A former KPMG partner has pleaded guilty today to conspiracy charges related to tax shelter scheme.
According to the WSJ, “[Robert] Pfaff is currently serving a 97-month prison sentence after he and two others were convicted on tax evasion charges last year in a case once billed as the largest tax-shelter fraud case in U.S. history. In that case, prosecutors had alleged that Pfaff and another former KPMG employee left KPMG in 1997 and formed an investment adviser known as Presidio Advisory Services, which was little more than a ‘tax shelter mill’.”
Doesn’t ‘tax shelter mill’ sound like a wonderful place of capitalistic creativity and entrepreneurship where things just magically happen and you don’t why or how? Sort of like a financial Charlie and the Chocolate Factory? The kind of place where you wish you worked?
Ex-KPMG Tax Partner Pleads Guilty In Tax-Shelter Case [WSJ]
Your Hire Date is Delayed, Now What?
Inspired by recent events which I shall not get into here because of CPA Wrangler/client privilege, I figured now might be the time to do a quick “how to survive if you thought you were starting with the Big 87654 but suddenly won’t be until 3 quarters from now” refresher. Here you thought you got a sweet gig and now it’s all about making it until your delayed start date.
First and foremost, you’ve got your parents. They might have even put you through school. Your Dad may have called me at the CPA Factory asking if he could put your CPA Review course on his credit card (awww what a nice guy). Maybe they aren’t totally disappointed in you yet and haven’t lost their savings to Alan Greenspan’s bubble fixation. Whatever the situation, you should know by now that this is the first place to tap for extra cash, not your couch.
More, after the jump
Secondly, maybe the Universe is trying to tell you something. Is this really what you want to do with your life? Public accounting? Really? No one’s saying you’ve got to have a spiritual awakening or anything but maybe this is the time to evaluate the direction your life is trying to take. If nothing else, take it as a sign that you could use a Sabbatical.
Let’s not forget that you should be employable somewhere else. So instead of sitting around on the Xbox 360 eating ramen until you show up all pretty and polished for your first day at the Big 87654, go shop your shiny ass to other firms who might have the cash to cover your paycheck. If you’re looking for an easy way to meet the experience requirement and get your CPA and are lucky enough to have a trust fund, you’re totally fine sitting around pwning 12 year olds at Halo. But if you actually want to be an accountant for the rest of your life, go out there and sell yourself to a smaller firm who might appreciate your skills, not leave you waiting like a bad Craigslist blind date.
The last thing to keep in mind here is that sometimes it really is not you but me. Firms are scrambling to keep the quality staff they have and replenish the stock that are moving out of public accounting; take advantage of this. As we pointed out here on Going Concern already, don’t trip on the recruiters, they might be out of a job in a few months. It’s a bloodbath out there so slap on your gloves and try not to get any on your nice blue tie.
And if things get really bad, you can always froth lattes at the local coffee shop for the next few months. Give me a discount on my quad black eyes and I’ll tell you what *I feel* might be on the FAR exam next window *cough*
Hang in there, kids!
(UPDATE 4) KPMG Layoffs Follow-up
There are several cities where we can confirm layoffs but total numbers are hard to come by and KPMG is not returning our calls/emails at this time. Here are cities that we definitely know got hit:
• Chicago – At least five in Int’l Tax. At least one in financial services tax.
• Denver – Transaction Services
• Kansas City – Six to eight in Tax
• Houston – Transaction Services
• San Fran – Five in Fed Tax
• LA and OC – Several comments report ten to twelve in tax for LA, five for OC
• DC/Tyson’s Corner/McLean – Between five and eight total in tax and advisory.
• Silicon Valley – Thirteen total. Five to Seven Mostly in Tax, possibly some in EVS and one in Transaction Services.
• Seattle and Portland – Two in Tax for each
• Salt Lake City – Three in Tax
• Detroit – Three to five in Tax
• Jacksonville, FL – Two in Tax
• New York – Three in the transfer pricing specialty group in the tax practice. Three in the real estate practice. According to our source, these were performance performance related.
• Boston – Two in Fed Tax and one in M&A
• Nashville – Two in Tax
• Tampa – Two in Tax, one manager and one SA
We haven’t been able to confirm much out of the New York office, although it sounds as though Transaction Services has had some cuts. If you’ve got new details on any city, let us know.
UPDATE: See updates above. Altogether it appears to be over thirty-five in the west alone. Continue sending us updates.
UPDATE, Thursday, 11:54 am: Information is still crawling in. We heard that the number of nationwide layoffs for Advisory was 50, including 20 in the NY/Boston offices but we’re still waiting on more information. Continue to send tips in and make sure you note which office you’re in. Oh, and apparently the Dallas office needs SA’s in audit.
UPDATE, Friday, 12:30: Still a few tips coming (see updates above) in but it seems the worst (hopefully) is over.
UPDATE, Monday 3:04 pm: Just a couple more updates above for Nashville and Tampa.
Thanks to This Week’s Advertisers
A quick word of thanks to this week’s advertisers on Going Concern:
• De Beers
• Soul Calibur 4 PSP
If you’re interested in advertising on Going Concern, email us at advertising@breakingmedia.com. Thanks!
Accounting Professors Aren’t Waiting for Bureaucrats to Get Their Act Together
Even though the convergence of IFRS and U.S. GAAP seems like a DeLorean ride away accounting professors polled believe that it should be included in the curriculum, according to Web CPA:
More, after the jump
The survey, by KPMG and the American Accounting Association, found that half of the professors who responded to the survey said they thought a low sense of urgency exists among U.S. regulators to adopt IFRS by a “date certain,” while only 16 percent believe regulators have a high sense of urgency.
