UBS is going to name names, albeit not all of them, bringing us to ever so close to the bitter end of the whole IRS/UBS standoff.
All the gory details are expected to be released on August 10th, when hopefully everyone will kiss and make up officially.
The focus of the settlement will be around 7,000 or so accounts that are associated with offshore companies and trusts that are possibly tied to some financial shenanigans. Under the potential settlement, UBS won’t turn over any names until after September 23rd, which is the last day for offshore account holders to confess their sinful ways.
Deal Reached in UBS Tax Battle [WSJ]
- Friday Footnotes: Feds Get a Tax Preparer in Their Biggest Pandemic Relief Bust Yet; AI Is Coming For Offshore Busy Work | 4.10.26
- Apparently Shouting “Promote Me! Promote Me!” in a Partner’s Face Can Get You Promoted at Deloitte
- Monday Morning Accounting News Brief: You Can’t Spell Audit Without AI; An Elaborate Scheme to Defraud the Air Force | 4.6.26
Wanted: New Political Rhetoric to Pander to the Populist Masses
Wealthy taxpayers now have some legit data that allows them to give the finger to all the rabid populist outrage that’s been going around. According to the most recent data provided by the IRS, the top 1% of taxpayers pay more taxes than the bottom 95%. The wealthiest 1% picks up 40.4% of the tax bill while the bottom 95% gets 39.4%.
This amounts to pretty inconvenient data for lots of Democrats politicians who have been screaming for years that the wealthiest Americans need to pay more taxes.
Tax Burden of Top 1% Now Exceeds That of Bottom 95% [Tax Policy Blog via TaxProf Blog]
Ex-BDO Partner Won’t Be on His Boat after Plea Deal
Ex-BDO partners that were involved with the firm’s tax shelters are continuing to drop like flies. This time, Mark Bloom, a hedge fund manager and former BDO partner that worked in the Tax Solutions group, pleaded guilty to several charges.
Bloom agreed to forfeit assets as part of his plea agreement including a boat and two Steinway pianos which Bloom performed versions of his favorite songs on:
Check out the song selection, after the jump
Deloitte to Squash Ratings?
Following up on yesterday’s post on KPMG’s slashing of ratings, we checked with a source that gave us the lowdown on the rating system at Deloitte:
“From what I heard, all of the 4s and 5s have already been shown the door. D&T is known to suppress ratings, so I doubt that there will be a lot of 1s or even 2s this year.”
So we asked them to elaborate on “suppress ratings”:
Get the details, after the jump
Your Senior and your manager will give you a rating. Lets say that you are good and they give you a 2. They will need to justify this rating to the entire firm when they have the review meeting (I forget the exact name). Since every Senior thinks that their staff is the shit, a lot of the 2s tend to get pushed down to 3s because if everyone is performing at a higher level, then that is the average. Then, they have a limited number of 2s to fight over…2s get paid more and I think that they get some kind of performance bonus. So they have an incentive to limit the number of 2s given out every year.
Sound familiar to anyone? Discuss.
We’re smack in the middle of performance review time so email us any shady changes, adjustments, throwing people under the bus, etc. going down to tips@goingconcern.com
BDO Seidman’s Revenue Disappoints Us
BDO Seidman’s revenue for the fiscal year end June 30 dropped nearly 6% to $620 million and dammit, we’re disappointed. Sure tax revenue is up 6% but assurance revenue was down 9% and consulting revenue was down over 15%. What’s the reason for this? According to BDO’s CEO Jack Weisbaum it’s…wait for it…yes, the recession. What a news flash.
According to Web CPA, BDO’s revenue breakdown is 60/25/10 for audit/tax/consulting and the remaining 5% is a grab bag of stuff. Point is, BDO is a whore for audit and considering how the whole Banco Espirito thing turned out…
Speaking of Portuguese banks, BDO is still on the hook for $522 million. No word on how that fits into the firm’s plans to bounce back in fiscal year 2010.
BDO Seidman Revenue Falls Due to Recession [Web CPA]
Scoping | 07.31.09
• Buffett Posts $1 Billion Profit on China Hybrid Carmaker BYD – “The automaker has jumped fivefold in Hong Kong trading since the deal was announced on Sept. 27, helped by Buffett’s investment and rising demand for fuel-efficient vehicles.” – YAWN. [Bloomberg]
• ‘Cash For Clunkers’ Lacks Cash For Clunkers [NPR]
• U.S. Recession Worse Than Previously Estimated, Revisions Show – “The first 12 months of the U.S. recession saw the economy shrink more than twice as much as previously estimated, reflecting even bigger declines in consumer spending and housing, revised figures showed.” Government data estimates not even close? THE HORROR. [Bloomberg]
• Regulators Are Getting Tougher on Banks -“Federal regulators have escalated the number of wounded banks they have essentially put on probation, with some of the targeted banks complaining that the action is too harsh.” [WSJ]
California Overtime Lawsuits Update
This is our initial coverage of the overtime lawsuits against some of the major accounting firms doing business in California. For those of you not up to speed, these suits were filed by non-licensed associates who believe they were misclassified under California law as exempt professionals and are due overtime and other benefits due to non-exempt employees.
The suits are all in various stages but the key case that may determine how the other cases will proceed is Campbell v. PricewaterhouseCoopers.
