Tag: Promotions

Follow Up on KPMG Compensation and Promotion News

It’s been, in the words of one source, “a hell of a week” at KPMG. John Veihmeyer & Co. have been on a whirlwind communications tour, people up for promotion are getting the good/bad news and the whole summer blast thing has people soiling themselves with excitement.

Since they’ve been on such a tear, we’ll update you with a little more news out of the House of Klynveld, returning to promotion and compensation news.


First the bad news – we’ve learned from multiple sources that newly promoted SAs in the audit practice won’t be getting much of a merit increase for their new positions. The news is that the new promotees will receive an early 1.25% increase later this summer that will be followed up by another increase, although those raises will be subject to the firm’s performance in the last part of the fiscal year.

Now the good news – After hearing from a couple offices in the west, most of the SA3s that are up for the promotion to manager seem to be getting the bump. From one office in the northwest:

Despite rampant speculation about widespread non-promotion of seniors to manager, only 3 (of around 15) 3rd year seniors didn’t get the bump. One CPA licence issue, and two performance issues. Nothing out of the ordinary even in a regular year, let alone in one where the holdbacks are supposed to be so numerous that they are creating a new 4th year senior training.

The percentage of SA3s in a Rocky Mountain office that are getting promoted is a little lower with approximately two-thirds of the class getting the bump. So far, only the (un)lucky (i.e. non-promotees) ones have received the news while the new managers continue to sweat it out. For this particular office, the decision to promote/not promote was a little more confusing that its counterpart in the northwest.

Based on the information we’ve gathered, each office is essentially given a number of promotees by the boys at 345 Park and the local office leadership is tasked with figuring it out from there. Criteria for promotion to manager (as we understand it) is that 1) the eligible SA needs to be “ready to be a manager” and 2) they need a business case (i.e. have clients to serve).

In the case of this office, it sounds like this was scrapped. Rather, it was decided that historical rating was the determining factor and not the criteria we outlined above. In other words, if you received high ratings (“EP” at KPMG) as an SA1 and SA2, that was more important than whether you actually have clients to work on as a manager. If you were in the meaty part of the curve (“SP” at KPMG), despite your strong “business case” you are SOL. Our source told us that, in the past, they were always told that “my historical rating would not be a determining factor when it came to promotions.”

So basically it boils down to how your particular office is doing. If you’ve got a strong market with plenty of clients, things should go fairly smooth (with a few exceptions). If you’ve got a competitive or shrinking market, your odds of getting the bump go down, in some cases, way down.

As always, keep us updated with your office’s developments, and congratulations and good luck to the new SAs and Managers!

Promotion Watch ’10: KPMG Announcing New Managers This Week?

While the timing seems early (Klynveld is on a 9/30 FYE), there has been a lot of chatter about the announcement of this year’s class of new managers happening this week.

From a Tim Flynn foot soldier close to the situation:

Heard on Monday that national was supposed to communicate yesterday or today, with communication to us this week.


And as you might imagine, there is some anxiety out there:

I’ll tell you one thing, the SA3s that don’t get promoted, they better get a ridiculous compensation package at the time they tell us we’re getting fucked. Otherwise, we’re all leaving. Two years in a row taking it up the ass from Uncle Peat? No thank you.

That’s the word from an office in the western region. Back east, there seems to be less concern:

DC already [announced], or everyone already knows, at least. Anyone with the requisite number of years and their CPA was promoted but DC has been bleeding employees lately. Everyone’s quitting or going on rotation at the senior and manager levels. Mostly quitting.

And what about those SA3s that don’t get the bump because A) they aren’t particularly popular or B) don’t have their CPA? Turns out KPMG is prepared for that. We’ve learned that the firm is offering a new training this summer specifically for SA4s. Soooo, we imagine that training could have some discussions that goes like this:

SA4 #1: Skipped over?

SA4 #2: Failed FAR three times. You?

SA4 #1: Was told that I’m “not quite ready” (hand quotes, eye roll) and that the 4th year will better prepare me for manager.

SA4 #2: Sucks.

SA4 #1: Sucks.

Keep us posted if you get the yay or nay in your office.

UPDATE: To answer a question in the comments, this is for the audit side of the house. If you’re tax or advisory feel free to weigh in on your own promotion possibilities.

Promotion Watch ’10: Deloitte Slowly Lengthens the Corporate Ladder

Yesterday we told you about the unofficial “our bad” from Deloitte on the layoffs that happened last spring. While that doesn’t necessarily address any of the subsequent layoffs, it’s a start.

