Everything You Wanted to Know About Internal Audit (But Were Afraid to Ask)
If you’d asked me for the definition of internal audit a few months ago, I would have guessed it was some sort of self-help cleansing ritual involving crystals and quinoa. You know, the type of exercise where afterward you annoy all your friends by telling them how mindful and present you are now. And they […]
The Allscripts Director of Corporate Audit Accused by SEC of Insider Trading Once Worked at Deloitte
Feel free to refer to our earlier post about Steven Dombrowski's trouble with the SEC. So, there wasn't much about our pal Steve in the SEC complaint, but that's what interns are for. I put my kitten to work against Google and she was able to pull up this now-removed LinkedIn profile that tells us […]
ICYMI: Here’s a Hitler Video That Might Help Your Company Decide If It Should Outsource Its Internal Audit Function
The Hitler video meme died long ago, but I regret missing this jump the shark moment from 2010 when "Hitler Finds Out the Board is Keeping Internal Audit In-House." Mostly because I try to deliver these weighty stories to you all in a timely fashion, but even moreso that there's a slight dig at the […]
PwC Poaches a KPMG Partner and Issues a Press Release, Part VIII
An alternative title for this post would be "PwC Poaches a KPMG Partner and a Deloitte Partner and Issues a Press Release, Part I." John Tantillo and Farah Faruqui are proud new partners in PwC's Risk Assurance Services practice; they both specialize in internal audit. Tantillo spent 27 years at KPMG prior to trading in for […]
A Miserable Internal Auditor Wants to Jump Into Public Accounting
Need help putting together your typo-laden farewell email? Need assurance that your GC trolling doesn't present an ethical conflict? Unsure which flavor of Doritos to choose from the office snack machine? Get in touch and we'll do what we can. Hi Adrienne, I have not seen a post about Internal Audit to Public Accounting so […]
Future Big 4 Associate Needs Help Choosing Between Commuting Hell and a Happy Marriage
Ed. Note: DWB was sober long enough today to pen this post for the Friday edition of Accounting Career Couch. If you’ve got a question for us email us at [email protected]. We’ll dispense with further pleasantries and get right to it.
I just received three offers from two Big 4 firms in San Francisco (Deloitte and KPMG) for audit and one Big 4 firm for advisory internal audit in San Jose. I really like the idea of going into advisory but the problem is that I live in San Francisco and the advisory clients for this firm are all located around San Jose and the Silicon Valley. This would likely mean at least a one hour and 15 minute commute every day each way from SF to SJ and back again lients I would likely be working on from SF are all located within 20 minutes of my apartment in the city. Moving to San Jose is out of the question for me because my wife works in SF and I’m not ready for a divorce just yet. My question to you and Going Concern readers is should I take the advisory job despite the crazy commute or should I take one of the audit positions?
I’d still be very happy taking one of the audit positions but I’d be lying if I didn’t say that the more consistent working hours of advisory internal audit didn’t appeal to me much more than audit (no insane busy season in advisory). Much of this benefit would be negated by my much longer commute though. Also, if I choose advisory I would be likely getting reimbursed $0 for my commute since the job is based out of the SJ office and I am based in SF. Although $0.50 a mile doesn’t sound like a lot, it really does add up to several thousand dollars in missed reimbursement expenses for such a long commute (assuming 80 miles a day in reimbursable driving). Also, the advisory position pay is slightly less to begin with (approximately $1,500 less) than my audit offers. Other considerations that I am thinking about are that many people from the Deloitte office (mostly associates) have said that the Deloitte SF office is understaffed. To me this means more opportunity for advancement but also more hours of work. Also, I feel that if I started in audit I could do two years of audit and if I didn’t like it then could jump ship to advisory in SF rather than having to start at advisory in SJ and beg to get a transfer to the SF advisory practice in a year or two. So what should I do? Should the lengthy and costly commute for advisory versus audit be a deal breaker? Will I struggle to break into advisory after two years in audit if I decide to make the switch?
Hopefully I’ve given enough info about my choices so that DWBraddock will stop complaining about us not saying enough in our requests for advice.