Campbell is currently awaiting argument before the 9th Circuit Court of Appeals. The primary issue before the court has to do with whether or not, under the professional exemption, an associate is required to be licensed by the state of California in order to qualify for exempt status. Counsel for Campbell essentially argues that only licensed or certified accountants can qualify for exempt status in California while PwC argues that uncertified accountants who can qualify as “learned professionals” are exempt employees and thus not eligible for overtime pay.
The U.S. District Court of the Eastern District of California granted summary judgment on liability in favor of Plaintiff Campbell and ruled that attest associates must have a license in order to be exempt. The court further held that they may not qualify for exempt status under the “learned professional” section of the exemption. However because the trial court felt it was a close question, it certified the matter to the 9th Circuit Court of Appeals for interlocutory appeal.
According to Bill Kershaw, of Kershaw, Cutter, Ratinoff LLP, lead counsel for the plaintiffs, the ruling in this matter could have significant repercussions for other remaining wage and overtime lawsuits. Mr. Kershaw believes that if 9th Circuit does rule in the favor of the plaintiffs, then the likelihood of the case resolving itself prior to trial would substantially increase.
If the court of appeals rules that learned professionals can be defined as exempt, PwC (and likely the other defendant accounting firms) will center their argument back in the trial court on the appeals court’s ruling that unlicensed accountants are indeed “learned professionals.”
We contacted Dave Nestor, Head of Communications for PwC in the U.S. and he provided us with the Firm’s statement:
PwC believes that its attest associates are professionals who spend the majority of their time engaged in challenging work requiring the use of their intellectual abilities, judgment and discretion. Based on these and other factors, PwC’s attest associates are properly considered exempt under applicable law, and are therefore appropriately compensated.
We’ve provided a list below of all the cases against accounting firms currently in the courts in California for your information. Check the list for your firm and please remember that it is your right to participate in any of the class action lawsuits if you meet the criteria set forth in the case. Even if you are still employed by the firm being sued, they cannot retaliate against you.
Likewise, you can participate in the case on behalf of the defendants if you are approached and choose to do so. You also have the right to not participate at all if you so choose.
If you receive any correspondence from your firm regarding the overtime and wage lawsuits, please let us know using tips@goingconcern.com. We’ll always keep you anonymous.
We’ll be covering this story as it progresses and continue to check back here for periodic updates.
Review Comments | 07.30.09
• N.Y. Attorney General Details Bonuses At Bailed-Out Banks – Cue populist outrage [NPR]
• Subpoenas Issued to Goldman Sachs, JPMorgan, U.S. Senator Says – YES! Political theatre to ensue [Bloomberg]
• CNBC Viewership Down 28% – DB has some ideas on how to get a boost (maybe literally) [Zero Hedge]
• Exxon Reports Lowest Profit Since 2003 – “earnings of $3.95 billion” Meh. [WSJ]
• Glenfiddich 50-Year $16,000 Whisky Tempts Investors – Who loves scotch? [Bloomberg]
Your CFO Might Be Clueless about How IFRS Will Affect Your Company
In some very comforting news, CFO’s in a recent poll said they’re unsure about how at transition to IFRS would affect their company.
More scary stats include 8% of those surveyed said that they are “very familiar” with how their company will be affected and 43% said they were not familiar at all. So what does all of this IFRS ignorance mean?
Check out the list after the jump
A) Lots of CFO’s don’t give a rat crap
2) Lots of CFO’s don’t really believe IFRS will come to the States
D) Lots of CFO’s need to work on their qualifications
The obtuseness may work out though. At the pace the conversion debate is going, by the time the conversion gets done we’ll all be dead.
Survey: CFOs unsure how international rules will affect U.S. business [DBJ]
Final Call for Tchotchkes
This is the final call for your firm’s schwag. The following submission is especially nice because someone at Ernst & Young was cool with a less than perfect item.
See this high-quality piece, after the jump

Quality in Everything We Do – Damn straight.
Rumor of the Day: KPMG Slashing Performance Ratings
Commenter Guest @ 2:39 brought to our attention that the Radio Station is cutting performance ratings circa now. This is a little more salt in the wound after pay freezes were announced slowly leaked. If you’ve had your performance review recently and you got blindsided by a cut rating let us know. Email your tips to tips@goingconcern.com
Your New Career Goal: FEI Hall of Fame
Did you ever dream of being inducted into any form of a hall of fame. Baseball? Rock ‘n Roll? Calculus? Did you think all hope was lost for this particular career goal when you decided to become a pointy-headed number cruncher?
Well, we’ve got great news for you. The Financial Executive International Hall of Fame was established four years ago (how did we miss that?) and just announced this year’s recipients. Now you too can fulfill those dreams of giving a teary-eyed speech, thanking all the little people you stepped over and around to become the finance and accounting oracle that you are.
This year’s ceremony will induct Donald Nicolaisen, former Chief Accountant at the SEC and Dennis Dammerman, former vice chairman at GE. So what if you’ve never heard of them? They’ve achieved financial professional immortality! You could be next. Oh, and Bob Pisani of CNBC is hosting. Joan Rivers won’t be far behind. Is there a reason that this ceremony isn’t being beamed into every home in America?
Nicolaisen, Dammerman Named to FEI Hall of Fame [FEI Financial Reporting Blog]