And we have a little update from our previous query about Deloitte compensation increases as well as some promotion time-frame news:


A Green Dot familiar with the situation told us the following:

– There will be raises this year
– People shouldn’t expect raises like the ones back in the SOX days
– As always, there will be an effort to reward strong performers

At the same time, promotions may be a different story, at least for the R-space, where they want to move away from the “3 years to senior” mentality, towards a “ready to be a senior” mentality. Promotion time-frames are expected to be lengthened, although comp will remain competitive.

We should note that the raises in this case refer to the NE AERS, so if you’re hearing different in your region, let us know. The “won’t be like the SOx years” message also reiterates what DWB said on Tuesday about curbing your enthusiasm, so at least try to be realistic.

Regarding the promotion news, the effect on “R-space” which for you non-Deloittes means the “Advisory Practice,” our source indicated that this has been in the works for some time but has been poorly enforced in the past, with most eligible promotees getting the bump after three years in the trenches.

Further, it sounds as though the extended promotion time-frame (i.e. replacing “ready” with a given number of years) will occur at all levels, especially from senior manager to partner. Our source then mused, “Since Partners own their [senior managers]… it’ll be interesting to see how turn-over ends up.” That will certainly resonate with those that already consider senior manager to be a parking lot on the road to partner.

Deloitte isn’t the only firm that has given serious consideration to the lengthening of the corporate ladder. Last December we discussed KPMG’s always-being-discussed plans to move away from the six-year manager track in their audit practice. Back then we said:

The rumor that the KPMG bigwigs have been considering a six year timeline to make manager in the audit practice has been kicked around for at least a couple years. Naturally, there were two schools of thought:

• Managers thought it was good idea

• SAs thought it was a terrible idea

Deloitte insisting that salaries will remain competitive should quell some concerns although there are some out there that do get hung up on titles. So while it seems that Deloitte will be getting back to merit increases for FY ’10, they’re being much quieter about it and may be getting serious about adding some rungs to the ladder. Climb with patience.

Read This Before Getting Excited About the Big 4 Announcing Raises Early

What was first a bold move by PricewaterhouseCoopers has now become a pattern for the Big 4 – announcing raises early!!! Woooo-hoooooo!

Or will it be more of a boo-hoo?

Never to be really subtle about anything, news of these promotions and raises is a clear indicator that the firms are trying to lock down their talent and keep the masses happy, and by happy, I mean remaining on the boat. Avoiding an exodus now is absolutely critical; too many people leave and the already short-staffed will be painfully crushed come fall interim work. But where is the balance between raises, bonuses, and promotions?


Early Promotions! – Ahh, the double-edged sword that cuts deep. Years of relentless work, 100 hour weeks, and passionate ass-kissing finally paid off and you’re bumped up ahead of schedule. Welcome to hell. Take the expectations dial and crank it to max; your boss just got free reign to play the, “Well you got skip promoted, no way you can handle this” card. And your peers? They’re no longer your peers because money and job titles make people finicky. Better focus on befriending the first year hires.

And speaking of money – because promotional raises are typically a smaller percentage for early promotes, there’s no tangible financial gain to being bumped up a year early. Why is this? Because you should be happy to be get promoted early. Last time I checked, warm and fuzzy feelings can’t be put towards the mortgage.

• Don’t waste time printing new business cards. – Some of you will soon be inheriting a new job title to slap on top of your newly polished resume. The firms run the risk of those moving up to manager might jump ship completely. Don’t be surprised if the senior-to-manager class is larger than expected. Because eenie meenie minie moe – you’re moving on. Remember, it’s expected.

• “That’s it?!” – Unless you were part of the 0.043% of those who received raises since 2008, you’ve been living in monetary stagnation for quite some time; many of you even complained about receiving the “you’re lucky to have a job” speech from your superiors. When you have the raise conversation this summer, keep in mind that it is a raise for two years of work. Two years; two busy seasons; two increases in monthly rent. Don’t let yourself get all giddy over seven percent.

What Can Big 4 Accountants Expect Come Compensation/Firings Time?

Now that we’ve covered the natural and expected attrition of the Big 4 firms this time of year, let’s talk about what to expect if and when the post-busy season ax falls again. Per a reader’s request:

“Something similar to the salaries thread, except let the people tell us what $ package they were offered upon being “laid – off”, and how that was calculated (i.e. 1 weeks pay for every year of service? PTO paid out? 1 month severance pay?). I think this would be of interest to many folk out there who are about to be let go, as they can get a rough idea of what to expect and plan accordingly.”


I don’t expect the firings to be very widespread, but rather focused on small, top-heavy sectors (random, baseless examples – state and local tax in St. Louis, followed by IT advisory services in Atlanta). The reason for this is because the firms should be accounting for many to jump ship between April and Labor Day. Those up for promotion (“It’s coming this year, we promise!”) will bail in July/August once promo’s are announced.

