yele Haiti was one of the most prevalent charities raising funds.
As you may or may not be aware, there has been a good deal of coverage of the foundation’s financial problems and this has caused many to think twice about which charity they donate to.
After all the criticism, Gawker now has video of Wyclef Jean admitting that his charity, Yele Haiti, has made “mistakes”. These mistakes range from late filing of its tax returns to the foundation paying expenses on behalf of Jean’s production company (go to The Smoking Gun for more details including the 2006 Form 990).
From a tax standpoint, if you donate and you itemize, you can take the deduction (AGI limits apply and you best keep those receipts), however, as some have pointed out, choose wisely. It is natural to want to donate in times of crisis and if you want that money to go to its best use, then be do some research and make sure you know how the money will be spent.
Wyclef Jean Charity’s Funny Money [The Smoking Gun]

Uncategorized

More Grant Thornton Details: Declining Revenues, Raises in 2010, and Stephen Chipman Will Be Blogging

Caleb Newquist
January 19, 2010

We stumbled across the playback of the all-personnel call that went out to Grant Thornton professionals last Friday and we decided to give it a listen. It was about as snoozerific as we expected but we did come away with some additional information to share with you
Stephen Chipman, GT’s new CEO in the States spent about 40 minutes explaining the good the bad and the ugly at G to the T and here are some highlights:

• 81% of those survey and Grant Thornton are proud to work there. High? Low? Completely made up? Does this consider the Sue Sachdeva effect?

• Chip is going to be focusing on various new forms of communication including his own blog. This makes him the second CEO to do so, following Newman over at BDO. We hope, for your sake, that Chip won’t moderate the comments. We insist that you notify us of this as soon as it goes live.

• The new CEO got pretty somber when he described the prospects for GT’s revenue in FY 2010, stating revenues for core services were declining 11% year over year. Global Six…slipping…away.

• Because of this decline, it was decided that layoffs at the senior manager and partner level would occur (many have been notified already) along with those in the “internal client services function”.

• Despite the bad news, Steve-o did his best Bob Moritz, and made it clear: “We will be giving pay raises this summer.” He did qualify that this would be based on 1) the performance of the firm and 2) individual performance.

So that’s the long/short. Like we said, dude went on for 40 minutes and we didn’t have the thing transcribed to give it to you verbatim. If you happened to be one of the unfortunate senior managers, partners or support professionals that aren’t making the “next stage of the journey” get in touch with us about your experience.

For those that remain on team GT, discuss the big guy’s big promise of raises, the blog, revenue issues, etc.

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