Regardless of academics’ pessimism about the SEC getting their shit together and making this marriage of accounting rules happen, the slow integration into the American curriculum is still occurring:
Despite this challenge, 70 percent said they have taken significant steps to incorporate IFRS into the curriculum. In addition, 83 percent believe IFRS needs to be incorporated into their curricula by 2011…Given the dynamics of the current regulatory environment, 79 percent of faculty believe that U.S. GAAP should continue to be taught over the next three to five years, while progressively incorporating more IFRS concepts via a compare-and-contrast approach as the conversion date approaches.
A majority of the respondents to the survey also expect IFRS to be included in the CPA Exam by 2012/2013 and in intermediate accounting textbooks by 2011/2012.
For those of you still cracking the books, discuss if your profs have brought this up and what kind of priority they’re putting on IFRS. We’re not holding our breath for anything meaningful from TPTB.
Accounting Professors Urge IFRS Education [Web CPA]
E&Y: This Stuff Is So Important That We Can’t Let You Be Distracted By Regular Work During the Week
Late November is typically a time of year when most of you can coast a little bit. Oh sure, some of you certifiable types are still working like your miserable lives depend on it (and probably not charging the time) so we’ll ignore you for this particular post.
We learned yesterday that the New York and Philadelphia offices of E&Y are apparently so strapped for time during the eleventh month that the annual accounting & auditing update has been scheduled for the 21st which is on a…wait for it…Saturday. That’s EVERYONE, staff through partners.
Now maybe there’s a perfectly good explanation for this odd scheduling. Perhaps the rulers of the Ernstiverse aren’t down with the whole day of rest thing. Or they figure since you’re getting two days off the following week, your ass is lucky that you’re not working Sunday too. Whatever the case may be, E&Y seems to be good at making promises so don’t make plans.
Preliminary Analytics | 09.23.09
• Ernst & Young settles Akai case – No deets disclosed. [FT]
• Chase and Bank of America Revise Fee Policies – Under duress of course. [NYT]
• Moody’s accused of issuing inflated ratings: report – Ratings were bupkis, why wouldn’t their numbers be? [Reuters]
• J&J CFO: Biggest Nightmare Is Public Health Option – It’s not a nightmare for everyone. [CFO]
• Former eBay Chief Running for Governor of California – Good luck. Seriously, you’ll need it. [DealBook]
Review Comments | 09.22.09
• SEC warns swaps may evade White House reform – It’s not like they were totally responsible for the crisis. [Reuters]
• Minnesota Ends Tax Reciprocity with Wisconsin – WI can’t pay MN fast enough so IT’S OVER. [Web CPA]
• FDIC May Ask Banks to Prepay Fees – You may have noticed there’s a bit of a problem. So SheBair is probably going to do this but thanks for asking. [WSJ]
• Freddie Names Kari as CFO – You didn’t want that job anyway. [WSJ]
• Wall Street Firms Fined Over Bad IPO Information – $420k. Meh. [AP via NYT]
NASBA Still Moseying Around Getting Your CPA Exam Scores Released
A little follow up from last week’s post on NASBA toying with you. Shockingly, scores are either just coming out or haven’t been released.
Most people we’ve checked with are still waiting and it’s been 2+ months. By now for most of you waiting this long for your scores have probably had to start taking Xanax but we’re sure they’ll be out any day know, so try to relax.
If you’ve gotten your score(s) and passed, feel free to gloat in the comments, or if you’re still waiting, discuss how you’re coping.
Are Inventory Counts the Bane of Your Existence?
That’s probably a stretch but we have a tendency to over-dramatize some things, so hang with us.
Since we’re coming up on the end of Q3 next week and many of you are of the audit cloth, we’ll start a thread on inventory counts and how they have the uncanny ability to f*ck with your universe, particularly come December.
One source dropped us a response they received after requesting time off in December:
After the jump
At this time we are not granting any time off for associates during Christmas or New Years weeks – conditional or unconditional. Over the next few months as we receive inventory requests for the holidays, we will make sure that these requests are adequately covered, then we will be able to review our holiday policy and let you all know if time off will be granted and how.
So hold off on making plans because you might need to go to a chicken farm in the middle of Missouri on New Year’s Day. Get it?
Discuss in the comments how well/poorly your office handles the inventory sitch and feel free to give the new hires an idea of what they’re in for. We heard a story once that involved a headless chicken. Run with it.
More Foam Fingers for Everyone, Except You BDO
Not surprisingly, the Big 4 find themselves on another best of list, this time the best for Working Mother 100 Best Companies for 2009. RSM McGladrey and Grant Thornton also made the list so it seems legit.
All these firms also made the magazine’s work/life balance list, although there doesn’t seem to be any difference sans one company we didn’t take the time to identify.
Unfortunately, there doesn’t seem to be any kind of formal ranking, unlike the BW list, so no firm has the ultimate bragging rights, which is probably upsetting Deloitte who was probably going for the Grand Slam of magazine Best Of Lists.
A quick run down of some stats after the jump:
• Deloitte had the highest number of women on their Board of Directors at 29%
• 50% of PwC’s top earners are women
• 44% of E&Y managers are women and they have the most women partners, according to the list
• RSM’s total workforce is 55% women.
You can check more stats at each firm’s page. Frankly, for a major firm to NOT make this list doesn’t um, look too good (ahem, BDO).
Layoff Watch: KPMG
The Chicago office is the first to report having the sit-downs. Five professionals in one of the specialty tax practices at all levels except partner. We’ve seen several comments from people that have received emails but we haven’t received any confirmation and we’re still waiting to hear back from KPMG.
If you have severance details, number let go, or other information, send to tips@goingconcern.com or discuss in the comments.