For those of you only sticking it out to earn the manager title this summer before you leave, my advice is to start looking now. Inform your recruiters that the title is a mere formality and they will tailor their job hunts accordingly.

So. Let’s kick the weekend off with some wild speculation:

Potential Cuts:

• Federal tax groups
• Small offices and practices that have recently lost several small clients or one large client (e.g. PwC Orlando tax)
• Further cuts “when deemed necessary” before new hires begin in the fall

Safe zones:

• Hedge fund audits
• M&A advisory (based on KPMG whispers)
• IT advisory

Were you let go in the past two years? Share your severance packages in the comments so everyone can better gauge what to expect.

A Lawsuit Seeks To Find Out How Old is Too Old to Become a Partner at PwC

[caption id="attachment_3069" align="alignright" width="260" caption="That's a good one Bob but you really shouldn't tell old people jokes"][/caption]

Or any firm for that matter. There’s probably some opinions on this but allegedly at PwC it’s 54 on the low end and if you’re approaching the firm’s mandatory retirement age of 60 then you’re definitely not getting the bump.

The reason we bring it up is that the U.S. Court of Appeals for the District of Columbia Circuit has granted new life to an age discrimination lawsuit against PwC. Two advisory professionals, Harold Schuler and C. Westbrook Murphy’s lawsuit alleges that P. Dubs de-nied their admittance because they were close to the Firm’s mandatory retirement age.


The partner track at accounting firms is a long and tough road the way it is and for partners to allege age discrimination seems like insult to injury.

The DC Circuit ruled that the plaintiffs deserve some closure on whether or not the bigwigs in New York really snubbed them based on their age:

Judge Douglas Ginsburg said a 2008 D.C. Circuit ruling involving Schuler entitled the plaintiffs to a “reasonable inference” that PricewaterhouseCoopers’ decisions not to promote them were made in New York, where the firm is based.

“PwC says (the earlier case) ‘does not control’ because it addressed only PwC’s adoption and maintenance of a discriminatory policy, not the ‘discrete decision’ not to admit (Schuler) to partnership,'” Ginsburg wrote. “To which we say: Pettifoggery and piffle!”

Nice touch, Judge Ginsburg. So this means the case goes back to the district so they can get to the bottom of this.

We left messages at the other firms to find out what their mandatory retirement policies were to get some context on the age issue but so far we haven’t heard anything back. We’ll update you with those if we hear back from anyone.

It’ll be interesting to see how this shakes out since we’re pretty confident that their is no document anywhere at 300 Madison that says Schuler and Murphy were just too old to become partners. If we were to take a wild-ass guess, we’d say that the firm will point to performance reviews, etc. to rationalize the snub even if these guys were rainmakers.

PricewaterhouseCoopers age bias lawsuit revived [Reuters]

Disappointing Accounting Firm Trend: Managers Sitting in Cubicles

Sorry for the downtime today, we’ll make it up to you over the weekend. Promise.

It’s no secret that staff professionals working in public accounting are urged to “stay until manager” for all kinds of substantive reasons that we won’t get into here.

The attraction of being promoted to manager has many superficial benefits including being called a “manager”, having “manager” on your business cards, and getting an office rather than slumming in the cube farm.


With the reconfiguration of some offices however, your dream of getting an office with a door and possibly a window may be dashed as more and more managers, senior managers, and — GASP — even some directors are living life in the grey squares.

Now while this development is most certainly a direct slap in the face of everything public accounting represents, our understanding is that it is not spreading around like H1N1. It depends on the city you’re in, your practice, and possibly your coolness factor.

But if you are in one of the unlucky few in could be much, much worse if more firms follow the lead of E&Y Jericho and go the no-décor-will-be-allowed route (God help you if they lock the bathrooms too). How will these managers be able to appropriately express themselves? Oh! And how on Earth is a manager supposed to get some action during busy season? Cubicle sex is not happening. Christ, how will they live?

Rumor Mill: KPMG Debunking ‘Six Year Manager’ Rumors?

corp_ladder.jpgWhile many Klynveldians are getting amped to cobble together some bears for the kids this morning we’ll pass along a little rumor about a rumor.

The rumor that the KPMG bigwigs have been considering a six year timeline to make manager in the audit practice has been kicked around for at least a couple years. Naturally, there were two schools of thought:

• Managers thought it was good idea

• SAs thought it was a terrible idea

According to a tip we received, apparently there is an email floating around that says the rumors about a “six year program are not true and that the firm will continue with existing promotion timing.”