Kudos to you and your detailed email. Peons of the accounting world – take note [Ed. note: but there is something to be said for brevity. Yeesh.].
First off, my advice is from the “this is usually how it works” camp. Are there exceptions? Of course, and I’m sure that commenters will point them out.
Are you sure you will be reimbursed for every single mile that you travel? The HR policy is typically the net difference between your home to the office and your home to the client site. For example if you live 50 miles from the office and the client site is 53 miles from your home, you are reimbursed for the three mile difference. I strongly encourage you to consult HR before you go re-adjusting the all-in value of the advisory offer with thousands of dollars of mileage.
Now that I crushed your dream of banking $1,000’s, let’s discuss the audit vs. internal audit battle. You make a lot of assumptions in your email, but I think these bullets cover everything you discussed:
• Internal audit should not be looked at as a green-lighted pass to jump around the advisory practice. Many advisory roles are target recruited and are very specialized from a work capacity point of view. The name “advisory” doesn’t mean the roles are similar; it’s simply a nicer way of saying “everything that’s not audit and tax.”
• You will not be fast-tracked at Deloitte just because they’re short staffed. You will work your ass off.
• It’s easier to go from internal audit to external audit, not the other way around (the way you mentioned).
• Don’t think a transfer is a simple process. There has to be a need in the office you want to transfer to, and considering you’re contemplating and office and practice switch-a-roo in one swift motion…really? This is not a game – this is business and not everyone gets what they want.
• PS – I forwarded this to your wife. She said you’re sleeping on the couch for the next week.
Accounting News Roundup: Grassley Not Sold on Financial Reform Bill; LeBron Was Probably Considering Tax Implications; Target: Your Spreadsheets | 07.09.10
Grassley Airs Concerns As Vote Nears on Financial Bill [WSJ]
“Iowa Republican Sen. Charles Grassley is ‘very concerned’ about a provision in the financial overhaul bill designed to pay for the le aid Thursday, potentially complicating White House efforts to build a filibuster-proof majority to back the measure.
If Mr. Grassley decides to vote against the bill, Democrats would be left with little margin for error when they bring the bill to the Senate floor, which could happen as soon as next week. Mr. Grassley was one of four Republicans to support an earlier version of the bill when it narrowly passed the Senate in May.”
Number of CEOs Stepping Down is on the Rise [FBN]
It’s hard out there for a CEO. Ask Russ Smyth.
State Jock Taxes: Is LeBron Better Off in Miami? [Tax Foundation]
Of course Florida has no income tax, so every game that LBJ plays in Florida he’ll have a tax liability of $0. What about the other 41 games outside of FLA? That’s another story, “True, if James plays in Miami, none of his neighbors will be paying state income tax, but thanks to the jock tax, LeBron will.
While most people who travel in their jobs pay state income tax only to their home state, which is zero in Florida, athletes get special attention. In the NBA, each player’s per-game salary is computed, and whenever a team is on the road, the players must pay whichever tax rate is higher, the home state’s or the away state’s.”
Facebook Often Not a Job Seeker’s Friend [FINS]
If you’re pounding the pavement for a new job out there, it’s pretty much a given that people are looking at your online activity. But just how much and where? Based on the conversation between FINS’ Kyle Stock asked Michael Fertik of ReputationDefender Inc, you’d better drop those loser friends from high school that have appeared on Cops:
Kyle Stock: Can you speak briefly on to what extent companies are checking up on candidates online?
Michael Fertik: They’re absolutely doing it. It’s somewhere around 70% to 80% of hiring managers. . . And not only are they looking online, they are also looking in really remarkable places like virtual worlds and gaming rooms.
KS: To what extent do people realize this is going on?
MF: Somewhere around 70% of employers are considering online information when evaluating a candidate and only 7% of candidates believe they are doing so. There’s a huge gulf of understanding. . . Everybody has been opted in. There’s kind of a willful ignorance about it. That’s changing, but it’s still there.
And the kinds of information being considered are growing very diverse. It’s not just the photo that you published of yourself with a beer or a bong, it’s also content like who your friends are and what they post on your page and what kinds of groups that you link to. There’s kind of an associative picture that they develop of you and then they make decisions about you based on those associations.