A friend of GC told us that while it’s entirely possible that such an email exists, it’s definitely not coming down from 345 Park and could be some local office trying to calm down those SAs that are considered flight risks.

Regardless of the rumored debunking, the path to partner is certainly becoming longer as we reported earlier this week, and early promotions will still happen based on need or political maneuvering.

If you’ve been notified that your promotion timing is still on track, by email or otherwise, pass the info along or discuss in the comments.

Deloitte Names New Partner in Charge of Southeast Region

Thumbnail image for DTa.jpgSome leadership changes for Deloitte are being reported in the DC area, as Gary Tabach will be the new partner in the charge of the Southeast region:

Gary Tabach, Deloitte LLP’s Greater Washington managing partner, has been promoted to vice chairman and regional managing partner for the accounting and consulting firm’s Southeast region.
He is replacing Maritza Montiel, who has been named managing partner of leadership development and succession.
Tabach now oversees some 10,200 staffers in 20 offices from Baltimore to San Juan, Puerto Rico.

Mr. Tabach still has to do most of the heavy lifting for his old job as he will remain the DC managing partner.
Ms. Montiel’s new position, managing partner of leadership development and succession, strikes as mysterious. That particular title gives the impression that she is “partner in charge of telling other partners that they need to lock it up or they’re fired”. If we’re in the ballpark let us know and keep us informed about any leadership changes for your office or region.
Deloitte’s Gary Tabach lands bigger regional role [Washington Business Journal (subscription required)]
Earlier:
New Deloitte Consulting CEO Plugs Magazine Lists, Shuns Facebook Fans

Grant Thornton Names a New COO*

Thumbnail image for Thumbnail image for Grant-thornton-logo.JPGGrant Thornton named Lou Grabowsky as its new Chief Operating Officer today. Grabs starts his new gig the same day as Stephen Chipman and Ed Nusbaum start in theirs so we’re guessing that will be quite the rager to kick off the decade.
LG takes over the day-to-day responsibilities at GT which no doubt includes overseeing the press release elves:

“Lou’s credentials are impeccable, and he will serve the firm with his characteristic commitment to excellence as Chief Operating Officer for Grant Thornton LLP,” says Stephen Chipman, Grant Thornton LLP CEO-elect. “His personal and professional strengths complement my own, and we have already been working on transition issues and other matters of high priority for the U.S. firm.”

Whoa, Steve-o, feeling ignored? We won’t forget that you’ve got strengths buddy. You didn’t get the big chair for nothing.
Back to the real reason for this little post, Grabs is a graduate of The Pennsylvania State University and an Arthur Andersen survivor. He was even the partner in charge of assurance services for the Dallas office from ’91-’97 so he may have known David Duncan. SCANDAL!
Just joshin’ you Lou. Enjoy the new gig.
Lou Grabowsky named Chief Operating Officer of Grant Thornton LLP [Press Release]
*Managed to only mention ‘Global Six Accounting Firm’ once

New McGladrey Directors to Check Out Natalie Gulbis?

gulbis3.jpgMaybe! RSM McGladrey/McGladrey & Pullen announced new directors in their Charlotte office today which is obviously exciting for them. We also think it’s nice that the press release still has both names of the firm together.
That gets us to wondering if M&P is heeding our advice? Regardless of that whole situation, it’s nice to see them come together for the sake of the new directors. Sort of like when bitterly divorced parents show up at their son or daughter’s graduation. Very touching.
Along with these promotions, the national finals for the McGladrey Team Championship start on Sunday at Pinehurst and you-know-who is going to be there.
Obviously we’re very curious as to whether these new directors will be in attendance to get a look at Natalie’s swing. Two McGladrey directors are actually playing in the tournament, so unless NG has a clause in her contract that says she doesn’t have to golf with accountants, there’s an outside shot one of those lucky ducks might end up in her group.
So if you’re in the area, it might be worth checking out since A) Obvious answer; and B) the silent auction has some cool stuff if you’re willing to drop some coin. Oh, and it benefits the Special Olympics, so that’s good too.
This is it! [RSM McGladrey Golf Blog]

Grant Thornton Spreads Out the Liability, Admits Nineteen New Partners

grant-thornton-logo-with-rose.jpgNineteen individuals have proven their passion for the business of accounting (as well as an intrepid attitude towards liability) as G to the T admitted new partners and directors effective August 1.
The press release is your standard trite lexicon but we can’t help but notice GT taking the opportunity to slip in their favorite moniker, “Global 6 accounting organization” or a derivative of such. GT is bound and determined to get this to catch fire even though no one outside of the GT press team has probably uttered the phrase.
Grant Thornton LLP admits 19 new partners and principals to the firm [Press Release]