Russian Spies Head Home in Swap Echoing Cold War [Bloomberg]
Defendant #4 and the rest of the gang are going home, making your next conference predictably more boring. Or will it???
Internal Auditors Target Spreadsheets [CFO]
“Last month the Institute of Internal Auditors plugged a gap in its guidance for members by issuing recommendations for the auditing of ‘user-developed applications,’ which generally are spreadsheets and databases developed by end users rather than by IT personnel.
User-developed applications, or UDAs, are subject to a high level of data-integrity risk because there may not be adequate controls over validating their output or making changes to them, the IIA points out. There is also confidentiality risk, because a UDA and its data typically are easy to transmit outside the company via e-mail.”
Accounting News Roundup: Bank Tax Scrapped; Deloitte Cleveland Names New Managing Partner; What’s the Future of Internal Audit? | 06.30.10
Financial-Rules Redo Passes Major Hurdle [WSJ]
Who knew that lobbyists could be so effective? “Democrats initially proposed the $18 billion tax on the nation’s largest banks and hedge funds to cover the cost of expanding g of financial services, among other things. But the small number of Republicans crucial to the bill’s passage balked at the fee, which was added at the last minute to the legislation.
With more than a year’s worth of work in the balance, Democrats ditched the levy on Tuesday. Instead, they agreed to offset the bill’s costs by winding down early the $700 billion Troubled Asset Relief Program and assessing a more modest fee on banks through the Federal Deposit Insurance Corp.”
Volcker Said to Be Disappointed With Final Version of His Rule [Bloomberg]
If you go to the trouble of getting your name on the rule, with specific ideas in mind about what said rule entails, you’d be pretty upset if lobbyists hacked up to the point that it’s hardly recognizable. Plus octogenarians are probably used to getting their way.
“Volcker, the 82-year-old former Federal Reserve chairman, didn’t expect the proposal to be diluted so much, said a person with knowledge of his views. He’s content with language that bans banks from trading with their own capital, the person said.
‘The Volcker rule started out as a hard-and-fast rule on risky trades and investments,’ said Anthony Sanders, a finance professor at George Mason University School of Management in Fairfax, Virginia. ‘But through negotiations, it was weakened and ended up with many loopholes.’ ”
How Not To Look Desperate When Looking for Your Next Finance Job [FINS]
Because we know there are plenty of you out there.
Deloitte names Craig Donnan managing partner in Cleveland [Crain’s Cleveland]
Cake party? Mr Donnan takes over for Pat Mullin who has been the managing partner of the office since 1999.
The future of the internal audit profession [Marks on Governance]
“If we are to be relevant, chief audit executives (CAEs) have to refocus on providing assurance regarding how well management identifies, evaluates, responds, and manages risks – including the controls that keep risk levels within organizational tolerances.”
The Problem With Unreported Income [You’re the Boss/NYT]
The problem being that if you’re going to have one helluva time selling your business if a decent portion of its revenues are unreported.
“Legal and moral issues aside, there is only one way to view unreported income when it comes time to sell the business: forget that money ever existed. If you can only manage what you can measure in business, then the same holds true for what you can sell.”
AIG hires ex-Lehman lawyer as compliance head [Reuters]
As long as AIG doesn’t ask about arcane accounting disclosures, this should work out fine.
Accounting News Roundup: UK Launches Probe of E&Y’s Final Lehman Audit; Revolving Door at SEC Scrutinized; Swiss Upper House Rejects Referendum | 06.16.10
UK watchdog launches Lehman audit probe [Reuters]
The UK’s Accountancy and Actuarial Discipline Board (AADB), investigative and disciplinary body for accountants, has started an investigation into the Ernst & Young’s final audit of Lehman Brothers’ UK operations for the year ending November 30, 2007.
E&Y, completely familiar with this drill, is sticking to their guns, “Ernst & Young’s audit opinion stated that Lehman’s financial statements for that year were fairly presented in accordance with the relevant accounting standards, and we remain of that view.”